Comparing Apples and Oranges–Ships and Cars

Posted on January 7, 2011 by Chuck Hill

Ran across a statement in gCaptain that the 378s had cost $15M each (haven’t been able to find it again). I went looking for confirmation and found another source that listed the cost as $16-20M. In any case, comparing that range, with the range of costs for the National Security Cutters suggests that the price for these admittedly nicer ships is 30 times that of the ships they are replacing.

I bought my first new car in 1971, about the same time the Coast Guard was buying 378s. It cost me $2004 for a Datsun 510, a then technically advanced, but small economy car. (Upper middle-class performance cars like the GTO were going for about $3,500) Cars in the same economy car market segment now cost seven to ten times what my ’71 cost. In fact if you look hard you can find cars (base models of the Nissan Versa or Hundai Accent) that are better in every way and only cost five times as much.

Using this inflation calculator, inflation based on the CPI from January 1971 to January 2010 was 444.44% meaning, costs are about five and a half times what they were in 1971.

Yes the NSC is better equipped and larger than the 378s, but cars in the same market segments today are also about 25-50% larger, faster, safer, have more gadgets, and even get better gas mileage. My Datsun had bias ply tires, a four speed manual transmission,rubber floor mats instead of carpeting, no power windows, no air conditioning, an AM radio, the glass was not tinted, seat covering material was a sticky vinyl, and not even a rear window defogger.

Cars and ships are not exactly analogous, but it is hard to see how the price has gone up 30 times. The high prices for the NSC are not just a Coast Guard problem. In fact, on a cost per ton basis, the price for the forth NSC, $480M, is lower than that for the Littoral Combat Ships in the recent 20 ship buy that seems to have been viewed as a shewd deal.

Looks like there is plenty of room for efficiency improvements in the shipbuilding industry.

All the fault may not be with the ship builders. The Coast Guard has been working with interested builders in preparation for the Offshore Patrol Cutter project. Hopefully they are talking about how to work the price down to something more reasonable.

Sail Training Ship for Pakistan

Posted on January 6, 2011 by Chuck Hill

Looks like the US Coast Guard is not the only service that still sees value in sail training. The Pakistanis have recently acquired a new sail training vessel. A bit smaller than the Eagle, but still a good sized ship, it measures 59.35 meters (196 ft) in length, with a draught of 4.8 meters (15.84 ft) and 498 tons. Its 18 sails total 949 square meters (10,335 sq.ft.).

How We Got in This Mess-A Short History of CG Shipbuilding

Posted on January 5, 2011 by Chuck Hill

Over the last 60 years the Coast Guard has typically fielded about 45 large patrol cutters, 1000 tons or greater (Is the Fleet Shrinking?) with as many as 36 WMECs. Theoretically we could build an average of 1.5 ships a year and maintain a fleet with an average age of about 15 years with progressive improvements introduced based on experience. This may be something to work toward, but it hasn’t been working that way. The Coast Guard’s current fleet is largely the product of two great spasms of ship building, WWII and one beginning in the 60s, a smaller bump in the 80’s, and long periods when no ships were built.

The last Lake class 255ft WPG/WHEC entered service in 1946. In the 64 years since then, this is the record of Patrol Cutter construction.

1947-1963 (17 years) no new construction patrol cutters entered service. The service did acquire ex-Navy destroyer escorts (what would now be called frigates), 311 foot Barnegat Class former seaplane and torpedo boat tenders, 213 foot former submarine rescue vessels, and 205 foot former fleet tugs.
1964-1972 (9 years) The 16 Reliance class 210s, built in four different yards, including five by the Coast Guard Yard, entered service 1964-1969. The 12 Hamilton Class 378s, all built at Avondale, entered service 1967-1972. (The original plan was for 36 378s.) (28 ships/9 years=3.11 ships/year)
1973-1982 (10 years) no new construction patrol cutters entered service.
1983-1990 (8 years) The 13 Bear class 270s entered service between 1983 and 1990. (13 ships/8 years=1.625 ships/yr)
1991-2007 (17 years) no new construction patrol cutters entered service.
2008 Bertholf entered service
2009 no new construction cutters entered service.
2010 Waesche entered service.

45 of 64 years, no new construction patrol cutters entered service. All 43 new construction ships (210s, 378s, 270s, NSCs) were delivered in only 19 years. The current rate of construction (two ships in three years) is less than the minimum average long term construction rate (1.5 ships/year).

The program begun in the 60s was a timely effort to replace the ships built in WWII and earlier, unfortunately it was stopped short of completing their replacement.

In 1990 when construction of the 270s stopped, we still had 10 WMECs that dated from WWII: Storis, three 213s, three 205s, and three 180 ft former WLBs. Logically we should have continued building two ships a year to replace these. (In 1991 they were all at least 46 years old.) They would have all been replaced by 1995. Continuing two ships a year, the first 210s could have been replaced in 1996. When replaced, they would have all been at least 32 years old. Continuing two ship a year we could have replaced all the 210s and 378s by 2009. The first replacement for the 270s should have been contracted in 2010 to enter service in 2013.

We had an opportunity to have an orderly replacement program, but we blew it, beginning approximately FY87/88, when we failed to continue building ship, and let our engineering expertise atrophy.

Selling (and Saving) the Offshore Patrol Cutter Project

Posted on January 5, 2011 by Chuck Hill

Since seeing indications the Offshore Patrol Cutter (OPC) program may be in jeopardy (here and here), I’ve been thinking about how the program might be “sold.” There are a number of approaches that might be considered.

Conceptual Rendering of the OPC

It Is a Money Saver

Get it started as an alternative to the NSC. As discussed in an earlier post (Rethinking the New Cutter Programs), we can get more new cutters on line more quickly if we truncated the NSC program at six and started the OPC program two years earlier. This could also be sold as a money saving step, in that we can probably get two OPCs for little more than the price of one NSC. There is very little the NSC can do that the OPC can’t. (If we include the features suggested below, the OPC will be able to do things the NSC cannot-further justifying the change.) This gets us “over-the-hump” of starting the program. Having built the first ships of the class it will be much harder to kill the project and much easier to revive it, if interrupted. The winning shipyard and their legislative representatives will work to keep the project going. It will also mean the MECs and one HEC will be retiring at least a year earlier–the 210s will only be 54 to 56 years old.

Make the Consequences of Not Building Them Clear

Publish the decommissioning schedule. This should make the news in all the Congressional districts that will loose assets.

What is the performance difference. Publish an addendum to the latest “United States Coast Guard Fiscal Year 20XX Performance Report” showing the decrease in performance if there had been no MECs.

Publish a plan to scale back or delete missions if the the MECs are not replaced.

Pork with a Purpose:

An infrastructure (shipyard) program. It might be more expensive, but Congress can decide they want to spread the work around. They have been doing this, almost since the day the republic was formed. It would certainly be reasonable to say they wanted the construction contracted to more than one yard, perhaps even one West Coast, one East Coast, one Gulf Coast or some other split. As a stimulus program that also delivers a tangible good, building four a year, two each on the West and East Coasts would not be unreasonable. That this spreads the support base for the program wouldn’t hurt either. It might even promote some competition in the long term.

Mobilize our Allies

Mobilize the shipyards that hope to win contracts. They have political clout.

Get the fishing industry on our side. Some times they don’t like us, but we keep the foreign competitors out, and when there is a medical emergency or their boat starts sinking they’re mighty happy we are around.

Mobile the Navy League. Despite the name, this organization is a great ally of the Coast Guard as well, but I’ve yet to see us make the case for the OPC in the pages of their magazine.

Get the Navy to endorse the program. Not sure they will want to, but there are lots of reasons they should (Offshore Patrol Cutters, Why the Navy Should Support the Program), particularly if the design chosen has the potential to be a useful “low-end” warship. These are exactly the types of ships needed for partnership station, and they are the kind of ships many of our allies should include in their Navies and Coast Guards through Foreign Military Sales.

Strengthen the National Defense Angle

Bring back the ASW mission. Adding a passive towed array to the ship could help in our law enforcement mission, improving the chances of detecting and tracking semi-submersibles, but the additional military capability could also make the ship easier to justify. Beyond the support for a passive sonar usable for law enforcement, the only additions needed for a credible ASW capability would be having magazine and other storage space for torpedoes, sono-buoys, etc. to support Navy MH-60R helicopters that would prosecute contacts. There is more than enough reason for rejuvenating American ASW assets. As illogical as a US/Chinese confrontation would appear, they have been acting increasingly bellicose. The Chinese Navy already has more submarines than the Germans had at the beginning of WWII, the largest submarine force in the Pacific, while we and our allies have far fewer escort ships than any time in at least the last 70 years. There seems to be a particular need for escort ships for the underway replenishment ships, normally unarmed and unescorted, as they move from the ports where they load their supplies, to the areas where they deliver them to forward deployed task forces. OPCs could perform that mission.

Use the LCS Module Concept. This is ideal for the Coast Guard because it makes the ships adaptable for war time roles without requiring the Coast Guard to maintain either the equipment or the people. It also potentially gives the ships greater flexibility to perform peacetime roles. This requires very little more than some open space, foundations, and bringing up connections for utilities.

The Back Story

As an alternative to the LCS. Not that we can take this as an official line, but if the LCS program continues to draw criticism, particularly if the OPCs are designed to accept mission modules, it is something friends of the Coast Guard can suggest. It has been suggested in the past:

On 5 July 2009, Retired U.S. Navy Adm. James Lyons, former Commander in Chief of the U.S. Pacific Fleet, senior U.S. military representative to the United Nations, and Deputy Chief of Naval Operations, suggested the LCS “program should return to its original target of $220 million per ship and combine with the U.S. Coast Guard to build a dual-purpose ship with a credible integral combat system that can meet limited warfare requirements. This very different ship should be built in large numbers as part of the coming Ocean Patrol Cutter Program…Such a change would achieve huge savings for both the Navy and the Coast Guard tied to large production numbers. The funding saved from canceling the LCS could be used to procure the most capable high-end combatant ship with margins enough to allow future modernization.” –This could ally us with those in the Navy who would like to divert Navy money from the LCS program to other purposes.

Coming Soon-How We Got In this Mess

Commandant on the Stump

Posted on January 4, 2011 by Chuck Hill

Looks like the Commandant is going on stump to tell people how bad its has gotten, Commandant: Coast Guard Suffering Under Strain of Tight Budgets. While previous Commandants have gotten kudos for “doing more with less,” soon Admiral Papp is going to have to say we are doing less with less.

This is the second time I’ve seen reference to the OPC being killed. (First time here)

Not everything gets reported of course. The Commandant talked about the fact that even the newest ships, the 270s, are going to be over 40 years old when they are replaced, but he may have missed the opportunity to point out that even if we stick to the current plan, all the 210s are going to be 55 to 57 years old before they are replaced–I don’t think we should let people forget that.

A Hard Topic–But Important

Posted on January 4, 2011 by Chuck Hill

Rape is an ugly crime. It diminishes us all. Units where it happens are unlikely to have had much previous experience dealing with it.

This post, “Reporting a Sexual Assault in the United States Coast Guard,” came up on the Coast Guard’s own “Daily Newsbreak and Blogsum,” so it’s not something the service is ignoring or trying to hide, but I think it is too important to let it slip by unnoticed.

I really like this post because it isn’t just hand wringing, it offers some concrete recommendations that appear doable.

Countering Piracy, Time for a New Norm?

Posted on January 2, 2011 by Chuck Hill

2010 was another record year for piracy in the Indian Ocean. Despite massive naval effort, there were more seizures, more ransom money, and more hostages. Here is a chart of the incidents reported in 2010.

There has been some additional innovation on the part of the pirates, in response both to the additional Naval presence and to the weather. They are using large captured ships as mother-ships to make captures far from the regular naval patrols and in areas less effected by the monsoons.

The NATO Shipping Center reports, “…a large number of hijacked merchant and fishing vessels are currently underway to conduct piracy operations. This list includes MT MOTIVATOR, which is probably returning to the northeast coast of Somalia after pirating MV EMS RIVER, and MV HANNIBAL II which probably remains underway conducting piracy in the northern Somali Basin/Arabian Sea. MV YUAN XIANG may also be underway en route piracy operations in the Arabian Sea. MV IZUMI has returned to the east coast of Somalia following a piracy mission in the Arabian Sea, while MV YORK is underway in the central Somali Basin, probably en route piracy ops east of 60 degrees east longitude in the far east, central basin. MV POLAR is most likely returning to the Somali east coast after pirating Taiwan FV SHIUH FU 1 off Madagascar on 25 December. MV POLAR is now probably located northwest of the Seychelles, while FV SHIUH FU 1 may be continuing piracy operations east of Madagascar. In addition to pirated merchant ship/fishing vessel PAGs, there are probably at least 2-3 Dhow PAGs also active in the Arabian Sea and northern Somali Basin…Pirates are obviously taking advantage of the more seaworthy ships to extend their range of operations out into regions less impacted by the NE Monsoon.”

Obviously the greater scope of Pirate activity complicates Naval countermeasures.

Many commentators have suggested that the piracy problem will never be fixed until conditions improve in Somalia, and while that might be one solution it may not be the only one. “Information Dissemination” has some opinions (“2010 Counter Piracy Churn“) on what can be done while we wait for Somalia to stabilize (or for hell to freeze over, which ever comes first).

I have a proposal but it will require a cultural shift, a new norm, perhaps an international convention, and in the case of the US, a change in export licensing requirements.

Recommended “Best Management Practices” (To download a copy of the latest version, BMP3, please click here) advise against the use of firearms, despite the fact that no armed vessel has ever been taken.

Now that the pirates are using more seaworthy pirated ships and extending their range, its clear, if you allow your ship to be taken, you are endangering not only your own ship and crew, but others as well. Vessels ought to be permitted, even encouraged, to carry minimal weapons for their own self defense. This can’t be as hard as many claim. As late as the early 19th century, it was common for merchant ships to be armed. During WWII heavily armed merchant ships visited ports all over the world.

Below are pictures of some of the vessels being used by pirates as mother-ships (pictures from http://www.shipping.nato.int/):

Report Dallas Dry Docking Went Badly

Posted on January 2, 2011 by Chuck Hill

Tim Colton’s Maritime Memos is reporting there was a significant problem in the dry docking of the Dallas.

December 2, 2010: “International Ship Repair and Marine Services, LLC, had an accident on Monday night, when it’s Dock#6 apparently broke its back while docking USCGC Dallas, (WHEC 716). No announcements of any kind from anybody. I guess nobody needs to know.”

December 10, 2010: “Reports from people who were there indicate that Dallas was positioned with its stern hanging over the end of the dock, but its forward end was not in contact with the first 14 keel blocks. There’s a lot more besides this but it’s not needed here. This appears to have been a major screw-up and they are lucky nobody was hurt and the cutter was not badly damaged.”

Anyone know first hand what condition the ship is in?

Russian SAR in Trouble?

Posted on January 1, 2011 by Chuck Hill

The US Coast Guard apparently isn’t the only SAR organization whose ships have been run down. Sounds like the Russians may be considering a reorganization.

Text: RIA Novosti

Seventy per cent of Russian Navy’s search-and-rescue vessels are in need of repair, said Vice Premier Sergei Ivanov.

“‘Vessels of different search-and-rescue (SR) services are in critical condition; lifetime of 80 per cent SR ships have been expired, seventy per cent of them need either yard repair or modernization’, said Ivanov appearing at the session of maritime committee at Russian government.

“According to him, there are still segmented “departmental” approaches in the area of search-and-rescue at sea which lead to duplication of functions, scattering of funds, and dilution of responsibility.”

Navy Awards Contracts for 20 Littoral Combat Ships

Posted on December 30, 2010 by Chuck Hill

T he Navy has awarded two contracts for construction of up to 20 Littoral Combat Ships at an average cost of approximately $440M each. In something of a surprise, the trimaran Austal design came in slightly below the Lockheed Martin offer.

“Lockheed Martin Corp., Baltimore, Md., is being awarded a fixed-price-incentive contract for the fiscal 2010-2015 block buy of Flight 0+ Littoral Combat Ships (LCS). The fiscal 2010 LCS Flight 0+ ship award amount is $436,852,639. There are additional line items totaling $54,742,639 for technical data package, core class services, provisioned items orders, ordering, a not-to-exceed line item for non-recurring engineering, and data items. The total amount of the contract is $491,595,278. The contract includes line items for nine additional ships and options for post delivery support, additional crew and shore support, special studies, class services, class standard equipment support, economic order quantity equipment, selected ship systems equipment for a second source and selected ship system integration and test for a second source which, if authorized/exercised, would bring the cumulative value of this contract to $4,570,604,367. The cumulative value excluding any option items related to the second source is $4,069,913,166. Work will be performed in Marinette, Wis. (56 percent); Walpole, Mass. (14 percent); Washington, D.C. (12 percent); Oldsmar, Fla. (4 percent); Beloit, Wis. (3 percent); Moorestown, N.J. (2 percent); Minneapolis, Minn. (2 percent); and various locations of less than one percent, each totaling seven percent. Work is expected to be complete by August 2015. Contract funds will not expire at the end of the current fiscal year, except for fiscal 2010 RDT&E. This contract was competitively procured via the Federal Business Opportunities website with two offers received. The Naval Sea Systems Command, Washington, D.C., is the contracting activity (N00024-11-C-2300).

“Austal USA, LLC, Mobile, Ala., is being awarded a fixed-price-incentive contract for the fiscal 2010-2015 block buy of Flight 0+ Littoral Combat Ships (LCS). The fiscal 2010 LCS Flight 0+ ship award amount is $432,069,883. There are additional line items totaling $33,398,998 for technical data package, core class services, provisioned items orders, ordering, a not-to-exceed line item for non-recurring engineering, and data items. The total amount of the contract is $465,468,881. The contract includes line items for nine additional ships and options for post delivery support, additional crew and shore support, special studies, class services, class standard equipment support, economic order quantity equipment, selected ship systems equipment for a second source and selected ship system integration and test for a second source which, if authorized/exercised, would bring the cumulative value of this contract to $4,386,301,775. The cumulative value excluding any option items related to the second source is $3,785,807,006. Work will be performed in Mobile, Ala. (50 percent); Pittsfield, Mass. (17 percent); Cincinnati, Ohio (3 percent); Baltimore, Md. (2 percent); Burlington, Vt. (2 percent); New Orleans, La. (2 percent); and various locations of less than two percent each totaling 24 percent. Work is expected to be complete by June 2015. Contract funds will not expire at the end of the current fiscal year, except fiscal 2010 RDT&E. This contract was competitively procured via the Federal Business Opportunities website with two offers received. The Naval Sea Systems Command, Washington, D.C., is the contracting activity (N00024-11-C-2301).”

There is a good discussion of the implications here.

Coast Guard LEDETS and possibly Airborne Use of Force assets can expect to see a lot of these ships in the future for drug enforcement, counter-piracy, and partnership type missions.

There seems to be some surprise that they are getting a 3,000 ton ship for $440M (even though the rest of the world seems to do it for far less), but that doesn’t compare that well against the latest NSC contract for a 50% larger ship that cost less than 10% more. If we can maintain the same price per ton, approx. 2500 ton OPCs should cost about $270M. Perhaps if we could get a multi-year contract, they could be even less.