Author Archives: Chuck Hill

Innovative Ideas from the Brits

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A couple of very interesting videos of clever ideas that work together and might have Coast Guard applications.

First there is this little tracked amphibious truck, which can be launched from and climb back onto the catamaran work boat in the second video. Looks like these might have application in maintaining aids to navigation in rivers, deltas, shallow water, marshes, and possibly over snow and ice.

They might also come in handy during floods and for occasional atypical SAR cases.

Thanks to Lee for bringing these to my attention; I’m pretty sure he saw them at http://www.thinkdefence.co.uk/

GAO Responds to Fleet Mix Studies, Part 2, Commentary

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This is my commentary on the Fleet Mix Studies and GAO’s response to them. Part 1, which outlined the results of the studies and GAO’s reaction is here.

Other, previous, related posts include:
Offshore and Aviation Fleet Mix Study Published
Fleet Mix Where Are the Trade-offs

General Comments applicable to the evaluation process

While the best way to consider acquisitions is to consider lifecycle costs, these don’t seem to have been considered by any of the players involved. The NSCs have crews substantially smaller than the 378s they replaced. Presumably they also have lower maintenance and fuel costs as well. If lifecycle costs were considered there would have been less likelihood the NSCs would have been deferred or cancelled, as they seem to have been.

On the other hand the FRCs and OPCs are likely to cost more than the vessels they replace, except that some of the first OPCs are likely to actually replace 378s, which are probably much more costly to operate.

Also the value of these vessels as national security assets is not considered. Trade-offs of construction of cutters vs Navy ships was not considered.

How the Coast Guard has handled the process:

The Coast Guard may have made all the right decisions regarding type and number of assets, but they have not done a good job of explaining why the decisions are the right one, and they do not seem to have succeeded in building a consensus in favor of the program in the Department, Congress and the Administration. These people like to think they are part of the decision making process and, like it or not, they are. They have to be brought along the decision chain, so that they understand the rationale for the ultimate choices. The Fleet mix studies were an opportunity to do that, that was not fully exploited.

Some of the weaknesses I see in the Coast Guard’s studies were that

  • There were no ice-capable ships, so the budgetary effect of this requirement was not dealt with.
  • There is no consideration of trade-off between types.
  • There are no alternative types considered.
  • There was no exploration of the consequences of building less than the “Program of Record.”
  • The time dimension is largely ignored, in that there was little reference to the catastrophic effect of stretching out the replacement program.

It is unfortunate that the Coast Guard took so long to deliver their Fleet Mix Study to Congress. It was certainly not perfect, but Congress asked for it, and it should have been seen as part of a continuing process to build support. Feedback could have been incorporated and there would be an improved product by now. It is still not too late to use follow on studies in an iterative process to help convince decision makers outside the Coast Guard. Continue reading →

Inflation in Shipbuilding

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The Congressional Budget Office, July 2012 “An Analysis of the Navy’s Fiscal Year 2013 Shipbuilding Plan” (pdf), has an interesting sidebar, that applies to the Coast Guard as well as the Navy. It confirms what we have noted before (“Comparing Apples and Oranges-Ships and Cars”) The cost of ship building in the US is going up at a faster rate than inflation in general.

“Inflation in Shipbuilding

“An important factor affecting the Navy’s and the Congressional Budget Office’s (CBO’s) estimates is assumptions about future increases in the cost of building naval ships. The Department of Defense (DoD) has an overall estimate of future inflation (known as an inflator) that it uses to project increases in the costs of its procurement programs. However, according to the Navy, DoD’s inflator is lower than the actual inflation that occurred in the naval shipbuilding industry in the past decade. The Navy provided CBO with a historical shipbuilding index for 1960 through 2011 that incorporates the growth in the costs of labor and materials that the industry has experienced in the past. To project ship inflation for 2012 through 2018, the service extrapolated from that historical experience, using a weighted composite of annual percentage changes in the costs of labor and materials specific to shipbuilding. Those data are based on information provided by the shipyards about labor costs in the past, as well as on advance pricing agreements, vendor surveys, and projections of the cost of materials from the Bureau of Labor Statistics.

“From 2012 through 2018, the Navy projects, the index will grow at an average annual rate of 2.9 percent. By comparison, the gross domestic product (GDP) price index, which measures the prices of all final goods and services in the economy, will grow at an average annual rate of 1.6 percent between 2012 and 2018, in CBO’s estimation. The difference between the two rates implies that annual inflation will be 1.3 percentage points higher for shipbuilding programs during that period than for the economy as a whole.”

This suggest a number of things.

To some extent, this additional inflation, combined with low production rates, explains growth in the cost of the Coast Guard’s recapitalization over and above normal inflation rates.

We can expect additional actual cost growth in the future. Since cost will be compared to overall inflation rates the Coast Guard can expect more criticism as the project is dragged out.

Since the 10 and 20 year treasury bond rate (about 2.2%) is actually less than the inflation rate in the ship building industry (2.9%), the government would actually save money borrowing to pay for the accelerated construction. In addition construction at a higher rate and possibly multi-year procurements might save as much as an additional savings, possibly as much as 30%.

GAO reports on Declining Readiness of Legacy Fleet

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The GAO has published a new report, GAO-12-741, “Legacy Vessels’ Declining Conditions Reinforce Need for More Realistic Operational Targets”. I’ve added a link to the report on the reference page.

Hopefully I’ll be able to review it soon and provide the highlights. After a cursory glance one surprising result is that the 210s seem to be holding up better than the 270s, in spite of there age. This may be a reflection of their simplicity–fewer things to go wrong.

Shifts in Navy Presence, What Does It Mean to the Coast Guard

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The naval centric blog Informationdissemination has an interesting series of charts that purportedly show what the Navy thinks will be typical fleet distributions in the years 2013, 2017, and 2020.

It included a couple of surprises that might impact the Coast Guard.

Apparently there will be some significant changes in the forces assigned to SouthCom (Fourth Fleet). This could reasonably be expected to impact drug enforcement operations in the Caribbean and Eastern Pacific and Law Enforcement Detachments assigned to SouthCom Navy assets.

From five ships in 2013, typically:

  • 2 CG/DDG
  • 1 FFG
  • 1 Amphib
  • 1 Hospital Ship

In 2017, PCs and JHSVs replace the cruisers, destroyers, and frigates. The force is expected to include fourteen vessels:

  • 10 PC
  • 1  Amphib
  • 2 JHSV (Joint High Speed Vessels)
  • 1 Hospital Ship

By 2020 two LCS replace the amphib. The composition is expected to include fifteen vessels:

  • 10 PC
  • 2 LCS
  • 2 JHSV (Joint High Speed Vessels)
  • 1 Hospital Ship

The PCs are presumably Cyclone Class, because there are no new construction PCs planned for the Navy, but there is some question as to whether the Cyclone class will last until 2017 much less 2020.

The coding in the charts tell us the two JHSVs are expected to be permanently stationed in the area. (Could that mean Puerto Rico?) The other assets rotate in and out of the area. The JHSVs are fast. They have a helo deck. I haven’t seen any indication of their boat handling arrangement yet. They are basically high speed ferries, intended for intra-theater transportation. Their range is relatively limited.

The charts don’t indicate any shift in interest into the Arctic. Hard to tell if that omission is meaningful. Presumably some of the 15 ships on the West Coast (Third Fleet) could operate in the Arctic, but there is no change in the numbers on either coast in any of the three charts.

(Unfortunately, but not surprisingly, the charts tell us nothing about the six WPCs currently assigned to Patrol Forces South West Asia (PATFORSWA)).

U-boat Sunk by Coast Guard Escort Division Found off Nantucket

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CIMSEC is reporting that the wreck of the  U-550 (one of the larger, type IX boats) has been located off Nantucket.

She was sunk, 16 April 1944, by Coast Guard manned destroyer escorts USS Joyce (DE-317) and USS Peterson (DE-152) and Navy manned USS Grandy (DE-764). All were members of Escort Division 22, the only Coast Guard Escort Division formed in WWII. Grandy was temporarily assigned to replaced Coast Guard manned USS Leopold (DE-319), which had been sunk by a homing torpedo with the loss of 171, a month earlier.

Wiki report of the incident here.