Alternatives for Modernizing the Navy’s Sealift Force
CBO estimates that the Navy’s plan to modernize and operate its sealift ships over the next 30 years would cost roughly $39 billion. In this report, CBO explores four alternatives that would vary in cost from $34 billion to $40 billion.
In March 2018, the Department of the Navy submitted to the Congress a plan to modernize the nation’s sealift force over the next 30 years. Sealift ships move most of the equipment and supplies that the Army and Marine Corps need when they are deployed to overseas theaters of operation. CBO estimated the cost of implementing the Navy’s plan and then compared that plan with four alternatives.
The Navy’s Plan. The Navy’s plan calls for modernizing the sealift force through a combination of approaches: extending the service life of some existing ships, buying used ships in the 2020s, and then buying new ships starting in 2030. According to CBO’s estimate, the Navy’s plan would cost a total of about $39 billion (in 2019 dollars) over the next 30 years, including operation and support costs.
Buy More New Ships. Of the four alternatives to the Navy’s plan that CBO explored, the first two would have the federal government accelerate the purchase of new ships and not buy any used ships beyond those already authorized by the Congress.
Buy More Used Ships. In the third alternative, the government would not buy new ships but would rely instead on purchasing used ships.
Use Chartered Ships. The fourth alternative would have the government contract with private shipping companies over time to charter ships for the sealift mission, eventually relieving it of responsibility for purchasing, maintaining, and operating sealift forces.
All four of CBO's alternatives would meet or nearly meet the Department of Defense’s (DoD’s) goal for the cargo capacity of the sealift force, and the total costs for the Navy’s plan and the four alternatives, including acquisition and 30-year operation and support costs, are similar. The costs of those alternatives would vary from $34 billion to $40 billion over the next 30 years; the two alternatives for buying new ships would cost more than buying used ships or chartering ships. Three of the four alternatives would cost less than the Navy’s plan, according to CBO’s estimates, by between 5 percent and 12 percent.
DoD’s current goal for the sealift force is to maintain at least 15.3 million square feet of militarily useful cargo space on its ships. That space would be used in the event of a war that required transporting the equipment of a large military force overseas. Troops would be flown to the overseas location where the equipment was deposited to begin operations. DoD would like to maintain an additional 4.3 million square feet of cargo capacity in commercially owned ships, available on 18 days’ notice, to transport equipment and supplies to those overseas military forces. The civilian ships would primarily transport supplies for the military units once they were assembled.