Cost of LCS rises again

[unhappycamper]

Cost of LCS rises again
Staff writer - Staff writer
Posted : Tuesday Feb 5, 2008 22:15:32 EST

The price to buy each of the Navy’s first two Littoral Combat Ships has crashed through the $500 million barrier, and the final tab to deliver the ships is well over $600 million apiece, according to service budget documents released Feb. 4.

Soaring cost growth has severely disrupted the program, which once envisioned the purchase of a series of relatively inexpensive, $220 million warships that would take about two years to build. Lockheed Martin and General Dynamics (GD) are building ships to very different designs in a competition to be decided in 2009.

In January 2007, the Navy revealed that costs had exploded on Lockheed’s first ship. Service officials have never offered specific numbers for the new price tag, but repeatedly characterized it as “about $375 million.” Privately, sources have said for months that the costs for both competitors’ ships were well over $400 million. Now, Navy figures contained in justification documents submitted with the 2009 defense budget request show a “basic construction” cost for Lockheed’s Freedom (LCS 1) of $471 million; for GD’s Independence (LCS 2), $440 million.

Navy spokesman Lt. Cmdr. John Schofield, in response to a reporter’s query, explained that “basic construction cost is what has been previously used to baseline LCS cost.”

The 2004 original baseline for the ships was $220 million. Further charges bring the “total end cost” for the Freedom to $531 million. Those charges include $15 million in change orders, $12 million for government-furnished equipment (GFE) and $33 million listed as “Other.”


Rest of article at: http://www.navytimes.com/news/2008/02/defense_lcscosts_080205n/