This has left the Nation with a shortfall of 32 ships. The Navy's fiscal year 2001 budget request and five-year plan calls for the construction of only eight ships in each of the next four years and seven ships in 2005. As a result, the Nation's naval fleet will continue to shrink and fall below 300 ships. Mr. Chairman, as you have stated on many occasions, Navy shipbuilding budgets will have to be increased if the Nation is to rebuild and maintain a bare bones minimum fleet of 300 ships. Should Congress and the Administration decide to increase naval shipbuilding, industry urges that increased budgets be combined with the best commercial business practices in the acquisition and financing of ships to maximize stability and cost savings.
Ships are very different from any other defense system.
They take three to seven years to build, and they are bought in very few quantities. The uniqueness of naval ships dictates the need for different acquisition approaches if stable production rates and greater cost savings are to be achieved. This type of contracting method allows the shipbuilder to buy materials and systems for multiple ships of the class. The savings in a quantity material and system buy is substantial versus a one-off buy under current shipbuilding practices. Only one of these types of ship is bought once every three to five years.