Speculation about single-sourcing DD(X)

There is speculation that the US Navy is moving to have its next-generation DD(X) destroyer built at a single shipyard. Industry sources claim that the Navy wants to see Bath Iron Works and Ingalls Northrop compete head-to-head with the winner-takes-all approach for the design and construction of the DD(X).

This would enable the Navy to eliminate the need for a second source of supply since the USN feels the cost associated with maintaining a second source of supply cannot be justified now that the anticipated build rate of the program has been reduced to one ship per year. President Bush’s proposed 2006 budget calls for a $586 million cut in the DD(X) program, with five of the ships to be built between 2007 and 2011.

BIW and Northrop are both involved in the Arleigh Burke destroyer program, which is winding down, and are looking to the DD(X) to keep production busy. While the Navy has indicated that it plans to change its acquisition strategy, it has yet to go into specifics.

A single-source move by the Navy is unlikely to favor BIW, said Loren Thompson, industry analyst for the Lexington Institute, a public policy research group in Arlington, Va. “The most likely outcome of the Navy’s scheme is that Bath will lose its role in building the DD(X) destroyer,” Thompson said. “The Navy, for some time, has been trying to find a politically acceptable way of sending the production of warships to the Gulf of Mexico shipyards, and I think that’s really what this competition is all about.”