ARLEIGH BURKE 

DESTROYERS

Additional Analysis 

and Oversight 

Required to Support 

the Navy’s Future 

Surface Combatant 

Plans

Report to the Ranking Member,

Subcommittee on Defense, Committee 

on Appropriations, House of 

Representatives

January 2012

GAO-12-113

United States Government Accountability Office

GAO
United States Government Accountability Office

Highlights of GAO-12-113, a report to the 

Ranking Member, Subcommittee on Defense, 

Committee on Appropriations, House of 

Representatives 

January 2012 

ARLEIGH BURKE DESTROYERS 

Additional Analysis and Oversight Required to 

Support the Navy’s Future Surface Combatant Plans

Why GAO Did This Study

After nearly a decade and almost 

$10 billion in development on Zumwalt

class destroyers, the Navy changed its 

acquisition approach from procuring 

Zumwalts to restarting production of 

Arleigh Burke class destroyers (DDG 

51) and building a new version, known 

as Flight III. As requested, GAO 

reviewed the Navy’s plans for DDG 51 

and missile defense capabilities by 

(1) evaluating how the Navy 

determined the most appropriate 

platform to meet surface combatant 

requirements; (2) identifying and 

analyzing differences in design, cost, 

and schedule of the restart ships 

compared with previous ships; and 

(3) assessing the feasibility of Navy 

plans for maturing and integrating new 

technologies and capabilities. GAO

analyzed Navy and contractor 

documentation and interviewed Navy, 

contractor, and other officials. 

What GAO Recommends

GAO is making several 

recommendations to the Secretary of 

Defense, including requiring the Navy 

to conduct thorough analyses of 

alternatives for its future surface 

combatant program and conduct

realistic operational testing of the 

integrated missile defense capability of 

the DDG 51’s upgrade, ensuring that 

the Navy does not include the lead 

Flight III ship in a multiyear 

procurement request, and raising the 

level of oversight for this program. 

DOD agreed with the 

recommendations to varying degrees, 

but generally did not offer specific 

actions to address them. GAO believes 

all recommendations remain valid and 

has included matters for congressional 

consideration to ensure the soundness 

of the Navy’s business case.

What GAO Found

The Navy relied on its 2009 Radar/Hull Study as the basis to select DDG 51 over 

DDG 1000 to carry the Air and Missile Defense Radar (AMDR) as its preferred 

future surface combatant—a decision that may result in a procurement of up to 

43 destroyers and cost up to $80 billion over the next several decades. The 

Radar/Hull Study may not provide a sufficient analytical basis for a decision of 

this magnitude. Specifically, the Radar/Hull Study: 

• focuses on the capability of the radars it evaluated, but does not fully 

evaluate the capabilities of different shipboard combat systems and ship 

options under consideration, 

• does not include a thorough trade-off analysis that would compare the 

relative costs and benefits of different solutions under consideration or 

provide robust insight into all cost alternatives, and

• assumes a significantly reduced threat environment from other Navy 

analyses, which allowed radar performance to seem more effective than it 

may actually be against more sophisticated threats.

The Navy’s planned production schedules of the restart DDG 51 ships are 

comparable with past performance and officials told us that hull and mechanical 

systems changes are modest, but these ships will cost more than previous DDG 

51s. A major upgrade to the ship’s combat system software also brings several 

challenges that could affect the restart ships, due in part to a key component of 

this upgrade that has already faced delays. Further delays could postpone 

delivery to the shipyard for the first restart ship, and could also jeopardize the 

Navy’s plan to install and test the upgrade on an older DDG 51 prior to 

installation on the restart ships. This first installation would serve to mitigate risk, 

and if it does not occur on time the Navy will be identifying, analyzing, and 

resolving any combat system problems on the first restart ship. Further, the Navy 

does not plan to fully test new capabilities until after certifying the upgrade as 

combat-ready, and has not planned for realistic operational testing necessary to 

fully demonstrate its integrated cruise and ballistic missile defense performance. 

The Navy faces significant technical risks with its new Flight III DDG 51 ships, 

and the current level of oversight may not be sufficient given these risks. The 

Navy is pursuing a reasonable risk mitigation approach to AMDR development, 

but it will be technically challenging. According to Navy analysis, selecting the 

DDG 51 hullform to carry AMDR requires significant redesign and reduces the 

ability of these ships to accommodate future systems. This decision also limits 

the radar size to one that will be at best marginally effective and incapable of 

meeting the Navy’s desired capabilities. The Navy may have underestimated the 

cost of Flight III, and its plan to include the lead ship in a multiyear procurement 

contract given the limited knowledge about the configuration and the design of 

the ship creates potential cost risk. Finally, the current level of oversight may not 

be commensurate with a program of this size, cost, and risk and could result in 

less information being available to decision makers. View GAO-12-113. For more information, 

contact Belva Martin at (202) 512-4841 or 

MartinB@gao.gov. 
Page i GAO-12-113 Arleigh Burke Destroyers 

Letter 1 

Background 2

The Navy’s Study may not Provide a Sufficient Basis for a Sound, 

Long-Term Acquisition Program 7

Restart Ships are Costlier than Recent DDG 51s and Face a 

Challenging Combat System Upgrade 20

Flight III Cost and Technical Risks Pose Challenges for Oversight 31

Conclusions 51

Recommendations for Executive Action 52

Agency Comments and Our Evaluation 53

Matters for Congressional Consideration 55

Appendix I Objectives, Scope, and Methodology 57

Appendix II Comments from the Department Of Defense 60

Appendix III GAO Contacts and Staff Acknowledgments 64

Tables

Table 1: Overview of Radar Options Considered in Radar Hull 

Study 8

Table 2: Combat System Architecture Modifications Considered 9

Table 3: Examples of Combat System Characteristics That Could 

Have Been Evaluated in the Radar/Hull Study 11

Table 4: Ship Characteristics That Could Have Been Evaluated in 

the Radar/Hull Study 12

Table 5: Lead Ship Cost Estimates, Radar/Hull Study 15

Table 6: Comparison of Selected Ship Characteristics from the 

Radar/Hull Study 17

Table 7 Selected Major DDG 51 Changes and Corresponding 

Design Changes 21

Table 8: ACB 12 Components 26

Table 9: AMDR Technologies and Key Technical Challenges 35

Table 10: SLA Considerations with Select Ship Classes 41

Table 11: Differences in the Estimated Cost of the Lead DDG 51 

Flight III Ship 46

Contents
Page ii GAO-12-113 Arleigh Burke Destroyers 

Table 12: Flight III Program Compared with Factors to Determine 

ACAT ID Status 50

Figures

Figure 1: Timeline of Key Events in Future Surface Combatant 

Selection Process 6

Figure 2: Variants Considered in Radar/Hull Study 14

Figure 3: Notional Depiction of a Limited Trade-off Analysis 16

Figure 4: Proposed Design Changes for Restart Ships 21

Figure 5: Historic DDG 51 Construction Durations 24

Figure 6: Timeline of Aegis Upgrade Installation and Testing Events 28

Figure 7: Notional DDG 51 Flight III with AMDR 33

Figure 8: AMDR Schedule 34

Figure 9: SLA of Navy DDG 51 Flight III Concepts 40

Figure 10: Comparison of Procurement Costs for Flight III 47

Abbreviations

ACB Advanced Capability Build

AOA Analysis of Alternatives

AMDR Air and Missile Defense Radar

BMD Ballistic Missile Defense

DOD Department of Defense 

IAMD Integrated Air and Missile Defense

MAMDJF Maritime Air and Missile Defense of Joint Forces 

SLA Service Life Allowance

SPY Maritime surveillance radar

TSCE Total Ship Computing Environment

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Page 1 GAO-12-113 Arleigh Burke Destroyers 

United States Government Accountability Office

Washington, DC 20548

January 24, 2012

The Honorable Norm Dicks

Ranking Member

Subcommittee on Defense

Committee on Appropriations

House of Representatives

Dear Mr. Dicks:

After nearly a decade and almost $10 billion in development of the 

Zumwalt class destroyer (DDG 1000), the Navy—citing in part advances 

in ballistic and anti-ship missiles and proliferation of this technology—

changed its acquisition approach for surface combatants from procuring 

DDG 1000 to restarting production of the Arleigh Burke class destroyers 

(DDG 51). Navy officials believe that DDG 51—carrying the Aegis combat 

system1

—has a proven ballistic missile defense capability that makes it 

the preferred option over other ships to fill a gap in the Navy’s abilities to 

provide simultaneous defense against ballistic and cruise missiles (known 

as Integrated Air and Missile Defense, or IAMD), and that modifying DDG 

1000 would be too costly and bear too much risk. Concurrently, the Navy 

also cancelled its planned new air warfare-focused cruiser program, 

known as CG(X). Ultimately the Navy is procuring current versions of 

DDG 51 ships and plans to begin building a new version of the class 

(known as Flight III2

 

1 A combat system is a naval defense architecture that uses computers to integrate 

sensors (such as a radar) with shipboard weapon systems and can recommend weapons 

to the sailor through a command and control function. 

) that is to be modified to carry the advanced Air and 

Missile Defense Radar (AMDR) to meet the identified threats. Pursuing 

this strategy could require an investment of up to approximately $80 

billion for up to 43 destroyers, with DDG 51s providing IAMD capability for 

potentially up to the next 60 years. In this context, you asked us to review 

the Navy’s plans for DDG 51 and missile defense capabilities. In 

particular, we: (1) evaluated how the Navy determined the most 

appropriate platform to meet current and future surface combatant 

requirements; (2) identified and analyzed differences in design, cost, and 

2 There are three previous DDG 51 Flights: Flight I, Flight II, and Flight IIA. The 

differentiation of the various flights generally indicates upgrades that bring different 

capabilities and equipment to the ships of that flight. 

 
 

Page 2 GAO-12-113 Arleigh Burke Destroyers 

schedule of the restart DDG 51 ships compared with previous ships, and 

risks associated with the restart; and (3) assessed the feasibility of Navy 

plans for maturing and integrating new technologies and capabilities into 

the Flight III ships. 

To conduct our work, we analyzed Navy technical studies related to Flight 

III; documentation related to Flight III, CG(X), and AMDR; and 

Department of Defense (DOD) and Navy threat assessments. We 

analyzed AMDR performance specifications and contractor performance 

data related to ongoing Aegis combat system upgrades, as well as cost 

estimates for Flight III. We also met with Missile Defense Agency (MDA), 

Navy, and other DOD officials, as well as shipyard representatives from 

Bath Iron Works in Bath, Maine and Ingalls Shipbuilding in Pascagoula, 

Mississippi, and radar contractor representatives from Lockheed Martin, 

Northrop Grumman, and Raytheon. We are also providing you with a 

classified annex containing supplemental information. This annex is 

available upon request to those with the appropriate clearance and a 

validated need to know. For more information on our scope and 

methodology, see appendix I. 

We conducted this performance audit from January 2011 to January 2012 

in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives, and that the data we obtained 

and analyzed are sufficiently reliable for the purposes of our assessment. 

In the mid-2000s, the Navy was developing the DDG 1000 Zumwalt class 

destroyer—a new multimission land-attack ship—and laying the analytical 

framework to support a new air warfare cruiser acquisition program 

known as CG(X). The Navy planned to end DDG 51 production with the 

delivery of DDG 112 in 2011 (which would have completed the 62-ship 

program), and concentrate instead on DDG 1000—initially intended to be 

a class of up to 32 ships—and building up to 19 CG(X). However, at a 

July 31, 2008, hearing before the House Armed Services Committee, 

Seapower and Expeditionary Forces Subcommittee, the Navy stated that 

it faces a growing proliferation of ballistic missiles and antiship cruise 

missiles, requiring greater integrated air and missile defense capability 

and that the naval land attack capability provided by DDG 1000 had been 

obviated by improved precision munitions and targeting. Navy officials 

Background
 

Page 3 GAO-12-113 Arleigh Burke Destroyers 

added that DDG 1000 had performance deficiencies compared to DDG 

51, most notably in the areas of ballistic missile defense (BMD), area air 

defense, and some types of antisubmarine warfare.3 Most importantly, the 

Navy stated that at that time DDG 1000 could not carry the Standard 

Missile (SM) 2, SM-3, or SM-6 and was incapable of conducting BMD, 

though officials have since told us that DDG 1000 is now capable of 

carrying the SM-2 missile, and that the Mk 57 Vertical Launching System 

is expected to be capable of carrying any of the standard missiles.4

The DOD Joint Requirements Oversight Council had previously identified 

simultaneous defense against ballistic missiles and antiship cruise 

missiles as a capability gap and in 2006 validated that IAMD was an 

operational requirement not sufficiently addressed by other platforms. At 

the same time the Navy adopted BMD as a core Navy mission that it 

would perform in concert with MDA. In September 2009, the Joint 

Requirements Oversight Council also updated and revalidated IAMD 

requirements. In order to determine the appropriate type of ship and radar 

that would best address identified IAMD capability gaps, the Navy 

conducted an Analysis of Alternatives (AOA) known as the Maritime Air 

The 

Navy stated that DDG 51 was a proven ship with a proven combat 

system, and that the Navy intended on restarting production of DDG 51 to 

defend against substantial ballistic missile proliferation as a bridge to the 

deployment of CG(X). The Navy focused on building additional DDG 

ships, but did not discuss AMDR during this hearing. Following this 

hearing, the Navy began to initiate plans to truncate the DDG 1000 

program and made preparations to restart the DDG 51 program. 

 

3 DDG 1000 is optimized for littoral antisubmarine warfare, and the Navy testified that the 

DDG 51 is superior in the deep ocean. However, in a May 11, 2009 letter to the Chairman 

of the Senate Armed Services Committee, Subcommittee on Seapower, the Chief of 

Naval Operations stated that in some conditions the DDG 1000 could be expected to 

perform as well as or better than DDG 51s in antisubmarine warfare activities, and that at 

a campaign level the performance of both ships could be assumed as the same.

4 Officials stated that DDG 1000 requires a modification to the combat system in order for 

the radar and combat system to communicate with the missiles.
 

Page 4 GAO-12-113 Arleigh Burke Destroyers 

and Missile Defense of Joint Forces (MAMDJF).5 An AOA is an analytical 

comparison of the operational effectiveness, suitability, and life-cycle cost 

of alternative potential solutions to address valid capability needs. 

According to DOD acquisition guidance, an AOA examines potential 

material solutions with the goal of identifying the most promising option 

and is required to support a program’s initiation of the technology 

development phase at Milestone A.6 We have previously reported on the 

importance of a robust AOA as a key element in ensuring a program has 

a sound, executable business case prior to program initiation.

7

 Our work 

has found that programs that conduct a limited AOA tended to experience 

poorer outcomes—including cost growth.8

In 2007, as a result of conclusions identified in the MAMDJF AOA, the 

Navy determined that it needed a very large radar carried on a larger, 

newly designed surface combatant to counter the most stressing ballistic 

and cruise missile threats. Consequently, the MAMDJF AOA served as 

the AOA for both the CG(X) program and for a new, dual-band radar 

development effort called AMDR. The Navy initiated development of 

CG(X) and AMDR—a large radar designed to be scalable, meaning that it 

could be increased in physical size to allow it to provide increased 

capability to meet future threats. 

 

 

5 MAMDJF AOA considered a wide range of ship variants, including a new cruiser 

concept, a new radar ship concept, modified and upgraded DDG 1000 variants, a modified 

DDG 51 variant with a 40’ hull extension (known as a plug), and a modified LPD 17 

amphibious transport dock ship variant. IAMD is the simultaneous defense against both 

ballistic missile threat and air warfare threats such as hostile aircraft and cruise missiles. 

Some CG 47s and DDG 51s can perform air warfare and BMD, the Oliver Hazard Perry 

class frigates (FFG 7) can only conduct short range anti-air warfare and no ballistic missile 

defense.

6 Defense Acquisition Guidebook, section 3.3. The Weapons System Acquisition Reform 

Act of 2009 established a requirement for the development of study guidance for an AOA 

that requires, at a minimum, full consideration of possible trade-offs among cost, 

schedule, and performance objectives for each alternative considered, and an 

assessment of whether or not the joint military requirement can be met in a manner that is 

consistent with the cost and schedule objectives recommended by the Joint Requirements 

Oversight Council. Pub. L. No. 111-23, § 201(d).

7 GAO, Many Analyses of Alternatives Have Not Provided a Robust Assessment of 

Weapon System Options, GAO-09-665 (Washington, D.C.: Sept. 24, 2009).

8 GAO-09-665. 
 

Page 5 GAO-12-113 Arleigh Burke Destroyers 

In January 2009, in response to the Navy’s planned changes to its 

surface combatant program, the Office of the Under Secretary of Defense 

for Acquisition, Technology and Logistics released a memorandum 

stating that the Navy’s plan to buy additional DDG 51 Flight IIA ships 

would be followed by a procurement of either DDG 1000- or DDG 51-

based destroyers. The memorandum stated that this procurement would 

be referred to as the “Future Surface Combatant” until the appropriate 

hullform to carry AMDR was selected, and required that a study be 

conducted to identify this hullform. 

To meet this requirement, in 2009 the Navy conducted a limited study 

referred to as the Radar/Hull Study. In the Radar/Hull Study, the Navy 

examined only the two existing destroyer designs—DDG 51 and DDG 

1000—with several different radar concepts to determine which pairing 

would best address the IAMD capability gap and would be more 

affordable than CG(X), which Navy officials told us was estimated to cost 

upwards of $6 billion per ship. A senior review panel—known as a “red 

team”—also independently assessed the study, its analyses, and 

alternatives considered and provided a separate report on its findings. 

Following the conclusion of the Radar/Hull Study, the Navy validated the 

MAMDJF AOA’s findings that a very large radar carried on a larger, newly 

designed surface combatant was necessary to counter the most stressing 

threats, but decided, based on the analysis of the Radar/Hull Study, that 

the preferred solution to meet the IAMD capability gap would be pairing a 

smaller AMDR with the familiar DDG 51 hullform and the Aegis combat 

system—which would be referred to as DDG 51 Flight III. The Navy at the 

same time also cancelled the CG(X) program, largely as a result of cost 

considerations. The timing of this analysis and key decision making was 

compressed, as reflected in figure 1. 
 

Page 6 GAO-12-113 Arleigh Burke Destroyers 

Figure 1: Timeline of Key Events in Future Surface Combatant Selection Process

The Navy now plans to build 9 DDG 51s in an upgraded Flight IIA 

configuration. Construction of the first restart ship (DDG 113) began at 

Ingalls Shipbuilding in July 2011, approximately 4 years after construction 

started on the last DDG 51 at that yard. Though the restart program refers 

to all 9 restart ships, we focus on DDG 113-115 because these are the 

first restart ships built at both yards—Ingalls Shipbuilding and Bath Iron 

Works, the only two shipyards that currently build destroyers—and 

because contracts for these three ships were recently awarded (DDG 113 

in June 2011; DDG 114, 115, and an option for DDG 116 in September 

2011). After the first 9 ships, the Navy will then transition to building 22 

DDG 51s in the new Flight III configuration including AMDR, starting with 

construction of the lead Flight III ship (DDG 123) in fiscal year 2016, with 

an initial operating capability planned for 2023. The Navy is currently 

reviewing technical considerations and options for Flight III as part of an 
 

Page 7 GAO-12-113 Arleigh Burke Destroyers 

ongoing flight upgrade study that was initiated in February 2010. The 

Navy also has a notional Flight IV DDG 51 in its long-range shipbuilding 

plans.

The Radar/Hull Study may not provide a sufficient analytical basis given 

the magnitude of the Navy’s acquisition decision, including up to 43 

destroyers (22 of which will be in the Flight III configuration and 21 in a 

later Flight IV configuration, and both may require significant ship 

redesign), a new radar, and major combat system upgrades. The cost of 

22 Flight III ships is estimated to range from $58 to $64 billion (in constant 

2012 dollars), including research and development and procurement. This 

study played a central role in determining future Navy surface combatant 

acquisitions by contributing to a selection of the Navy’s preferred radar, 

combat system and ship solutions, making it, in essence, an AOA. 

Namely, the Radar/Hull Study provided analysis of the capability of 

multiple ship and radar alternatives against a revised IAMD capabilities 

gap, informing the selection of DDG 51 with AMDR as its preferred ship 

and radar combination. However, it does not provide an adequate 

evaluation of combat system and ship characteristics, and does not 

include key elements that are expected in an AOA that would help 

support a sound, long-term acquisition program decision. 

Navy officials who were involved in the Radar/Hull Study told us that the 

capability of the technology concepts they evaluated was considered a 

major priority, and that the goal was identifying the most capable solution 

to meet the IAMD threat in the near-term that was also cost-effective. 

Within this context, the study team analyzed the capability of the radar 

variants considered. The Navy determined that a dual-band radar (S- and 

X-Band radars working together as an integrated unit) was required to 

effectively perform IAMD. As a result, the study team focused on 

assessing several different combinations of S- and X-Band radars, as 

show in table 1. 

The Navy’s Study May

Not Provide a 

Sufficient Basis for a 

Sound, Long-Term 

Acquisition Program

The Navy Viewed Radar 

Capability as Primary 

Evaluative Criteria, Not 

Combat System and Ship 

Characteristics 
 

Page 8 GAO-12-113 Arleigh Burke Destroyers 

Table 1: Overview of Radar Options Considered in Radar Hull Study

Radar component Component name Component description

S-Band AMDR-S Developmental radar design; 12- or 14-foot array size considered.

Volume Search Radar+ 

(VSR+) 

Updated, more powerful version of the VSR developed for DDG 1000; 12- or 14-

foot array size considered.

X-Band SPY-3 Current X-Band radar for DDG 1000, consists of 3 array faces. 

SPQ-9B Rotating X-Band radar currently on CG 47, LPD 17, and other ship classes. 

Source: GAO analysis of Radar/Hull Study. 

The maximum radar size studied in the Radar/Hull Study was a 14-foot 

radar, since this was determined to be the largest size of radar that the 

DDG 51 hull could carry and the largest radar that DDG 1000 could carry 

without substantial deckhouse modifications. These radars were 

evaluated first against each other, and then combinations of radars were 

evaluated and compared with the capability of the current S-Band SPY1D(V) radar installed on recent DDG 51 ships. All provided enhanced 

power over and above that of SPY-1D(V); this difference was quantified 

as a “SPY+” (in decibels) equating to the increase in target tracking range 

for a fixed amount of resources over the SPY-1D(V) radar. SPY+15 has a 

32 times better signal to noise factor—or intensity of the returning radar 

signal echoing off a target over the intensity of background noise—than a 

SPY-1D(V) radar. Radars with additional average power and larger 

antennas have enhanced sensitivity, and thus better performance in 

advanced threat environments. The Navy found that the SPY+15 S-Band 

radars performed better than the SPY+11 S-Band radars, and the 

Radar/Hull Study’s independent red team described the capability of 

SPY+15 as marginally adequate. The Navy also found that the AMDR-S 

performed IAMD better than the VSR+. For the X-Band, the Radar/Hull 

Study identified that SPY-3 performed better than SPQ-9B. 

Although the Navy considered capability as a driving factor in its decision

making, the Radar/Hull Study did not include a thorough comparative 

analysis of the capabilities of the two combat system architectures—

Aegis on DDG 51 and the Total Ship Computing Environment (TSCE) on 

DDG 1000—into which the radars would need to be integrated.9

 

9 According to the Navy, the combat system consists not only of the combat system 

architecture (such as Aegis or TSCE), but it also includes the ship’s weapon systems, 

such as missiles and launchers, and ship sensors. When we discuss combat system 

options, we are referring only to the combat system architecture.

Other 

Limited Evaluation of Combat 

System Architectures 

Capability
 

Page 9 GAO-12-113 Arleigh Burke Destroyers 

than assessing the BMD capability that Aegis currently possesses and 

the absence of BMD capability in TSCE, the Navy evaluated Aegis and 

TSCE by focusing on the amount of new software code that it estimated 

would be required to integrate the radars and to effectively perform IAMD 

and the costs and risks involved in this development. Such analysis is 

important because selection of a combat system essentially determines 

the ship choice, and the combat system is the interface between the radar 

and the ship’s weapons. Since TSCE does not currently have an inherent 

BMD capability, the Navy identified several ways to add this capability 

using Aegis software and hardware. Similarly, changes were assessed to 

Aegis to provide it enhanced IAMD capability and the ability to leverage a 

dual-band radar. Table 2 depicts the combat system modifications that 

were considered.

Table 2: Combat System Architecture Modifications Considered

Combat system 

architecture Goal Modification considered Navy evaluation a

Aegis Integrate S-Band radar with SPY3; enhance IAMD functionality.TSCE components related to radar 

operation added into Aegis.

Preferred solution.

Integrate S-Band radar with SPQ9B; enhance IAMD functionality.SPQ-9B considered inferior radar.

TSCE Add BMD functionality to TSCE. TSCE command and control component 

replaced with the Aegis component.

Complicated modification 

requiring significant software 

development.

TSCE architecture stays largely intact, 

select components replaced with Aegis 

components.

Higher risk.

Source: GAO analysis of Radar/Hull Study. 

a

 Each combat system architecture modification was further subdivided into VSR+ and AMDR-S radar 

options. 

Though TSCE was intended to be the combat system architecture for 

CG(X) and thus would have been modified to perform BMD, the 

Radar/Hull Study states that developing a BMD capability “from scratch” 

for TSCE was not considered viable enough by the study team to warrant 

further analysis, particularly because of the investment already made in 

the Aegis program. The Navy concluded that developing IAMD software 

and hardware specifically for TSCE would be more expensive and 
 

Page 10 GAO-12-113 Arleigh Burke Destroyers 

present higher risk.10

While the Navy’s stated goal for the Radar/Hull Study was to identify the 

most capable solutions with an additional goal of affordability, the Navy 

selected Aegis based largely on its assessment of existing BMD 

capability, development costs and risk, and not on an analysis of other 

elements of combat system capability. Specifically, beyond the fact that 

Aegis already has a level of proven BMD capability and TSCE does not, 

other characteristics of the two combat systems that can contribute to 

overall performance were not evaluated.

Ultimately, the Navy determined that Aegis was its 

preferred combat system option. Navy officials stated that Aegis had 

proven some BMD capability and was widely used across the fleet, and 

that the Navy wanted to leverage the investments it had made over the 

years in this combat system, especially in its current development of a 

version that provides a new, limited IAMD capability. 

11 Table 3 summarizes some 

examples of combat system characteristics that could have been 

evaluated; more characteristics may exist. Since this analysis was not 

conducted, any impact of these capabilities on IAMD or other missions or 

how each system compares with each other is unknown. 

 

10 Raytheon—the lead contractor for TSCE—submitted an unsolicited proposal to develop 

BMD capability within TSCE while the Radar/Hull Study was under way, but Navy officials 

told us that this proposal was rejected because it was deemed incomplete, and the Navy 

was unable to determine if it was realistic. Navy officials also told us that the TSCE 

contract contains language prohibiting BMD development work within TSCE.

11 For additional discussion on combat system capabilities, see Classified Annex A which 

will be made available upon request to those with the appropriate clearance and a 

validated need to know. 
 

Page 11 GAO-12-113 Arleigh Burke Destroyers 

Table 3: Examples of Combat System Characteristics That Could Have Been 

Evaluated in the Radar/Hull Study

Characteristic Description

Computer 

processing ability

Ability of the computer system to process data; metrics may 

include the throughput of data that the system can manage and the 

speed at which it can complete work (e.g.: time to solution).

Cyber warfare 

capability

Offensive and defensive electronic and information operations may 

be a key component of future Navy missions. A combat system 

that enables the ship to defend against electronic attacks and 

possibly conduct electronic attacks of its own could contribute to 

enhanced capability and performance.

Reliability A measure of how long the system can operate without incurring 

failures that may require corrective maintenance actions.

Information 

assurance 

capability

Measures that protect and defend information and information 

systems by ensuring their availability, integrity, authentication, 

confidentiality, and nonrepudiation. This includes providing for 

restoration of information systems by incorporating protection, 

detection, and reaction capabilities. A combat system with robust 

information assurance capabilities would be less vulnerable to 

interference in the ship’s electronic network (e.g., viruses, hacking) 

than other systems.

Usability A human-system interface measure of the extent to which a 

system can be used to achieve specified goals with effectiveness, 

efficiency, and satisfaction.

Proprietary versus 

open architecture 

combat systems

Level of proprietary software code, which dictates whether or not 

combat system development efforts can be openly competed. 

Competing combat system upgrades could lead to reduced costs.

Scalability The ability of a system to handle an increased workload, either 

without adding or by adding additional resources.

Source: GAO analysis. 

Note: Because the characteristics noted above were not included in the Navy’s analysis, the 

implications of assessing or not assessing them is unknown. 

While considering the resident BMD capabilities of Aegis and comparing 

software development costs and risks are essential to making a decision, 

without a thorough combat system assessment, the Navy cannot be sure 

how other combat system characteristics can contribute to overall 

performance.

Because Aegis is carried by DDG 51 and not DDG 1000 ships, selection 

of Aegis as the preferred combat system essentially determined the 

preferred hull form. The Radar/Hull Study did not include any significant 

analysis of the ships themselves beyond comparing the costs to modify 

the ships to carry the new radar configurations and to procure variants of 

both types. Several characteristics associated with the ships (such as 

displacement or available power and cooling) were identified in the study. 

Capability of Ships Not 

Evaluated Beyond Ability to 

Carry AMDR
 

Page 12 GAO-12-113 Arleigh Burke Destroyers 

The ships were evaluated on their ability to meet Navy needs and the 

impact of these ship characteristics on costs. However, there was no 

documented comparison or discussion of the benefits or drawbacks 

associated with any additional capabilities that either ship may bring. 

Navy officials told us that these characteristics were not weighted or 

evaluated against one another. Other ship variables that directly relate to 

ship capability and performance—such as damage tolerance and stealth 

features that were explicitly designed into DDG 1000—were not 

discussed in the Radar/Hull Study, even though they were discussed in 

the MAMDJF AOA. The MAMDJF AOA notes that a stealthy ship is 

harder for enemy forces to detect and target, thus making it more likely 

that a stealthy ship would be available to execute its BMD mission. 

However, senior Navy officials told us that the Radar/Hull Study did not 

consider the impact of stealth on performance because the study 

assumed that stealth would not have a significant impact on performance 

in IAMD scenarios. Navy officials added that any additional benefits 

provided by DDG 1000 stealth features were not worth the high costs, 

and that adding larger radars to DDG 1000 would reduce its stealth. 

However, no modeling or simulation results or analysis were presented to 

support this conclusion. Table 4 depicts ship characteristics that were 

evaluated in the MAMDJF AOA that could have been evaluated in the 

Radar/Hull Study. 

Table 4: Ship Characteristics That Could Have Been Evaluated in the Radar/Hull 

Study 

Characteristics Description

Damage 

survivability

Ability of ship to sustain damage. Navy standards establish a 

minimum, but some ships may exceed these standards.

Ship signatures Ship emissions (e.g.: radar cross section, acoustic and magnetic 

signatures) which when reduced can enable stealthy operations. 

Time on station Ability of ship to remain in position without needing to refuel.

Range Maximum distance a ship can travel on a full tank of fuel.

Surge-to-objective Required number of replenishments required to transit ship to a 

specified objective.

Source: GAO analysis of Radar/Hull Study and MAMDJF AOA. 

Note: Because the characteristics noted above were not included in the Navy’s analysis, the 

implications of assessing or not assessing them is unknown. 

These characteristics influence performance, and each ship option has 

strengths and weaknesses that could have been compared to help 

provide a reasonable basis for selecting a ship. For example, DDG 1000 
 

Page 13 GAO-12-113 Arleigh Burke Destroyers 

has enhanced damage survivability and reduced ship signatures, while 

DDG 51 is capable of longer time-on-station and endurance.12 

The Radar/Hull Study did not include a robust trade-off analysis for the 

variants studied to support the Navy’s DDG 51 selection decision, which 

is currently planned to result in an acquisition of 22 modified Flight III 

DDG 51s and a further 21 modified DDG 51s known as Flight IV. DOD 

acquisition guidance indicates that a discussion of trade-offs between the 

attributes of each variant being considered is important in an AOA to 

support the rationale and cost-effectiveness of acquisition programs. A 

trade-off analysis usually entails evaluating the impact on cost of 

increasing the capability desired, essentially answering the question of 

how much more will it cost to get a greater degree of capability. A tradeoff analysis allows decision makers to determine which combination of 

variables provides the optimal solution for a cost they are willing to pay. 

For the Radar/Hull Study, the Navy examined 16 different combinations of 

ship, radar, and combat system options based around DDG 51 and DDG 

1000. These variants are depicted in figure 2. 

 

12 For a more detailed explanation of ship signature issues, see Classified Annex A which 

will be made available upon request to those with the appropriate clearance and a 

validated need to know. 

Radar/Hull Study Did Not 

Include a Robust Trade-off 

Analysis to Inform a Sound 

Decision
 

Page 14 GAO-12-113 Arleigh Burke Destroyers 

Figure 2: Variants Considered in Radar/Hull Study

The Radar/Hull Study documents full cost data for only 4 of the 16 ship 

variants; 8 ship variants have no cost data, and 4 others do not have ship 

procurement and operations and support costs. Instead, the Radar/Hull 

Study provided full cost data for only the most expensive and least 

expensive DDG 51 and DDG 1000 variants (high and low), and 

operations and support costs for these four variants. Higher costs were 

largely driven by the combat system selected. For example, the high DDG 

1000 variant included a 14-foot AMDR coupled with a SPY-3 radar, and 

the more expensive combat system solution, which comprised replacing 

the central core of DDG 1000's TSCE combat system with the core of the 

Aegis combat system. The high DDG 51 variant included a 14-foot AMDR 

coupled with a SPY-3 radar and the Aegis combat system. The low DDG 

1000 variant coupled a 12-foot VSR+ with the SPY-3 radar and a less 

expensive combat system solution involving replacing only portions of 

TSCE with portions of Aegis. The low DDG 51 included VSR+ coupled 

with the SPQ-9B radar and the Aegis combat system. In both the DDG 

1000 high and low cases, the combat system solutions would be equally 

capable; the difference was in the level of effort and costs required to 
 

Page 15 GAO-12-113 Arleigh Burke Destroyers 

implement the changes. Since only a high and low version of DDG 1000s 

were priced out, the study did not include a DDG 1000 variant with AMDR 

and the less complicated TSCE combat system upgrade that may be a 

less expensive—but equally capable—option. Because this variant was 

not included in the study, cost data were not provided. This study also 

presented a brief analysis of operations and support costs; the Navy 

concluded that it found only negligible differences between the operations 

and support costs for the DDG 51 and DDG 1000 variants. Previous DDG 

1000 cost estimates had indicated 28 percent lower long-term costs than 

DDG 51. While both ships had increases in these costs, the Navy 

determined in the Radar/Hull Study that adding additional crew to DDG 

1000 to perform BMD-related tasks and increased fuel costs were more 

significant for that ship, and made the costs essentially equal between the 

two ships. The costs of the 4 variants that the Radar/Hull Study priced are 

shown in table 5. 

Table 5: Lead Ship Cost Estimates, Radar/Hull Study 

(Dollars in millions)

DDG 51 variants DDG 1000 variants

Low 

VSR+/SPQ-9B

High

AMDR-S/SPY-3 

Low

VSR+/SPY-3 

High 

AMDR-S/SPY-3 

Operations 

and support Procurement a Operations 

and support b Procurement

Operations and 

support Procurement

Operations 

and support Procurement

$65.3 $2,310 $65.3 $2,946 $66.5 $3,203 $67.8 $3,367 

Source: Radar/Hull Study. 

a Operations and support costs are provided in fiscal year 2010 dollars in millions/per ship/per year 

b

 The low options of both ships are priced in fiscal year 2015 dollars, while the high options are priced 

in fiscal year 2016 dollars. 

Navy officials agreed that they could have developed cost estimates for 

all 16 of the variants, but stated that there was a time constraint for the 

study that prohibited further analysis, and that they believed that pricing 

the high and low options was enough to bound the overall costs for each 

ship class. Without complete cost data for all variants, the Navy could not 

conduct a thorough trade-off analysis of the variants that fell between the 

high and low extremes because the costs of these variants are unknown. 

DOD acquisition guidance highlights the importance of conducting a 

trade-off analysis. Conducting a trade-off analysis with costs for all the 

variants would have established the breakpoints between choices, and 

identified potential situations where a cheaper, slightly less capable ship 

or a more expensive but much more capable ship might be a reasonable 
 

Page 16 GAO-12-113 Arleigh Burke Destroyers 

choice. Figure 3 is a notional depiction of the limitations of missing cost 

data when conducting a trade-off analysis with only high and low data 

points. 

Figure 3: Notional Depiction of a Limited Trade-off Analysis

Further, the Navy also did not prioritize what aspects of the radar, combat 

system, and ship it valued more than others, which could also be used to 

inform a trade-off analysis. For example, if performance is valued more 

than cost, choosing a ship variant that has 10 percent more performance 

than another variant but with a 20 percent increase in cost might be in the 

Navy’s best interest. Alternatively, if cost was weighted more than 

performance, the Navy might choose the cheaper and slightly less 

capable ship as it would be able to get a 20 percent reduction in cost with 

only a 10 percent reduction in performance. Similarly, the study did not 

discuss the Navy’s preferences with regard to ship characteristics and the 

impact that differences in these characteristics might have on a trade-off 

analysis. For example, Navy officials told us that electrical power was a 

major concern for future destroyers, but the considerable difference in 

available power between DDG 51 and DDG 1000 (approximately 8,700 

kilowatts for DDG 51 after the addition of a supplemental generator 
 

Page 17 GAO-12-113 Arleigh Burke Destroyers 

compared to 78,000 kilowatts for DDG 1000 with no additional generators 

required) was not compared in a trade-off analysis. Finally, the Navy did 

not assess potential impacts of ship selection on future fleet composition. 

The MAMDJF AOA found that more capability can be obtained by fewer, 

more capable ships (meaning those with larger radars) than a greater 

number of less capable ships (meaning those with smaller radars). This 

could change the acquisition approach and would result in different 

program costs as a result if it is found that fewer, more capable ships are 

more cost-effective than many, less capable ships.

Navy officials told us that some of these trade offs were not done in the 

Radar/Hull Study because they were already studied in the MAMDJF 

AOA. However, that study, using a different threat environment and ship 

concepts, eliminated the DDG 51 variant from further consideration as a 

single ship solution; it also eliminated the DDG 1000 option without a 

radar larger than the 14-foot design that was considered in the Radar/Hull 

Study. Consequently, its analysis is not directly comparable or 

interchangeable with the Radar/Hull Study. When comparing the raw ship 

data from the Radar/Hull Study, we found that the two ships offer different 

features worth evaluating. For example, all DDG 1000 variants offer more 

excess cooling and service life allowance, meaning the ability of the ship 

to accommodate new technologies over the life of the ship without major, 

costly overhauls than DDG 51 variants, while DDG 51 variants offer 

greater endurance and lower procurement costs. Table 6 depicts a 

simplified presentation of this comparison. 

Table 6: Comparison of Selected Ship Characteristics from the Radar/Hull Study 

(Dollars in millions)

Variants

Procurement 

cost Excess power a Excess 

cooling

Service life 

allowance

Full load 

displacement b Number of missile cells

High DDG 51 $2,946 1,174 kW after 

addition of a 

generator

284 tons 4.4 percent

0.52 feet

9,865 long tons 96

High DDG 1000 $3,367 968 kW no 

additional 

generator required

461 tons 10.0 percent

1.0 feet

15,300 long tons 96

Source: GAO analysis of Radar/Hull Study. 

a Procurement costs only (fiscal year 2016 dollars, in millions) 

b Navy weight and center of gravity allowances to enable future changes to the ships, such as adding 

equipment and reasonable growth during the ship's service life without unacceptable impacts on the 

ship. Ten percent of weight and 1.0 foot of center of gravity are the Navy requirements for surface 

combatants. 
 

Page 18 GAO-12-113 Arleigh Burke Destroyers 

As this table shows, these two ships offer different characteristics. Both 

were deemed capable of carrying AMDR, but without conducting a tradeoff analysis of these characteristics, the Navy did not consider their 

relative merit and the significance, if any, of any differences between the 

two. Senior Navy officials told us that it is now conducting these types of 

trade-off analyses; however, these analyses are focused only on 

assessing various DDG 51 configurations, and were not done to help 

inform the ship selection decision. A preliminary finding of these new 

analyses is that the cost of Flight III is estimated to range from $58 billion 

to $64 billion (in constant 2012 dollars), including research and 

development and procurement.

The Radar/Hull Study assumed a significantly reduced threat environment 

compared to the earlier MAMDJF AOA and other Navy studies. How the 

threat is characterized is important because against a reduced threat 

environment, a less capable radar than what was identified as necessary 

in the MAMDJF AOA was described by the Radar/Hull Study as 

marginally adequate. Both the Radar/Hull Study and MAMDJF AOA

analyzed the performance of radars in several different classified tactical 

situations that presented threats of varying levels of complexity. The most 

stressing situations involved a number of different air and missile threats 

and a complex timing of events.13

 

13 For a more detailed description of the threat environments, see Classified Annex B

which will be made available upon request to those with the appropriate clearance and a 

validated need to know. 

In the MAMDJF AOA, these tactical 

situations involved many different types of simultaneous threats and 

larger radars, and were developed in consultation with the Office of Naval 

Intelligence—the agency tasked to provide validated threat intelligence to 

support Navy and joint, Navy-led acquisition programs—as well as MDA. 

Conversely, the subsequent Radar/Hull Study assumed a significantly 

reduced threat environment and smaller radar solutions than did the 

MAMDJF AOA. This study modeled radar performance based on a very 

limited air and missile threat which are both quantitatively and 

qualitatively less stressing than the threat environment established in the 

MAMDJF AOA, in other Navy and DOD threat analyses, and in system 

guideline documents for AMDR. Also, the Office of Naval Intelligence was 

Radar/Hull Study Assumed 

a Significantly Reduced 

Threat Than Other Studies 
 

Page 19 GAO-12-113 Arleigh Burke Destroyers 

not actively engaged in the Radar/Hull Study.14

The Navy believes that some of the differences in the threat environment 

result from the different timeframes for the Radar/Hull Study and the 

MAMDJF AOA; the MAMDJF AOA states that it is based on a 2024

through 2030 timeframe while the Radar/Hull Study states that it is based 

on a 2015 through 2020 timeframe. However, Navy officials also told us 

that the IAMD threats are actually emerging more rapidly than they had 

assumed in the MAMDJF AOA, which could mean that some of the 

MAMDJF AOA threats may be present earlier. The Navy does not 

document why the Radar/Hull Study based its analysis on a reduced 

threat environment compared to the MAMDJF AOA, since both studies 

are attempting to identify solutions to the same capabilities gap and set of 

requirements. Navy officials later told us that the assumption in the 

Radar/Hull Study was that no single Navy ship would likely have to deal 

with all the threats in the battlespace, compared to the threat environment 

in the MAMDJF AOA where more of a single-ship solution was 

considered. However, other Navy studies developed in a similar 

timeframe to the Radar/Hull Study describe a larger number of threats 

than the Radar/Hull Study. Further, while the Navy’s assumption may 

account for some of the quantitative differences between the Radar/Hull 

Study and all the other Navy studies we analyzed, it should have no 

bearing on the qualitative difference in the composition of the threat, since 

this is a variable that is independent of Navy concepts of operations and 

is a variable over which the Navy has no influence.

The system guideline 

documents for AMDR that were generated at approximately the same 

time as the Radar/Hull Study also included significantly more taxing 

tactical situations than the Radar/Hull Study, and in some cases they are 

even more stressing than those found in the MAMDJF AOA. The Office of 

Naval Intelligence also provided input to these AMDR system guidelines. 

 

14 Navy officials stated that the Office of Naval Intelligence provided information to the 

Radar/Hull Study team in two briefings on ballistic and cruise missile threats. However, in 

a written statement the Office of Naval Intelligence stated that they did not participate in 

the development or review of the Radar/Hull Study. 
 

Page 20 GAO-12-113 Arleigh Burke Destroyers 

According to the Navy and shipbuilders, the changes to the restarted 

DDG 51’s hull and mechanical systems appear less substantial than 

previous modifications to earlier DDG 51s. However, due in part to a 

break in production, an initially noncompetitive environment, and other 

factors, the restart ships are budgeted to cost more than previous DDG 

51 Flight IIA ships. While the shipbuilders’ planned production schedules 

are generally in line with past shipyard performance, the delivery 

schedule for the first restart ship (DDG 113) may be challenging because 

of a significant upgrade in the Aegis combat system, where major 

software development efforts are under way and a critical component has 

faced delays. Although the Navy plans to install and test this upgrade on 

an older DDG 51 (DDG 53) prior to installation on DDG 113, delays in 

these efforts could pose risks to a timely delivery in support of DDG 113 

and ability to mitigate risk. If this occurs, the Navy may need additional 

time to identify, analyze, and work to resolve problems with the combat 

system—adding pressure to the schedule for DDG 113. Even if current 

testing goes as planned, the Navy has not planned for realistic 

operational testing necessary to ensure that the Aegis upgrades are 

capable of performing IAMD against multiple ballistic and cruise missile 

targets. 

While the restart ships will have some changes to the ship’s design and 

physical structure, Navy officials told us that they are less substantial than 

prior modifications, despite changes to a large number of design 

drawings. The Navy has been building DDG 51s since the late 1980s, 

and over time the ship design has been modified, including additions such 

as helicopter hangars, additional missiles, and significant combat system 

upgrades. As shown in table 7, a large number of design drawing 

changes are required for the DDG 51 restart program, similar to those 

implemented as part of previous major upgrades, such as the upgrade 

from Flight II to Flight IIA (DDGs 79 and higher). While these design 

changes may not be complex, they affect numerous areas of the ship.

Restart Ships are 

Costlier than Recent 

DDG 51s and Face a 

Challenging Combat 

System Upgrade

The Navy Believes 

Proposed Hull and 

Mechanical Changes Are 

Less Substantial Than 

Previous Modifications
 

Page 21 GAO-12-113 Arleigh Burke Destroyers 

Table 7: Selected Major DDG 51 Changes and Corresponding Design Changes

Hull number

Number of drawing 

changes Description of changes

DDG 79 2705 Addition of dual helicopter hangars and moving radar arrays, and replacement of 

crane used to move missiles with additional missiles.

DDG 85 659 Physical dimensions of the ship unchanged, major Aegis combat system upgrade.

DDG 103 1898 Physical dimensions of the ship unchanged, major Aegis upgrade.

DDG 113 1175 Physical dimensions of the ship unchanged, major Aegis upgrade, modest hull and 

mechanical changes (e.g. anchor deletion)

a

Source: GAO analysis of Navy data. 

a

 Design work for DDG 113 is still underway, so this number is estimated. 

According to shipyard officials, most design drawings for the restart ships 

will have applicability from previous hulls and will not require re-design, 

but the Navy told us that they currently expect 1175 drawings will be 

changed, and the design work is still underway. As figure 4 shows, some 

of the changes will affect the topside of the ship, and include removing 

some redundant or unneeded equipment from the ship (e.g. the forward 

kingpost and port anchor) while internal changes largely pertain to 

upgrading the Aegis combat system with new computer displays and 

computer cabinets. 

Figure 4: Proposed Design Changes for Restart Ships
 

Page 22 GAO-12-113 Arleigh Burke Destroyers 

The Navy has budgeted approximately $17.5 billion for the 10 Flight IIA 

restart ships.15 The first three restart ships, beginning with DDG 113, cost 

45 percent more than recently delivered DDG 51s.16 DDG 113 through 

DDG 115 are currently budgeted to cost a total of $5.8 billion, which is 

approximately $1.8 billion higher than the last three DDG 51s built.17

Unlike the previous 24 ships, the restart ships are not part of multiyear 

ship procurements, which can be more cost-efficient due to economies of 

scale. The Navy partially attributes the increase in procurement costs to a 

4-year gap in production. Construction of the last DDG 51s began in late 

2007 and production on DDG 113 began in July 2011. The shipbuilders 

and the Navy anticipate that additional labor hours will be required to 

build DDG 113-115 due in part to a loss of experienced workers who will 

have been laid off or otherwise left the shipyard during the production 

gap. This attrition—along with changes in equipment and processes 

associated with the shutdown of the production line—contributes to a loss 

of learning whereby a less experienced and less efficient workforce 

requires more time to complete tasks with additional hours spent on 

rework. While the Navy in part attributes the higher ship costs to the need 

for additional labor hours to build the ships, it does not associate 

increases with significant changes in the supplier base. In general, the 

Navy found the supplier base for ship equipment was primarily intact, with 

most of the DDG 51 suppliers still in production, which allowed the Navy 

to get the equipment it needed at prices it considered reasonable.18

The Navy’s initial noncompetitive acquisition strategy also contributed to a 

higher budgeted cost for the first three restart ships. In response to the 

truncation of the DDG 1000 program, the Navy and the two shipyards had 

In 

cases where the suppliers were no longer available, the Navy 

recompeted some key equipment contracts in order to maximize value 

and to compensate for some modest changes in its supplier base.

 

15 In then-year dollars. 

16 The Navy calculates this difference to be 27 percent based on future anticipated budget 

savings and differences in inflation indices.

17 In constant fiscal year 2012 dollars. Cost includes the procurement of the ship, 

including ship construction, design, change orders and government-furnished equipment. 

Research and development (R&D) costs are not included. 

18 Some suppliers were keeping their production lines open due to the Aegis 

modernization program, a backlog of orders, or the fact that suppliers were producing and 

selling equipment to foreign navies such as Australia.

Restart Ships Cost More 

Than Previous DDG 51 

Flight IIA Ships
 

Page 23 GAO-12-113 Arleigh Burke Destroyers 

agreed to allocate the construction of DDG 1000s and the first three DDG 

51s (DDG 113-115) between Bath Iron Works and Ingalls Shipbuilding to 

ensure workload stability between the shipyards.19 The parties agreed, 

subject to negotiation of fair and reasonable prices and other conditions, 

that Bath Iron Works would be responsible for all of the remaining DDG 

1000 design and construction work and construction of DDG 115, while 

Ingalls Shipbuilding would construct DDG 113 and DDG 114.20

In an effort to generate more competitive pricing, the Navy changed its

acquisition strategy in May 2011 to “competitively allocate” DDG 114 and 

115. This strategy change allowed the Navy to award contracts to each 

shipbuilder using a Profit Related to Offers strategy, whereby the 

shipbuilder that submitted the lowest cost bid for its allocated ship would 

receive a higher target profit percentage, and the shipbuilder that 

submitted the lower bid for DDG 116 would be awarded an option for 

construction of that ship. The Navy believed that through its new strategy 

it would be able to reduce the costs for DDG 114 and DDG 115, noting its 

successful use on 30 previous DDG 51 ships since 1996. Additionally, the 

strategy allowed the Navy to award both DDG 114 and DDG 115 to one 

shipbuilder in the event that it failed to arrive at a fair and reasonable 

price with each shipbuilder on its allocated ship. After prolonged 

negotiations with the shipyards and over a year delay from when the 

Navy planned to award the DDG 113 contract, the Navy awarded a 

contract to Ingalls Shipbuilding for DDG 113 in June 2011 and DDG 114 

in September 2011, and awarded a contract to Bath Iron Works for DDG 

115 in September 2011, with an option to build DDG 116. 

After 

these first three ships, the Navy intended to competitively award contracts 

for future surface combatants. The Navy assumed that it would pay a 

premium for the first three ships because a lack of competition between 

the two shipyards would drive up costs. Indeed, Navy officials noted that 

a noncompetitive environment, along with disagreements on the impact of 

the production gap, were among the reasons that initial bids from the 

shipbuilders were unreasonably high and in excess of Navy budget 

estimates. 

 

19 Prior to the truncation Bath Iron Works was responsible for building the majority of DDG 

1000, while Ingalls Shipbuilding was responsible for the majority of DDG 1001. The 

shipbuilders shared in designing the ship. The Navy had planned to compete DDG 1002 

and the remaining four ships. 

20 Ingalls Shipbuilding would also continue to build the composite deckhouse and hanger 

for all three DDG 1000 ships. 
 

Page 24 GAO-12-113 Arleigh Burke Destroyers 

The Navy expects DDG 113 to be built in 47 months (from the start of 

construction to delivery), DDG 114 in 41 months, and DDG 115 in 58 

months. As show in figure 5, Ingalls Shipbuilding—which is building the 

two first ships —averages 41 months to build a DDG 51, though in recent 

years has required more time due in part to after-effects of Hurricane 

Katrina. Bath Iron Works typically requires an average of closer to 54 

months. Navy officials told us that this longer 58 month schedule planned 

for DDG 115 is due to the shipyard beginning construction earlier than 

planned in part to maintain stability in the shipyard labor force, while

maintaining the delivery date.

Figure 5: Historic DDG 51 Construction Durations

The schedules, while in line with past performance, are contingent on 

achieving an optimum build sequence, meaning the most efficient 

schedule for constructing a ship, including building the ship from the 

bottom up and installing ship systems before bulkheads have been built 

and when spaces are still easily accessible. Shipbuilders generate 

specific dates for when systems need to arrive at the shipyard in order to 

take advantage of these efficiencies. According to shipyard officials, 

approximately 10 percent to 12 percent of the suppliers for the restart 

ships will be new vendors. Some key pieces of equipment—like the main 

reduction gear, the machinery control system, and the engine controllers 

Restart Production 

Schedules Appear in-Line 

with Past Shipyard 

Performance 
 

Page 25 GAO-12-113 Arleigh Burke Destroyers 

—will now be government-furnished equipment, meaning that the Navy 

will be responsible for ensuring an on-time delivery to the shipyard, not 

the shipbuilder.21 For the main reduction gear, the Navy is now 

contracting with a company that bought the gear production line from the 

past supplier, and while this supplier builds reduction gears for San 

Antonio class ships, it does not have experience building DDG 51 main 

reduction gears. An on-time delivery of this key component is particularly 

important to the schedule because it is installed early in the lower 

sections of the ship. A delay in a main reduction gear could result in a 

suboptimal build sequence as the shipbuilder has to restructure work to 

leave that space open until the gear arrives. The Defense Contract 

Management Agency reports production of the first gear ship set is 

progressing well, and that Navy officials are tracking the schedule closely. 

A major change for the restart ships is a significant upgrade to the Aegis 

combat system currently under way. This upgrade, known as Advanced 

Capability Build 12 (ACB 12), will be retrofitted on some of the current 

fleet of DDG 51s (starting with DDG 53); following DDG 53, the upgrade 

will also be installed on the restart ships (starting with DDG 113). The 

retrofit on DDG 53 will provide the Navy with a risk mitigation opportunity, 

since any challenges or problems can be identified and resolved prior to 

installation on DDG 113. The Navy believes this is the most complex 

Aegis upgrade ever undertaken and will enable the combat system to 

perform limited IAMD for the first time. This upgrade will also move the 

Navy towards a more open architecture combat system, meaning that 

there will be a reduction of proprietary software code and hardware so 

that more elements can be competitively acquired in the future. To date, 

Lockheed Martin maintains intellectual property rights over some Aegis 

components. ACB 12 requires both software and hardware changes, and 

consists of three related development efforts: (1) development of a 

multimission signal processor (MMSP), (2) changes to the ballistic missile 

suite (BMD 5.0), and (3) changes to the Aegis combat system core. While 

the Navy manages the development of MMSP and ACB 12, MDA 

manages the development of BMD 5.0. Table 8 describes each of the 

three efforts.

 

21 Main reduction gears function like a transmission and reduce the high-speed rotations 

from the engines to a lower speed that can be used to turn the ship’s propellers.

Combat System Upgrade 

Has Faced Delays, and Key 

Testing Is Undefined
 

Page 26 GAO-12-113 Arleigh Burke Destroyers 

Table 8: ACB 12 Components 

Element Description

MMSP Radar signal processor that enables IAMD by simultaneously processing radar inputs from ballistic and 

cruise missile targets. This component is the essential enabler for providing initial IAMD capability.

BMD 5.0 Upgraded set of algorithms and software integrated for the first time into the combat system. 

Development managed by MDA. 

Aegis Modernization Overall combat system upgrade in addition to MMSP and BMD 5.0, including new workstations and 

display screens.

Source: GAO analysis of Navy and contractor data. 

While the Navy has made significant progress in developing the 

components of ACB 12, MMSP is proving more difficult than estimated 

and is currently 4 months behind schedule, with $10 million in cost growth 

realized and an additional $5 million projected. A substantial amount of 

software integration and testing remains before MMSP can demonstrate 

full capability and is ready for installation on DDG 53—and later DDG 

113. While all of the software has been developed, only 28 percent of the 

eight software increments have been integrated and tested. The 

integration phase is typically the most challenging in software 

development, often requiring more time and specialized facilities and 

equipment to test software and fix defects. According to the Navy, the 

contractor underestimated the time and effort required to develop and 

integrate the MMSP software. In December 2010, MMSP was unable to 

demonstrate planned functionality for a radar test event due to integration 

difficulties, and MMSP more recently experienced software problems 

during radar integration which resulted in schedule delays. In response, 

the contractor implemented a recovery plan, which included scheduling 

additional tests and replanning the remaining work to improve system 

stability. However, the recovery plan compresses the time allocated for 

integrating MMSP with the rest of the combat system from 10 months to 6 

months. 

In order to meet schedule goals and mitigate software development risk in 

the nearterm, the contractor also moved some development of MMSP 

capability to future builds. However, this adds pressure to future 

development efforts and increases the probability of defects and 

integration challenges being realized late in the program. The contractor 

already anticipates a 126 percent increase in the number of software 

defects that it will have to correct over the next year, indicating the 

significant level of effort and resources required for the remaining 

development. According to the program office, the high level of defects 

Delays in Aegis Combat System 

Development May Compromise 

Installation and Testing 

Schedule, Shifting Risk to DDG 

113 
 

Page 27 GAO-12-113 Arleigh Burke Destroyers 

projected is due to the complexities of integrating and testing with Aegis. 

Each defect takes time to identify and correct, so a high level of defects 

could result in significant additional work and potentially further delays if 

the contractor cannot resolve the defects as planned. The Navy believes 

the schedule risk associated with this increase is understood and 

anticipates no further schedule impacts. However, the Defense Contract 

Management Agency, which is monitoring the combat system 

development for the Navy, has characterized the MMSP schedule as high 

risk. 

As shown in figure 6 below, the Navy will not test ACB 12’s IAMD 

capabilities with combined live ballistic and cruise missile tests until after 

it certifies the combat system. Certification is an assessment of the 

readiness and safety of ACB 12 for operational use including the ability to 

perform Aegis ship missions. The Navy and MDA plan to determine future 

opportunities for additional testing to prove the system. The Navy plans 

to leverage a first quarter fiscal year 2015 test that MDA does not actually 

characterize as an IAMD test to demonstrate IAMD capabilities.
 

Page 28 GAO-12-113 Arleigh Burke Destroyers 

Figure 6: Timeline of Aegis Upgrade Installation and Testing Events 

The Navy initially planned to test the combat system’s IAMD tracking 

capability during a BMD test event to occur by third quarter fiscal year 

2013. The test—tracking and simulated engagement of BMD and air 

warfare targets—would have provided confidence prior to certification of 

ACB 12 that the software worked as intended. However, this event was 

removed from the test schedule The Navy now plans to test tracking and 

simulated IAMD engagement capability during a BMD test event in third 

quarter 2014. According to the Navy, this is the earliest opportunity for 

sea-based testing of the ACB 12 upgrade installed on DDG 53. This 

event will help demonstrate functionality and confidence in the system, 

but only allows five months between the test and certification of the 

system to resolve any problems that may be identified during testing. The 

Navy and MDA plan on conducting a live ballistic missile exercise in 

second quarter fiscal year 2014, this will only test the combat system’s 

BMD capability, not IAMD. Consequently, the Navy will certify that the 

combat system is mission ready without validating with live ballistic and 

cruise missile targets that it can perform the IAMD mission. The first 
 

Page 29 GAO-12-113 Arleigh Burke Destroyers 

IAMD test with live targets is not scheduled until first quarter fiscal year 

2015. 

Delays in MMSP could also lead to concurrence between final software 

integration and the start of ACB 12 installation on DDG 53. Although the 

Navy has stated that the contractor is currently on schedule, if the 

contractor is unable to resolve defects according to plan, Aegis Light-Off 

(when the combat system is fully powered on for the first time) on DDG 

53 could slip or the test period could move closer to the start of 

installation on DDG 113, which could limit risk mitigation opportunities. 

Contractor officials told us that they plan to deliver the combat system 

hardware to the shipyard for installation on DDG 113 in May 2013. While 

the Navy believes the current schedule allows time for the Navy and 

contractor to remedy any defects or problems found with ACB 12 before it 

is scheduled to be installed on DDG 113, we have previously reported 

that concurrent development contributes to schedule slips and strains 

resources required to develop, integrate, test, and rework defects, which 

could encroach into this buffer.22

Additionally, if DDG 53 is not available when currently planned to begin its 

upgrade, this process could also be delayed. DDG 53’s upgrade schedule 

already slipped from May 2012 to September 2012, and any significant 

shifts could mean further schedule compression, or if it slipped past the 

start of installation on DDG 113 this new-construction ship could become 

the ACB 12 test bed, which would increase risk.

At present, DOD weapons testers and Navy and MDA officials are unsure 

to what extent the new IAMD capabilities of Aegis will be fully 

operationally tested and evaluated. Operational testing involves the 

employment of a new system in a realistic operational environment to 

determine the operational effectiveness and suitability of the system. This 

testing is required to: (1) determine if performance thresholds are met, (2) 

assess impacts to combat operations, and (3) provide additional 

information on the system’s operational capability. Since the ACB 12 

upgrade of Aegis is central to the combat capabilities of the ship, Navy 

weapons testers believe that Aegis should have a rigorous operational 

 

22 GAO, Defense Acquisitions: Significant Challenges Ahead in Developing and 

Demonstrating Future Combat System's Network and Software, GAO-08-409, 

(Washington, D.C.: Mar. 7, 2008) and Joint Strike Fighter: Restructuring Places Program 

on Firmer Footing, but Progress Still Lags, GAO-11-325 (Washington, D.C.: Apr. 7, 2011).

Navy Has Not Fully Planned for 

Realistic Operational Testing of 

Aegis IAMD Capabilities
 

Page 30 GAO-12-113 Arleigh Burke Destroyers 

testing program—similar in scope to what was done for the first DDG 

51s—in order to validate that the combat system still functions in all 

areas. According to DOD officials, there should be a high level of 

coordination between the Navy and MDA with regard to testing the IAMD 

capability of ACB 12. However, creation of robust test plans for IAMD is 

complicated because of the division of responsibility between MDA and 

the Navy. While IAMD consists of both defense against cruise missile and 

aircraft threats and BMD, MDA is responsible for funding and testing BMD 

functionality while the Navy is responsible for funding and testing 

everything else. 23

Since Navy assessments include the possibility of IAMD engagements 

with multiple-missile threats, DOD weapons testers agree that a robust, 

operationally relevant test of IAMD capabilities should include a test with 

multiple, simultaneous BMD and air warfare targets. However, neither the 

Navy nor MDA has such a test in their current plans, nor, according to 

MDA officials, has such a test ever occurred.

 

24

 

23 Because MDA has not yet formally entered the defense acquisition cycle, it has not

followed the procedures under DOD Instruction 5000.02, Operation of the Defense 

Acquisition System, and does not generate a Test and Evaluation Master Plan like the 

Navy which is subject to Director, Operational Test and Evaluation review and approval. 

MDA does prepare an Integrated Master Test Plan. 

The IAMD test event in 

first quarter fiscal year 2015 will only test the combat system’s capability 

against a single ballistic missile and cruise missile target—not multiple 

targets. According to MDA officials, the focus of MDA testing is to validate 

BMD performance, not IAMD performance. MDA officials have stated that 

MDA test assets are very expensive, and the agency does not know how 

the Navy intends to validate the performance of IAMD capabilities, though 

they have stated that they will try to support the Navy as best they can, 

and that they are currently assisting the Navy in developing strategies to 

test and characterize IAMD performance. The Navy’s proposed test plan 

includes acquiring three Aegis BMD targets to be fired and tracked with 

simulated cruise missile threats, which will allow the Navy to simulate 

ACB 12 performance in an IAMD environment. Though cost and other 

constraints may limit the practicality of live test events, DOD weapons 

testers told us that though Aegis testing and performance evaluation can 

24 According to MDA officials, the Aegis combat system first demonstrated the potential to 

be used for IAMD during a flight test on April 26, 2007, when Aegis engaged a BMD target 

and a target simulating a high-performance aircraft, but this test did not use the ACB 12 

version of Aegis.
 

Page 31 GAO-12-113 Arleigh Burke Destroyers 

be done via modeling and simulation, the Navy still needs sufficient data 

from flight tests conducted in an operationally relevant environment in 

order to validate the simulation models with actual performance data. 

Similarly, MDA told us that model validation requires making comparisons 

between previous flight test results and the results of the models. Without 

actual operational tests, the Navy’s IAMD models will lack vital real-world 

data needed to validate how accurately they model the performance of 

Aegis. 

The Navy plans to procure the first of 22 Flight III DDG 51s in 2016 with 

the new AMDR and plans to achieve Flight III initial operational capability 

in 2023. Other than AMDR, the Navy has not identified any other 

technologies for inclusion on Flight III or decided on the size of AMDR. 

Although the analysis supporting Flight III discusses a 14-foot AMDR, 

senior Navy officials recently told us that a 12-foot AMDR may also be 

under consideration. While the Navy is pursuing a thoughtful approach to 

AMDR development, it faces several significant technical challenges that 

may be difficult to overcome within the Navy’s current schedule. The red 

team assessment of an ongoing Navy Flight III technical study found that 

the introduction of AMDR on DDG 51 leads to significant risks in the 

ship’s design and a reduced future capacity and could result in design 

and construction delays and cost growth on the lead ship. Further, the 

Navy’s choice of DDG 51 as the platform for AMDR limits the overall size 

of the radar to one that will be unable to meet the Navy’s desired 

(objective) IAMD capabilities. If the Navy selects a 12-foot AMDR—which 

may reduce the impacts on the ship and design—it may not be able to 

meet the requirements for AMDR as currently stated in the Navy’s draft 

capabilities document.25

 

25 While the capabilities document has been approved by the Navy, it has not been 

formally reviewed by the Office of the Secretary of Defense and is subject to change. 

Since AMDR has not yet reached its milestone decision, according to DOD officials, 

AMDR requirements could still change.

Given the level of complexity and the preliminary 

Navy cost estimates, the Navy has likely underestimated the cost of Flight 

III. However, since the DDG 51 program is no longer in the DOD 

milestone review process, decision makers currently cannot take 

advantage of knowledge gained through a thorough review of the 

program typically provided at a milestone. Further, since the Navy is 

responsible for acquisition oversight of the program, there is no 

Flight III Cost and 

Technical Risks Pose 

Challenges for 

Oversight
 

Page 32 GAO-12-113 Arleigh Burke Destroyers 

requirement for a DOD-level assessment before making further 

investments in the program.

AMDR represents a new type of radar for the Navy, which the Navy 

believes will bring a significantly higher degree of capability than is 

currently available to the fleet. AMDR is to enable a higher degree of 

IAMD than is possible with the current legacy radars. Further, the Navy 

believes that through the use of active electronically scanned array 

radars, AMDR will be able to “look” more places at one time, thus 

allowing it to identify more targets with better detection sensitivity.26

• AMDR-S: a 4 faced S-Band radar providing volume search for air 

and ballistic missile defense; 

It will 

also allow the radar to view these targets with better resolution. AMDR is 

conceived to consist of three separate parts: 

• AMDR-X: a 3 faced, 4-foot by 6-foot X-Band radar providing 

horizon search (as well as other tasks such as periscope and 

floating mine detection); and 

• Radar suite controller: interface to integrate the two radars and 

interface with the combat system.

Figure 7 depicts a notional employment of AMDR’s two radar bands. 

Three contractors are under contract to mature and demonstrate the 

critical AMDR-S radar technology required; the acquisition of the AMDRX portion is still in the preliminary stage, and the Navy plans to award a 

contract for it in fiscal year 2012.

 

26 Radar sensitivity is a measure of how well the radar can detect an object at a distance. 

A more sensitive radar can detect smaller objects at a range farther from the radar given a 

fixed resource consumption. It is a function of radar power and radar aperture (size).

The Navy Is Pursuing a 

Thoughtful Approach to 

AMDR, but Success Is 

Contingent on a Number of 

Technological 

Advancements
 

Page 33 GAO-12-113 Arleigh Burke Destroyers 

Figure 7: Notional DDG 51 Flight III with AMDR 

The Navy recognized the risks inherent in the AMDR-S program early on, 

and implemented a risk mitigation approach to help develop and mature 

specific radar technologies that it has identified as being particularly 

difficult. Additionally, the Navy used an initial AMDR-S concept 

development phase to gain early contractor involvement in developing 

different concepts and earlier awareness of potential problems. In 

September 2010, the Navy awarded three fixed-priced incentive contracts 

to three contractors for a 2-year technology development phase. All three 

contractors are developing competing concepts with a goal of maturing 

and demonstrating S-Band and radar suite controller technology 

prototypes. In particular, the contractors are required to demonstrate 

performance and functionality of radar algorithms in a prototype one-fifth 

the size of the final AMDR-S. 

The Navy has estimated that AMDR will cost $2.2 billion for research and 

development activities and $13.2 billion to procure at most 24 radars. At 

the end of the 2-year phase, the Navy will hold a competition leading to 

award of an engineering and manufacturing contract to one contractor. 
 

Page 34 GAO-12-113 Arleigh Burke Destroyers 

As shown in figure 8, AMDR is first scheduled to be delivered to a 

shipyard in fiscal year 2019 in support of DDG 123—the lead ship of 

Flight III.

Figure 8: AMDR Schedule 

AMDR-S relies on several cutting-edge technologies. Three of the most 

significant of these pertain to digital beamforming, the transmit/receive 

modules, and the radar/combat system interface. Table 9 highlights these 

technologies and key challenges.
 

Page 35 GAO-12-113 Arleigh Burke Destroyers 

Table 9: AMDR Technologies and Key Technical Challenges

Technology Description Key technical challenges

Digital 

beamforming 

• Advanced software algorithms 

digitize the radar signal, enabling 

simultaneous generation and 

processing of multiple beams, 

increasing radar resources 

available for multiple missions.a

• Without this technology, requirements may have to be reduced and 

radar may be less efficient in littoral or dense electromagnetic 

interference environments.

This allows beams to be modified 

to help eliminate interference or 

clutter in an electromagnetic 

interference environment. 

• This technology has never been demonstrated to the size and 

architecture planned for AMDR.

Transmit/ receive 

modules 

• Individual units that emit the radar 

signal from the radar. 

• AMDR transmit/receive modules 

must generate significantly more 

radio frequency power over 

modules in the DDG 1000’s 

Volume Search Radar, and 10 

percent more efficiency to enable 

AMDR’s required capabilities.b

• To achieve this increased level, the contractors may use Gallium 

Nitride-based semiconductors, which may provide higher power and 

efficiency than current material. This material is relatively new and 

long-term reliability is unknown. It has never been used in a radar of 

this scale.

 

• Inability to use Gallium Nitride may require use of current materials, 

and thus additional ship power and cooling. Alternatively, 

performance requirements may be set lower with a spiral 

development plan to achieve the objective power levels at a later 

date. 

• Past radar programs (Volume Search Radar and the Cobra Judy 

Replacement radar) have needed more time to test and mature 

transmit/receive modules than estimated, causing cost and schedule 

growth.

Combat system 

integration

c

• Aegis Combat System requires 

modification in order to 

accommodate and exploit AMDR’s 

additional capability and mission 

sets (e.g. periscope detection). 

• Software integration and testing is a lengthy effort and is typically the 

most challenging phase of software development, requiring 

specialized skills and integration test lines.

• The Navy has yet to fully identify what interfaces will be impacted or 

to develop estimates of the level of effort that will be required. A 

Navy/industry combat system integration working group was 

established but has had a limited role to date. Integration will likely be 

challenging because multiple technology developers and two 

program offices will have to work closely together.

• Lack of test and evaluation assets early in process could result in 

shipboard integration issues.

Source: GAO analysis of Navy data. 

a

 Radar resources are a percentage that radar arrays are required to be dedicated to a particular task. 

For instance, if a searching task takes a total of 1 second and is repeated every 4 seconds, that task 

would consume 25 percent of radar resources. 

b Radar efficiency means that it can operate at higher levels of power with less demand for electricity 

and less heat generation that requires cooling. 

c The Cobra Judy Replacement program is a ship that carries a powerful dual band radar suite that is 

used for ballistic missile treaty verification and to provide data collection of ballistic missiles in flight. 

The ship consists of an X and S-band radar with a common radar controller. 

Though the Navy has been pursuing risk mitigation efforts related to 

some key AMDR technologies, realizing AMDR will require overcoming 
 

Page 36 GAO-12-113 Arleigh Burke Destroyers 

several significant technical challenges. For example, though the Navy 

worked with the United Kingdom on a radar development program to 

demonstrate large radar digital beamforming, including limited live target 

testing, the technical challenges facing the development of AMDR have 

not been fully mitigated by these efforts. The joint radar development 

program used a digital beamforming architecture different than what is 

intended for AMDR, and the demonstrator was much smaller than what is 

envisioned for AMDR-S. Further, the Navy’s previous effort also did not 

demonstrate against BMD targets, which are the most stressful for the 

radar resources. The Navy told us that the contractors have been 

successful in their AMDR development efforts to date, and that power and 

cooling requirements may be less than initially estimated. However, 

substantial work remains, and failure to achieve any of these technologies 

may result in AMDR being less effective than envisioned. AMDR 

development is scheduled for 10 years, compared with 9 years for the 

DDG 1000’s VSR.27

Integration with the Aegis combat system may also prove challenging: 

Aegis currently receives data from only a single band SPY-1D(V) radar, 

and adding AMDR will require modifying Aegis to receive these data, to 

accommodate some new capabilities, and to integrate Aegis with the 

radar suite controller. The Navy has deferred this integration, as it 

recently decided to eliminate AMDR integration work from its upcoming 

Aegis upgrade (ACB 16) contract, although Navy officials pointed out that 

this work could be started later under a separate contract. If the Navy 

does not fund AMDR integration work in ACB 16, this work may not be 

under way until the following ACB upgrade, which could be completed in 

2020 at the earliest if the Navy remains on the same 4 year upgrade 

schedule. With an initial operating capability for Flight III planned for 

2023, this could leave little margin for addressing any problems in 

enabling AMDR to communicate with the combat system.

 

27 This included development and land-based testing for VSR.
 

Page 37 GAO-12-113 Arleigh Burke Destroyers 

DDG 51 is already the densest surface combatant class; density refers to 

the extent to which ships have equipment, piping, and other hardware 

tightly packed within the ship spaces.28

The addition of AMDR and the supporting power and cooling equipment 

will significantly impact the design of Flight III. For example, additional 

large cooling units—each approximately 8 feet by 6 feet—required to 

facilitate heat transfer between the radar coolant and the ship’s chilled 

water system will have to be fit into the design. Similarly, a new electrical 

architecture may be required to power AMDR, which would result in 

changes to many electrical and machinery control systems and the 

addition of a fourth large generator. The red team assessment of the 

Navy’s ongoing Flight III technical study found that modifying DDG 51 to 

accommodate these changes will be challenging with serious design 

complexity. Since Flight III design work is just in the concept phases, it is 

currently unknown how the additional cooling and power generating units 

added to support AMDR will be arranged, or any impact they will have on 

ship spaces and habitability. For example, the Navy is currently 

considering five possible cooling unit configurations. Of these, one cannot 

According to a 2005 DODsponsored shipbuilding study, the DDG 51 design is about 50 percent 

more dense and complex than modern international destroyers. Highdensity ships have spaces that are more difficult to access; this results in 

added work for the shipbuilder since there is less available space to work 

efficiently. As a legacy design, the ship’s physical dimensions are already 

fixed, and it will be challenging for the Navy to incorporate AMDRs’ arrays 

and supporting equipment into this already dense hullform. Some 

deckhouse redesign will be necessary to add the additional radar arrays: 

a current DDG 51 only carries four SPY radar arrays, while Flight III is 

envisioned to carry four AMDR-S arrays plus three additional AMDR-X 

band arrays. The deckhouse will need to be redesigned to ensure that 

these arrays remain flush with the deckhouse structure. Adding a 14-foot 

AMDR to DDG 51 will also require significant additional power generating 

and cooling equipment to power and cool the radar. Navy data show that 

as a result of adding AMDR the ships will require 66 percent more power 

and 81 percent more cooling capacity than current DDG 51s. If the Navy 

elects to use a smaller AMDR for Flight III these impacts may be reduced, 

but the ship would also have a significant reduction in radar performance.

 

28 Measured in terms of pounds of weight per cubic foot (lbs/cf), the DDG 51 class has an 

outfit density of close to 8 lbs/cf, which is more than the DDG 1000 and FFG 7 classes, 

which are approximately 7 lbs/cf, and the CG 47 class, which is approximately 7.5 lbs/cf. 

Physical Constraints Will 

Result in a Complicated 

Flight III Design and 

Construction Process and 

May Increase Ship Costs
 

Page 38 GAO-12-113 Arleigh Burke Destroyers 

be arranged within the existing spaces, another will be very difficult to 

arrange, and three of these options will require significant changes to the 

arrangements of the chilled water systems. Similarly, all of the options the 

Navy is considering for possible power generation options will require 

rearrangement and some impact on other spaces, including 

encroachment on storage and equipment rooms. Navy officials told us 

that hybrid electric drive is being researched for Flight III, and the Navy 

has awarded a number of contracts to study concepts.29

Not only can density complicate design of the ship as equipment needs to 

be rearranged to fit in new items, but Navy data also show that 

construction of dense vessels tends to be more costly than construction 

of vessels with more open space. For example, submarine designs are 

more complicated to arrange and the vessels are more complicated and 

costly to build than many surface ships. DDG 1000 was designed in part 

to have reduced density, which could help lower construction costs. 

According to a 2005 independent study of U.S. naval shipbuilding, any 

incremental increase in the complexity of an already complex vessel 

results in a disproportionate increase in work for the shipbuilder, and 

concluded that cost, technical and schedule risk, and the probability of 

cost and schedule overrun all increase with vessel density and 

complexity.

The Navy told us 

that this technology has the ability to generate an additional 1 megawatt 

of electricity, and thus could potentially obviate the need for an additional 

generator to support AMDR. However, adding hybrid electric drive would 

require additional design changes to accommodate the new motors and 

supporting equipment.

30

The addition of equipment to Flight III adds weight to the ship, and adding 

the large, heavy AMDR arrays to the deckhouse will also change the 

ship’s center of gravity—defined as the height of the ship’s vertical center 

of gravity as measured from the bottom of the keel, including keel 

Therefore, further adding to the density of DDG 51 to 

incorporate AMDR is likely to result in higher construction costs and 

longer construction schedules than on Flight IIA ships. 

 

29 Hybrid electric drive uses an electric motor integrated through the main reduction gear 

to reduce the use of the ship’s primary gas turbines to provide both propulsion (which in 

turn can reduce fuel consumption) and additional electrical power. This equipment may 

also be backfit on prior ships.

30 First Marine International Findings for the Global Shipbuilding Industrial Base 

Benchmarking Study, First Marine International (London: August 2005). 
 

Page 39 GAO-12-113 Arleigh Burke Destroyers 

thickness. Weight and center of gravity are closely monitored in ship 

design due to the impact they can have on ship safety and performance. 

The Navy has required service life allowances (SLA) for weight and 

center of gravity for ships to allow for future changes to the ships, such as 

adding equipment and reasonable growth during the ship's service life—

based on historical data—without unacceptable compromises to hull 

strength, reserve buoyancy, and stability (e.g., tolerance against 

capsizing). Adding new systems or equipment may require mitigating 

action such as removing weight (e.g., equipment, combat systems) from 

the ship to provide enough available weight allowance to add desired new 

systems or equipment. A reduced center of gravity may require mitigation 

such as adding additional weight in the bottom of the ship to act as 

ballast, though this could also reduce the available weight allowance. 

These changes all require redesign which can increase costs, and this 

design work and related costs can potentially recur over the life of the 

ship. 

The Navy is considering a range of design options to deal with adding 

AMDR and its supporting power and cooling equipment. None of the DDG 

51 variants under consideration as part of an ongoing Navy study meet 

Navy SLA requirements of 10 percent of weight and 1 foot of center of 

gravity for surface combatants. Figure 9 shows that several variants

provide less than half of the required amounts. 
 

Page 40 GAO-12-113 Arleigh Burke Destroyers 

Figure 9: SLA of Navy DDG 51 Flight III Concepts

a

The “most SLA” variant has the highest percentage of weight margin and the second best KG 

margin. 

The Navy has determined that only by completely changing the material 

of the entire fore and aft deckhouses and the helicopter hangars to 

aluminum or composite as well as expanding the overall dimensions of 

the hull (especially the width, or beam) can the full SLA be recovered for 

a Flight III with a 14-foot AMDR. Though a decision has not yet been 

made, at this time Navy officials do not believe that a composite or 

aluminum deckhouse will be used. The Navy also told us that removing 

combat capability from DDG 51 may be required in an effort to manage 

weight after adding AMDR, effectively reducing the multimission 

functionality of the class. Navy officials stated that SLA has not always 

been required, and that this allowance is included in designs to eventually 

be consumed. They pointed to other classes of ships that were designed 

with less than the required SLA margins and that have performed 

adequately. However, as shown in Table 10, our analysis of the data 

indicates that these ships have faced SLA-related issues. 
 

Page 41 GAO-12-113 Arleigh Burke Destroyers 

Table 10: SLA Considerations with Select Ship Classes

Class Description 

CG 47 

Ticonderoga 

• Based on DD 963 Spruance class hullform. According to a naval 

architect on the Navy’s technical study red team, adding Aegis 

compromised weight and center of gravity margins, requiring 

weight removal from the deckhouse to compensate. This weight 

removal in part contributed to cracking and buckling of 

deckhouses and superstructure. 

• CG 47-CG 51 had most significant SLA impacts. These hulls were 

retired with an average life of 20 years; structural modernization 

needed so remaining hulls can reach 35-year service life. 

• No CG 47’s can accept an increase in weight or a rise of center of 

gravity due to reduced SLA; any new equipment will require 

weight and center of gravity adjustments.

FFG 7 Oliver 

Hazard Perry 

• 21 of 49 have been retired early after an average lifespan of only 

17 years.

• Reduced SLA means majority of remaining hulls cannot accept 

weight or center of gravity growth.

a

Source: GAO analysis of Navy data. 

a

According to Navy data, delivery weight of DDG 51s has gotten 

considerably heavier over the course of building the class, with current 

51s weighing approximately 700-900 long tons (a measure of ship 

displacement) more than the first DDG 51s. Further, while the current 

DDG 51s all can accept both an increase in weight or rise in the center of 

gravity, the ships are already below the required center of gravity 

allowances, though Navy officials told us that this could be corrected with 

ballasting if the Navy opted to fund the change. In commenting on the 

ongoing Navy study, the independent red team identified reduced SLA as 

a significant concern for Flight III, and noted that if the Navy does not 

create a larger hullform for Flight III, any future ship changes will be 

significantly constrained. 

 Other factors that can contribute to early decommissioning are structural integrity of the hull, costs to 

upgrading the combat systems, condition of propulsion machinery, and cost to operate the vessel. 

The ships of the FFG 7 class are expected to operate for 30 years. 

Flight III with a 14-foot AMDR will not be powerful enough to meet the 

Navy’s objective, or desired IAMD capabilities. The shipyards and the 

Navy have determined that 14-foot radar arrays are the largest that can 

be accommodated within the confines of the existing DDG 51 

configuration. Adding a radar larger than 14 feet to DDG 51 is unlikely 

without major structural changes to the ship. AMDR is being specifically 

developed to be a scalable radar—meaning that it can be increased in 

size and power to provide enhanced capability against emerging threats. 

Flight III Will Not Achieve 

Navy Desired IAMD 

Capabilities with No 

Future Ship Planned in the 

Near-Term 
 

Page 42 GAO-12-113 Arleigh Burke Destroyers 

According to AMDR contractors, the Navy had originally contracted for an 

investigation of a Variant 2 AMDR with a sensitivity of SPY+40, but this 

effort was cancelled. They added that the maximum feasible size of 

AMDR would be dictated by the ship and radar power and cooling 

demands, but that they had investigated versions as large as 36 feet. 

Leveraging AMDR’s scalability will not be possible on DDG 51 without 

major changes, such as a new deckhouse or adding to the dimensions of 

the hullform itself by broadening the beam of the ship or adding a new 

section (called a plug) to the middle of the ship to add length. Navy 

officials have stated that adding a plug to DDG 51 is not currently a viable 

option due to the complexity, and that a new ship design is preferable to a 

plugged DDG 51. 

The Navy has not yet determined the size of AMDR for Flight III, and two 

sizes are under consideration: a 14-foot AMDR with a sensitivity of 

SPY+15, and a 12-foot AMDR with a sensitivity of SPY+11. According to 

a draft AMDR Capability Development Document, the Navy has identified

that an AMDR with SPY+15 will meet operational performance 

requirements against the threat environment illustrated in the Radar/Hull 

Study. This document also notes that a significantly larger SPY+30 

AMDR is required to meet the Navy’s desired capability (known as 

objective) against the threat environment illustrated in the MAMDJF AOA. 

The Navy could choose to change these requirements. The MAMDJF 

AOA eliminated the DDG 51-based SPY+15 solution from consideration 

in part due to the limited radar capability, and identified that a radar closer 

to SPY+30 power with a signal to noise ratio 1,000 times better than 

SPY+0 and an array size over 20 feet is required to address the most 

challenging threats.31

 

31 Other reasons provided in the MAMDJF AOA for the elimination of the DDG 51 concept 

from consideration as a single ship concept include minimal opportunity for growth, limited 

service life, and constrained operational capabilities. For a discussion of the performance 

of SPY+15 and SPY+30 radars against the different threat environments, see Classified 

Annex C which will be made available upon request to those with the appropriate 

clearance and a validated need to know. 

If a 12-foot array is chosen, the Navy will be 

selecting a capability that is less than the “marginally adequate” capability 

offered by a SPY+15 radar as defined by the Radar/Hull Study red team 

assessment. According to Navy officials, only through adding additional 

square footage can the Navy effectively make large improvements in the 
 

Page 43 GAO-12-113 Arleigh Burke Destroyers 

sensitivity of the radar;32

According to senior Navy officials, since the MAMDJF AOA was released 

the Navy has changed its concept on the numbers of Navy ships that will 

be operating in an IAMD environment. Rather than one or a small number 

of ships conducting IAMD alone and independently managing the most 

taxing threat environments without support, the Navy now envisions 

multiple ships that they can operate in concert with different ground and 

space-based sensor assets to provide cueing for AMDR when targets are 

in the battlespace. This cueing would mean that the shooter ship could be 

told by the off-board sensors where to look for a target, allowing for earlier 

detection and increased size of the area that can be covered. According 

to the Navy, this concept—referred to as sensor netting—can be used to 

augment the reduced radar capability afforded by a 12 or 14-foot AMDR 

as compared to the larger radars studied in the MAMDJF AOA. For 

example, the Navy cited the use of the Precision Tracking Space System 

program as an example of sensors that could be leveraged. However, 

this program (envisioned as a constellation of missile tracking satellites) is 

currently in the conceptual phase, and the independent Radar/Hull Study 

red team stated that the development timeline for this system is too long 

to consider being able to leverage this system for Flight III. Navy officials 

told us that another option would be to leverage the newly completed 

Cobra Judy Replacement radar ship and its very powerful dual-band 

radar to provide cueing for DDG 51s. This cueing could allow the DDG 

51s to operate a smaller AMDR and still be effective. The Cobra Judy 

Replacement ship is comparatively cheaper than DDG 51s 

the SPY+30 radar considered in the MAMDJF 

AOA could only be carried by a newly designed cruiser or a modified San 

Antonio class ship, and only a modified DDG 1000 and could carry the 

approximately SPY+25 radar. According to the draft AMDR Capability 

Development Document, the Navy’s desired IAMD capability can only be 

accommodated on a larger, currently unspecified ship. As part of the 

MAMDJF AOA, the Navy identified that DDG 1000 can accommodate a 

SPY+25 radar. As part of a technical submission to the Navy, BIW—the 

lead designer for DDG 1000—also identified a possible design for a 21-

foot radar on DDG 1000. The Navy did not include a variant with this size 

radar in the Radar/Hull Study.

 

32 Navy officials explained that radar sensitivity scales as a cube of the size of the radar 

aperture. While improvements can also be made to the transmit/receive modules that emit 

the radar signal, Navy officials stated that this is a linear (not cubic) relationship and only 

adds marginal capability on the order of +1 or 2 dB.

Navy Plans to Leverage Offboard Sensors to Augment 

Radar Performance, but 

Concept Is Unproven
 

Page 44 GAO-12-113 Arleigh Burke Destroyers 

(approximately $1.7 billion for the lead ship), and was commercially 

designed and built. However, it is not a combatant ship, which would limit 

its employment in a combat environment and make it difficult to deploy to 

multiple engagement locations. 

Senior Navy officials told us that the concept of sensor netting is not yet 

well defined, and that additional analysis is required to determine what 

sensor capabilities currently exist or will be developed in the future, as 

well as how sensor netting might be conceptualized for Flight III.33

The Navy has added a future DDG 51 flight (known as Flight IV) to its 

annual long-range shipbuilding plan submitted to Congress, with 

procurement of 21 ships to begin in 2032. According to the Navy, this 

Flight IV ship could be notionally based on the DDG 51 hullform, but it 

may be largely or entirely a clean sheet design. DOD officials stated that 

no decisions have been made with respect to the capabilities of this future 

platform, and that Executive Office of the President and DOD decisions 

may ultimately dictate further analysis on the capabilities needed for 

future surface combatants. If additional studies are completed and 

materiel solutions are recommended, DOD officials stated that an AOA

may be warranted. Senior Navy officials told us that they do not know if 

Flight IV will carry a larger, more powerful radar or not or what the overall 

Sensor 

netting requires not only deployment of the appropriate sensors and for 

these sensors to work alone, but they also need to be able to share 

usable data in real-time with Aegis in the precise manner required to 

support BMD engagements. Though sharing data among multiple 

sensors can provide greater capabilities than just using individual standalone sensors, officials told us that every sensor system has varying 

limitations on its accuracy, and as more sensors are networked together 

and sharing data, these accuracy limitations can compound. Further, 

though there have been recent successes in sharing data during BMD 

testing, DOD weapons testers responsible for overseeing BMD testing 

told us that there have also been issues with sending data between 

sensors. Although sensor technology will undoubtedly evolve in the 

future, how sensor netting will be leveraged by Flight III and integrated 

with Navy tactics to augment Aegis and the radar capability of Flight III is 

unknown.

 

33 For more specifics on sensor netting, see Classified Annex C which will be made 

available upon request to those with the appropriate clearance and a validated need to 

know. 

No Navy Plans to Procure a 

More Capable Ship until Flight 

IV in 2032 
 

Page 45 GAO-12-113 Arleigh Burke Destroyers 

improvements in capabilities will be, even though AMDR is being built 

with the capability to be scaled up in size. In its recent annual long-range 

shipbuilding plan, the Navy currently estimates that its notional Flight IV 

ships will cost approximately $2.1 billion each—the same as the Flight III 

ships, which implies no expectations of changes to the hullform.34

Officials told us that a major consideration in the future will be electrical 

power. While Flight III will most likely not leverage technologies 

developed as part of the DDG 1000 program because of DDG 51’s 

design constraints, Navy officials stated that Flight IV may carry some 

form of the integrated power system developed for DDG 1000. The Navy 

examined the use of the integrated power system for Flight III in the Flight 

Upgrade Study, but found that it was not currently viable due to current 

component technology. The constrained nature of Flight III will likely limit 

the ability of the Navy to add future weapon technologies to these ships—

such as an electromagnetic rail gun or directed energy weapons as these 

technologies mature—unless the Navy wants to remove current weapon 

systems. For example, the ongoing Navy Flight Upgrade Study examined 

an option to add a small rail gun by removing the ship’s main 5-inch gun

and the forward 32-cell missile launcher system. It is unknown when 

these future technologies may be used. 

Navy 

officials told us that this amount was a placeholder. 

Costs of the lead Flight III ship will likely exceed current budget estimates. 

Although the Navy has not yet determined the final configuration for the 

Flight III ships, regardless of the variant it selects, it will likely need 

additional funding to procure the lead ship above the level in its current 

shipbuilding budget. The Navy has estimated $2.6 billion in its fiscal year 

2012 budget submission for the lead Flight III ship. However, this 

estimate may not reflect the significant design and construction 

challenges that the Navy will face in constructing the Flight III DDG 51s—

and the lead ship in particular. In fact, the Navy’s most current estimates 

for a range of notional Flight III options are between $400 million and $1 

billion more than current budget estimates, depending on the 

configuration and equipment of the variant selected (see table 11 below).

 

34 In constant fiscal year 2011 dollars.

Navy Acquisition 

Approach for Flight III Not 

Commensurate with Risks
 

Page 46 GAO-12-113 Arleigh Burke Destroyers 

Table 11: Differences in the Estimated Cost of the Lead DDG 51 Flight III Ship

2012 President’s Budget 2009 Radar-Hull Study 2011 Flight Upgrade Study

$2.6 billion $2.9 billion $3.0-3.6 billion a

Source: GAO analysis of Navy documentation.

b

Note: Shipbuilding and Conversion, Navy (SCN) in then year dollars for the lead ship. 

a

Compared with an estimated $3.4 billion for the DDG 1000 alternative. 

b

Represents the range of options currently under review. 

Further, across the entire flight of 22 ships, the Navy currently estimates 

Flight III research and development and procurement costs to range from 

$58.5 billion to $64.1 billion in constant 2012 dollars. However, the Navy 

estimated in its 2011 long-range shipbuilding plan to Congress that these 

same 22 ships would cost approximately $50.5 billion in constant 2012 

dollars. As shown in figure 10 below, depending on the extent of changes 

to hullform, the Navy may need at least $4.2 billion to $11.4 billion more 

to procure DDG 51 Flight III ships. 
 

Page 47 GAO-12-113 Arleigh Burke Destroyers 

Figure 10: Comparison of Procurement Costs for Flight III

Based on past experience, the Navy’s estimates for future DDG 51s will 

likely increase further as it gains greater certainty over the composition of 

Flight III and beyond. At the beginning of a program, uncertainty about 

cost estimates is high. Our work has shown that over time, cost estimates 

become more certain as the program progresses—and generally increase 

as costs are better understood and program risks are realized.35

 

35 GAO: GAO Cost Estimating and Assessment Guide, 

Recent 

Navy shipbuilding programs, such as the Littoral Combat Ship program, 

initially estimated each ship to cost less than $220 million. This estimate 

has more than doubled as major elements of the ships’ design and 

construction became better understood. In the case of Flight III, the Navy 

now estimates 3 to 4 additional crew members will be required per Flight 

III ship to support the IAMD mission and AMDR than it estimated in the 

GAO-09-3SP (Washington D.C.: 

March 2009).
 

Page 48 GAO-12-113 Arleigh Burke Destroyers 

earlier Radar/Hull Study. Increases in the cost of Flight III would add 

further pressure to the Navy’s long-range shipbuilding plan. Beginning in 

2019, the Navy will face significant constraints on its shipbuilding account 

as it starts procuring new ballistic missile submarines to replace the 

current Ohio class. The Navy currently estimates that this program will 

cost approximately $80.6 billion in procurement alone, with production 

spanning over a decade. 

Despite uncertainty in the costs of the DDG 123, the Flight III lead ship, 

the Navy currently plans to buy the ship as part of a multiyear 

procurement, including 8 DDG Flight IIA ships, and award the contract in 

fiscal year 2013. Multiyear contracting is a special contracting method to 

acquire known requirements for up to 5 years if, among other things, a 

product’s design is stable and technical risk is not excessive. According to 

the Navy, from fiscal year 1998 through 2005, the Navy procured Flight 

IIA ships using multiyear contracts yielding significant savings estimated 

at over $1 billion. However, the Navy first demonstrated production 

confidence through building 10 Flight IIAs before using a multiyear 

procurement approach. While Flight III is not a new clean sheet design, 

the technical risks associated with AMDR and the challenging ship 

redesign as well as a new power and cooling architecture coupled with 

the challenges to construct such a dense ship, will make technical risk 

high. Further, technical studies about Flight III and the equipment it will 

carry are still underway, and key decisions about the ship have not yet 

been made. DDG 123 is not due to start construction until fiscal year 

2016. If the Navy proceeds with this plan it would ultimately be awarding 

a multiyear contract including this ship next fiscal year, even though 

design work has not yet started and without sufficient knowledge about 

cost or any construction history on which to base its costs, while waiting 

until this work is done could result in a more realistic understanding of 

costs. Our prior work has shown that construction of lead ships is 

challenging, the risk of cost growth is high, and having sufficient 

construction knowledge is important before awarding shipbuilding 

contracts. 36

 

36 GAO, Defense Acquisitions: Improved Management Practices Could Help Minimize 

Cost Growth in Navy Shipbuilding Programs, 

 

GAO-05-183 (Washington, D.C.: Feb. 28, 

2005). 

The Navy Plans to Procure 

Lead Ship in Multiyear 

Procurement Despite Inherent 

Risks 
 

Page 49 GAO-12-113 Arleigh Burke Destroyers 

Given the potential technology, design, and construction risks, and level 

of the investment, the current level of program oversight for DDG 51 

Flight III may not be sufficient. The DDG 51 program has a long history 

and has already passed through all of the DOD acquisition milestone 

reviews (formerly Milestones 0 through IV, now Milestones A through C), 

and is now an Acquisition Category (ACAT) 1C program.37

Although it is a potentially $64 billion investment spanning decades, DDG 

51 program office officials do not believe that the Flight III changes are 

significant enough to warrant a return to ACAT 1D oversight. According to 

officials, since the AMDR program—which they believe is the risky 

element of Flight III—is already an ACAT 1D on its own and is also 

progressing through the milestone process, the ship does not warrant 

ACAT 1D designation. Similarly, program officials have stated that they 

believe AMDR has sufficient oversight for Flight III and that it is 

unnecessary for the ship to repeat any milestones. However, significant 

re-design and changes to the hull and mechanical and electrical systems 

will be required for Flight III, which could bring potentially significant risks 

not being captured by AMDR oversight alone. For example, the addition 

A program’s 

acquisition category is based on its location in the acquisition process, 

dollar value, and Milestone Decision Authority special interest, and the 

acquisition category determines the program’s decision authority. For an 

ACAT 1C program, the Assistant Secretary of the Navy (Research, 

Development, and Acquisition) is ultimately the Milestone Decision 

Authority. As the Milestone Decision Authority, the Assistant Secretary is 

designated as having the authority to approve entry of an acquisition 

program into the next phase of the acquisition process, and is 

accountable for cost, schedule, and performance reporting to higher 

authority, including congressional reporting. This differs from the higherlevel ACAT 1D designation, where the Undersecretary of Defense for 

Acquisition, Technology and Logistics is the Milestone Decision Authority. 

The ACAT 1D designation provides a higher level of oversight to the 

program, and also provides enterprisewide visibility over acquisition 

program decisions. 

 

37 According to DOD Instruction 5000.02, a program is designated as ACAT I if it is either 

a Major Defense Acquisition Program—defined as a program estimated by the 

Undersecretary of Defense for Acquisition, Technology and Logistics to require an 

eventual total expenditure for research, development, and test and evaluation of more 

than $365 million in fiscal year 2000 constant dollars or, for procurement, of more than 

$2.190 billion in fiscal year 2000 constant dollars—or if it is designated by the Milestone 

Decision Authority as a special interest program. 

Current Level of Program 

Oversight May Not Be 

Sufficient Given Potential Risks 
 

Page 50 GAO-12-113 Arleigh Burke Destroyers 

of AMDR requires a challenging ship redesign and software modifications 

to Aegis to integrate the new radar. Further, the program has historically 

switched from ACAT 1C to ACAT 1D during the transition from Flight I to 

Flight II which introduced new capabilities. Our analysis shows that Flight 

III meets DOD criteria for ACAT ID (see table 12 below).

Table 12: Flight III Program Compared with Factors to Determine ACAT ID Status

DOD Instruction 5000.02 Flight III Program

Technological complexity Addition of AMDR and significant design 

changes to ship.

Large commitment of resources At least $2.6 billion for lead ship, approximately 

$58-$64 billion for the entire Flight III class.

Critical to achievement of a 

capability/capabilities

Brings IAMD capability to the fleet.

Joint program Shared development effort with the Missile 

Defense Agency.

Source: GAO analysis of DOD and Navy documentation. 

Note: Other factors include congressional interest. 

Officials from the Office of the Secretary of Defense have indicated 

support for designating the Flight III program an ACAT 1D program, 

though a final decision is not expected until 2012 at the earliest. It has 

also not been decided if the program will be required to return to a prior 

milestone, a decision also not expected until 2012 at the earliest. 

Typically, a milestone review gives decision makers an opportunity to 

evaluate important program documentation to help demonstrate that the 

program has the appropriate knowledge to proceed with development or 

production. In preparation for a milestone, programs submit documents 

for well over 10 information requirements, including an independent cost 

estimate, and technology readiness and affordability assessments. 

Though the Navy is working on a draft capabilities document for Flight III, 

without a milestone decision there may be no requirement to compel the 

Navy to develop this document. Further, without a milestone there will be 

no requirement for the Navy to seek an independent cost estimate from 

the office of Cost Assessment and Program Evaluation, typically 

submitted at a milestone review. According to Navy officials, they may 

consider developing a life-cycle cost estimate prior to requesting approval 

for the multiyear procurement approach. The DDG 51 program last 

conducted an independent cost estimate in 1993.
 

Page 51 GAO-12-113 Arleigh Burke Destroyers 

The Navy is in the early stages of a potential $80 billion investment in up 

to 43 DDG 51 destroyers to provide IAMD capability for potentially up to 

the next 60 years. Such investment decisions cannot be made without 

some degree of uncertainty; they will always involve risks—especially in 

the early stages of a program. Yet, a decision of this magnitude should 

proceed with a solid base of analysis—regarding the alternatives, cost, 

and technical risks—as well as a plan for oversight that provides sufficient 

leverage and flexibility to adapt to information as it emerges. These 

pieces are not sufficiently in place, at least with respect to Flight III and 

AMDR. To its credit, the Navy’s goal was to move towards a lower-cost 

solution that could be rapidly fielded; however, there are a number of key 

shortfalls in the Navy’s analysis in support of its decisions. As it stands, 

the Navy risks getting a solution that is not low cost, will not be fielded in 

the near-term, or meet its long-term goals. DDG 51 may ultimately be the 

right decision, but at this point, the Navy’s analysis has not shown this to 

be the case. Specific issues include: 

• The Navy’s choices for Flight III will likely be unsuitable for the most 

stressful threat environments it expects to face. 

• While the Navy potentially pursued a lower-cost ship solution, it did 

not assess the effect of this decision in terms of long-term fleet needs 

where more of these ships may be required to provide the same 

capability of a smaller number of more costly, but more capable, 

ships. 

• Though the Navy hopes to leverage sensor netting to augment the 

capability of these ships, there is a shortage of analysis and testing 

with operational assets to demonstrate that this is a viable option. 

• The Navy clearly states in recent AMDR documents that a new, as-ofyet undefined ship is required to meet its desired IAMD capability. 

However, it has not yet articulated its long-term plans for a new 

surface combatant that is sized to be able to carry a larger AMDR, 

and such a ship is not currently in the Navy’s long-range shipbuilding 

plan. 

• Without a robust operational test program that will demonstrate both 

DDG 51 with the modified Aegis combat system and the new AMDR, 

the Navy cannot be sure that the ships can perform the IAMD mission 

as well as planned. 

In addition to these issues about the analysis underpinning the DDG 51 

program, oversight of the program moving forward could be limited by two 

factors: 

Conclusions
 

Page 52 GAO-12-113 Arleigh Burke Destroyers 

• If the milestone decision authority remains at its current level, needed 

scrutiny may not occur. While the proper milestone entry may be 

discretionary, it is clear that the cost and risk of Flight III and AMDR 

warrant additional oversight. 

• If the Navy pursues a multiyear shipbuilding contract that includes the 

lead ship of Flight III, visibility over the risks inherent in lead ship 

construction could be obscured.

We recommend that the Secretary of Defense direct the Secretary of the 

Navy to take the following three actions:

1. Conduct a thorough AOA in accordance with DOD acquisition 

guidance for its future surface combatant program to include: (a) a 

range of representative threat environments developed in concert with 

the intelligence community; (b) results of its ongoing Flight III studies 

and full cost estimates in advance of awarding DDG 51 Flight III 

production contracts; (c) implications of the ability of the preferred ship 

to accommodate new technologies on future capabilities to determine 

the most suitable ship to carry AMDR and meet near-term IAMD 

requirements and provide a path to far-term capabilities; (d) 

implications on future fleet composition; and (e) an assessment of 

sensor netting—conducted in consultation with MDA and other 

cognizant DOD components—to determine the risks inherent in the 

sensor netting concept, potential current or planned programs that 

could be leveraged, and how sensor netting could realistically be 

integrated with the selected future surface combatant to assist in 

conducting BMD. This AOA should be briefed to the Joint 

Requirements Oversight Council.

2. Report to Congress in its annual long-range shipbuilding plan on its 

plans for a future, larger surface combatant, carrying a more capable 

version of AMDR and the costs and quantities of this ship. 

3. In consultation with MDA and DOD and Navy weapons testers, define 

an operational testing approach for the Aegis ACB-12 upgrades that 

includes sufficient simultaneous live-fire testing needed to fully 

validate IAMD capabilities.

We also recommend that the Secretary of Defense take the following two 

actions:

1. Upgrade the oversight of the Navy’s future surface combatant 

program to ACAT 1D status, and ensure that the appropriate 

milestone entry point is selected to provide cost baselines and 

assessments of design and technical risks and maturity. 

Recommendations for 

Executive Action
 

Page 53 GAO-12-113 Arleigh Burke Destroyers 

2. Ensure that the planned DDG 51 multiyear procurement request does 

not include a Flight III ship. 

We provided a draft of this report to DOD for review and comment. DOD 

provided a written response which is reprinted in appendix II. DOD also 

submitted technical comments that were incorporated into the report as 

appropriate. 

DOD concurred with our second recommendation that the Navy report to 

Congress in its annual long-range shipbuilding plan on its plans for a 

future larger surface combatant carrying a more capable version of 

AMDR. Given the assessments that the Navy is currently conducting on 

surface combatants, the Navy’s next submission should include more 

specific information about its planned future surface combatant 

acquisitions. DOD also agreed with our third recommendation on live-fire 

testing of Aegis ACB-12 upgrades, stating that the Navy and the MDA—

working under Office of the Secretary of Defense oversight—are 

committed to conducting adequate operational testing of ACB-12, but did 

not offer concrete steps they would take to address our concerns. Moving 

forward, DOD should demonstrate its commitment to fully validating IAMD 

capabilities by including robust simultaneous operational live-fire testing 

of multiple cruise and ballistic missile targets in its Aegis Test and 

Evaluation Master Plan that is signed by Director, Operational Test and 

Evaluation. 

DOD did not agree with our first recommendation to conduct an AOA to 

support its future surface combatant selection decision, stating that its 

previous analyses—specifically the MAMDJF AOA and the Radar/Hull 

Study—comprise a body of work that satisfies the objectives of an AOA. 

However, DOD did not present any additional evidence to refute our 

findings. DOD did agree that an assessment of sensor netting needs to 

be performed. Our analysis shows that the Radar/Hull Study, which was 

the key determinant in the DDG 51 decision, was a departure from the 

MAMDJF AOA. These studies are neither complementary nor can they be 

aggregated. While both sought to determine the best solution to address 

identified integrated air and missile defense gaps, the Radar/Hull Study 

essentially answered a different question than the MAMDJF AOA. In 

essence, it was attempting to identify a cost-constrained, less robust 

solution, which makes analysis from one study not always appropriate to 

apply to the other. Specifically, the MAMDJF AOA considered a 

significantly more taxing threat environment than the Radar/Hull Study, 

requiring ships carrying very large radars to independently manage these 

threats. Alternatively, the Radar/Hull Study considered a much less taxing 

Agency Comments 

and Our Evaluation
 

Page 54 GAO-12-113 Arleigh Burke Destroyers 

threat environment, allowing for ships carrying smaller radars but that 

would need to work together to be effective. Ultimately, the MAMDJF 

AOA eliminated DDG 51 from consideration as a single-ship solution. 

DOD also states that it is currently conducting additional studies on Flight 

III, but since these are solely focused on DDG 51, they do not provide any 

additional insight into the decision as to the appropriate ship that might be 

used to supplement the Navy’s existing analysis. As we note in this 

report, the proposed program calls for an investment of up to 

approximately $80 billion for 43 destroyers, and likely more if the Navy 

chooses to pursue a Flight IV concept. Given the scope of the Navy’s 

plans, a thorough AOA is essential to affirm that the decision made is the 

right one and a sound investment moving forward. This AOA should be 

briefed to Joint Requirements Oversight Council because of the 

magnitude of this potential acquisition and because of the joint service 

interest in IAMD that make it important to have an overarching body 

review the Navy’s analysis and decisions. We believe that this 

recommendation remains valid.

DOD disagreed with our fourth recommendation to upgrade the 

acquisition category designation of the Navy’s future surface combatant 

program to ACAT ID at this time, stating that a determination on the 

ACAT designation of DDG 51 Flight III will be made by the fourth quarter 

of fiscal year 2012, once sufficient information is available. If the results of 

the Navy’s analysis continue to support a DDG 51 Flight III as the 

appropriate solution, our analysis shows that Flight III already meets 

criteria for ACAT ID status, and that this status provides an enhanced 

level of oversight appropriate for a program of this magnitude. This 

strategy is also in line with the past flight upgrades that were also 

conducted under ACAT ID status. We therefore believe this 

recommendation remains valid.

Regarding our fifth recommendation that DOD not include a Flight III ship 

in its planned DDG 51 multiyear procurement request, DOD partially 

concurred, stating that it is following the statutory requirements for

multiyear procurement authority. DOD commented that it will select an 

acquisition approach that provides flexibility and minimizes the cost and 

technical risk across all DDG 51 class ships. DOD expects to make a 

determination on including or excluding Flight III ships within the 

certification of the planned multiyear procurement that is due to Congress 

by March 1, 2012. While the Secretary can certify that due to exceptional 

circumstances, proceeding with a multiyear contract is in the "best 

interest" of DOD, notwithstanding the fact that one or more of the 

conditions of the required statutory certification are not met, requesting a 
 

Page 55 GAO-12-113 Arleigh Burke Destroyers 

multiyear procurement in March 2012 that includes the lead Flight III ship 

carries significant risk. DOD will be committing to a cost with no actual 

construction performance data on which to base its estimates and a ship 

concept and design that are not finalized. While DOD argued that it has in 

the past included DDG 51’s that were receiving major upgrades in 

multiyear procurements, as this report shows, planned changes for Flight 

III could far exceed those completed in past DDG 51 upgrades. We 

therefore believe that, in view of the current uncertainty and risk, our 

recommendation remains valid to exclude a Flight III ship from the

upcoming multiyear procurement request. 

In view of the Navy’s disagreement with a number of our 

recommendations, we are elevating these issues to the attention of 

Congress. In the coming years, the Navy will ask Congress to approve 

funding requests for DDG 51 Flight III ships and beyond. Without a solid 

basis of analysis, we believe Congress will not have assurance that the 

Navy is pursuing an appropriate strategy with regard to its future surface 

combatants, including the appropriate level of oversight given its 

significant cost. To help ensure that the department makes a sound 

investment moving forward, Congress should consider directing the 

Secretary of Defense to: 

1. require the Navy to submit a thorough, well-documented AOA for 

the its future surface combatant program that follows both DOD 

acquisition guidance and the elements outlined in our first 

recommendation prior to issuing solicitations for any detail design 

and construction contracts of DDG 51 Flight III ships; 

2. elevate the ACAT status of the DDG 51 Flight III to an ACAT ID 

level if the decision is made to continue pursuing the program; and 

3. include the lead DDG 51 Flight III ship in a multi-year procurement 

request only when the Navy has adequate knowledge about ship 

design, cost, and risk.

We are sending copies of this report to the Secretary of Defense. We are 

also sending copies to the appropriate congressional committees. In 

addition, the report is available at no charge on GAO’s website at 

http://www.gao.gov.

Matters for 

Congressional 

Consideration
 

Page 56 GAO-12-113 Arleigh Burke Destroyers 

If you or your staff has any questions about this report, please contact 

Belva Martin at (202) 512-4841 or martinb@gao.gov. Contact points for 

our Offices of Congressional Relations and Public Affairs may be found 

on the last page of this report. GAO staff who made major contributions to 

this report are listed in appendix III.

Sincerely yours, 

Belva M. Martin

Director, Acquisition and Sourcing Management
Appendix I: Objectives, Scope, and 

Methodology

Page 57 GAO-12-113 Arleigh Burke Destroyers 

The overall objectives of this review were to assess (1) the Navy’s 

determination of the most appropriate platform to meet current and future 

surface combatant requirements; (2) the differences in cost, schedule, 

and design of the restart DDG 51 destroyers compared with previous 

ships, and the risks associated with the restart; and (3) the feasibility of 

the Navy’s plans for maturing and integrating new technologies into the 

future DDG 51 ships. 

To assess how the Navy determined the most appropriate platform to 

meet current and future surface combatant requirements, we analyzed 

the Navy’s Radar/Hull Study, which was the main tool the Navy used for 

assessing the radar and ship options and reviewed the accompanying 

“red team” assessment. We compared this study with other Navy studies 

related to ballistic missile defense (BMD) and integrated air and missile 

defense (IAMD), including the Navy’s Maritime Air and Missile Defense of 

Joint Forces (MAMDJF) analysis of alternatives, the Navy BMD “Knee in 

the Curve Study,” a Navy Cruiser and Destroyer analysis study, and 

Office of Naval Intelligence threat assessment studies. We also reviewed

the Operational Requirements Document for the DDG 1000 and the draft 

Capability Definition Document for the Air and Missile Defense Radar 

(AMDR). We also obtained and reviewed internal Navy briefing slides 

used to present the findings of the Radar/Hull Study to Navy decision 

makers. To assess the steps taken by the Navy in making this decision, 

we reviewed relevant Department of Defense (DOD) policy and guidance 

documents addressing, among other things, acquisition program initiation 

including DOD Instruction 5000.02 and the Weapon Systems Acquisition 

Reform Act of 2009. We compared the Radar/Hull Study with DOD 

analysis of alternatives guidance found in the Defense Acquisition 

Guidebook, DOD Instruction 5000.02, and a July 2008 Air Force Analysis 

of Alternatives handbook. We also analyzed key contractor data 

submissions related to the ship variants and the radar concepts that were 

provided to the Navy to support its decision. We met with officials from 

the Radar/Hull Study team, the Applied Physics Laboratory at Johns 

Hopkins University who were technical consultants on the study, the DDG 

51 and DDG 1000 program offices, representatives from the Office of the 

Chief of Naval Operations Surface Warfare Division, officials from the 

Program Executive Office for Ships (PEO Ships), the Program Executive 

Office for Integrated Warfare Systems (PEO IWS) program offices 

responsible for the Aegis combat system and for AMDR, and contractor 

officials from Raytheon, Lockheed Martin, and Northrop Grumman. We 

met with officials from the Office of Naval Intelligence to discuss the threat 

environment, and we met with officials from the Joint Integrated Air and 

Missile Defense Organization to discuss the recent Joint Capabilities Mix 

Appendix I: Objectives, Scope, and 

Methodology 
Appendix I: Objectives, Scope, and 

Methodology

Page 58 GAO-12-113 Arleigh Burke Destroyers 

study which established required numbers of Navy BMD capable ships. 

We also met with an official from the Joint Staff to discuss the role of the 

Joint Requirements Oversight Council in the DDG 1000 truncation and 

DDG 51 restart decisions. 

To assess the differences in cost between the restart DDG 51 ships and 

previous DDG 51 ships, we examined the Navy budget for DDG 51 

restart ships and compared it with the budget for prior ships. We also 

spoke with the DDG 51 program office and Navy cost estimating officials, 

and discussed their methodology for estimating the impact of the 

production gap on prices, and spoke to officials from Bath Iron Works in 

Bath, Maine and Ingalls Shipbuilding in Pascagoula, Mississippi—the 

shipyards responsible for building DDG 51 destroyers—and the officials 

from the Navy’s Supervisor of Shipbuilding at both sites about the impact 

of the gap on cost estimates. We also spoke to shipyard officials at both 

sites about their readiness to begin construction. We analyzed the Navy’s 

revised acquisition strategy for hulls DDG 114 through DDG 116. To 

assess differences in production schedules we compared the Navy’s 

projected schedules for the Flight IIA restarts with the actual schedule 

performance on previous Flight IIA ships. We also spoke with Navy and 

shipyard officials at both shipyards. To assess the design changes for the 

restart ships, we compared the estimated number of design drawing 

changes and engineering change proposals for Flight IIA restart ships 

with those for previous Flight IIA ships. We examined Navy and 

contractor-provided analyses pertaining to the Aegis upgrade (ACB 12) 

with specific focus on the source lines of code (SLOC), and compared 

SLOC estimates with SLOC actual numbers. We also reviewed software 

defect rates and development schedules related to the ACB 12 upgrade, 

and we analyzed the ACB-12 development and test schedules, risk 

matrices, and results from relevant test events that might impact ACB 12 

availability for installation on DDG 113. We analyzed Defense Contract 

Management Agency (DCMA) reports on ACB 12 development, and 

spoke to relevant DCMA officials. We also reviewed Navy, Missile 

Defense Agency (MDA), and Director, Operational Test and Evaluation 

(DOT&E) proposed operational test schedules and plans to assess 

integration efforts to verify IAMD capability, and interviewed relevant 

Lockheed Martin, MDA, DOT&E, and DOD Development Test and 

Evaluation officials.

To address the feasibility of the Navy’s plans for maturing new 

technologies intended for DDG 51 Flight III ships, we analyzed key Navy 

documentation including the DDG 51 Flight Upgrade Study (Phase I) and 

the accompanying “red team” assessment, contractor AMDR concept 
Appendix I: Objectives, Scope, and 

Methodology

Page 59 GAO-12-113 Arleigh Burke Destroyers 

development documents, and AMDR Top Level Radar Performance 

documents. We compared the development of AMDR and its 

development schedule with previous Navy radar development programs 

(e.g. Cobra Judy Replacement radar, Dual Band Radar) to determine the 

feasibility of the technology and the development schedule. We also 

discussed development, testing, and in-yard date schedules with the 

Navy. We met with each of the three AMDR contractors: Raytheon, 

Lockheed Martin, and Northrop Grumman. To determine the feasibility of 

integrating AMDR and other technologies into Flight III, we compared the 

Navy’s Flight III concepts with Navy service life allowance guidelines, and 

spoke with officials from both shipyards and a former Navy ship designer. 

To assess the feasibility of the Navy’s acquisition strategy for Flight III we 

analyzed relevant DOD acquisition guidance including DOD Instruction 

5000.02, and spoke with officials from the Office of the Secretary of 

Defense for Acquisition, Technology, and Logistics. We also used GAO’s 

Cost Estimating and Assessment Guide. We are providing you with a 

classified annex containing supplemental information.

We conducted this performance audit from January 2011 through January 

2012 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives, and that the data we 

obtained and analyzed are sufficiently reliable for the purposes of our 

assessment.
Appendix II: Comments from the Department 

Of Defense

Page 60 GAO-12-113 Arleigh Burke Destroyers 

Appendix II: Comments from the Department 

Of Defense
Appendix II: Comments from the Department 

Of Defense

Page 61 GAO-12-113 Arleigh Burke Destroyers 
Appendix II: Comments from the Department 

Of Defense

Page 62 GAO-12-113 Arleigh Burke Destroyers 
Appendix II: Comments from the Department 

Of Defense

Page 63 GAO-12-113 Arleigh Burke Destroyers 
Appendix III: GAO Contacts and Staff 

Acknowledgments

Page 64 GAO-12-113 Arleigh Burke Destroyers 

Belva Martin, 202-512-4841 or martinb@gao.gov.

In addition to the contact above, Diana Moldafsky, Assistant Director; 

Jennifer Echard; Laura Greifner; Kristine Hassinger; Jeremy Hawk; Ioan 

Ifrim; C. James Madar; G. Michael Mikota; Karen Richey; W. Kendall 

Roberts; Roxanna Sun; and Alyssa Weir made key contributions to this 

report.

Appendix III: GAO Contacts and Staff 

Acknowledgments 

GAO Contact

Acknowledgments

(120948)
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