U.S. Military Newbuilding

Although spending on new U.S. Navy ships is nowhere near the levels of a decade ago, the market still warrants the attention of many vessel builders and suppliers — companies which are still forging their way into the International commercial markets. A decision on the procurement of the LPD-17 class — the only new naval surface ship construction program to be introduced for the remainder of the century — is expected soon. The following two pages of charts and statistics provide a brief overview of the short and midterm prospects for Navy work.

Navy: New Construction = $10 Billion For Yards Through 2000 The U.S. Navy shipbuilding plan through the end of the century includes the construction of 32 new ships, eight ship conversions, one service life extension and one carrier refueling. More than $30 billion is proposed for this plan, and shipyard newbuild contract value accounts for about one-third of this amount. The remainder of the costs is attributed to government- furnished equipment placed aboard the vessels and to other government program costs.

The Navy's proposed FY 1996-2000 shipbuilding program follows the continuing trend of naval reductions. At an average of less than seven new ships per year, the program exhibits a 66 percent reduction in the quantity of ships to be procured, compared with the 19 ship per year average of th 1 980s.

T-Ship Program Boosts Newbuild Activity The U.S. Navy's T-Ship Program continues to be an important segment of ship construction and conversion activity for U.S. shipyards. Tships are auxiliary vessels funded by the Navy budget, but designed to be civilian-crewed and under the control of the Military Sealift Command. Since mid-1979, 16 U.S. private shipyards have been awarded contracts for the construction of 63 new ships and the conversion of 36 existing vessels. The initial contract value for these vessels totaled approximately $8.5 billion. During 1995, there was one new T-ship contract placed with a U.S. shipyard. Avondale Industries received an order with an initial contract value of $206.4 million to build one military sealift ship (T-AKR). Additionally, one contract, for the completion of the T-AGOS 23, a small waterplane area twin hull ocean surveillance ship (SWATH), was assigned to Halter Marine Inc. The contract value was $60 million. As of December 31,1995, 11 T-ships were under construction or on order at three shipyards, with an orderbook value of approximately $1.8 billion.

Now U.S. Navy Ships In Service In 1995 During 1995, 17 new naval vessels measuring 1,000 Idt and larger were delivered. The 17 totaled approximately 221,000 Idt and had an initial contract value of approximately $5.3 billion. In comparison, in 1994, just 15 vessels valued at $3.5 billion were delivered.