How Much Does a Blue Water Navy Cost?

The USS Ronald Reagan (CVN 76), USS Theodore Roosevelt (CVN 71) and USS Nimitz (CVN 68) Strike Groups transit the Western Pacific with ships from the Japan Maritime Self-Defense Force. The strike groups are underway and conducting operations in international waters as part of a three-carrier strike force exercise. The U.S. Navy has patrolled the Indo-Asia Pacific region routinely for more than 70 years promoting regional security, stability and prosperity. (U.S. Navy photo)
The USS Ronald Reagan (CVN 76), USS Theodore Roosevelt (CVN 71) and USS Nimitz (CVN 68) Strike Groups transit the Western Pacific with ships from the Japan Maritime Self-Defense Force. The strike groups are underway and conducting operations in international waters as part of a three-carrier strike force exercise. (U.S. Navy photo)

Blue Water Navies: A Nice Toy or Necessity? What is the Navy’s role in the 21st century?

The roles a navy serves depend on its capabilities. Only a handful of countries have a so-called blue-water navy, which can operate across the open ocean. Others, constrained by geography or resources, may only maintain fleets for coastal regions or rivers and estuaries. Building and operating a powerful navy requires a vast of money, which is only a few countries can afford it.

Navies are mainly used for diplomacy and small-scale maritime security operations in the 21st century. Navies can exert influence by their mere presence and normal operations.  Let’s have a brief look at these roles:

Maritime security: Shipping protection operations include counterpiracy, drug interdiction, environmental protection, and other law enforcement.

naval boarding party members aboard hmcs calgary inspect contraband during a boarding operation to counter drug smuggling on 23 april, 2021 in the arabian sea during operation artemis
Naval Boarding Party Members Aboard Hmcs Calgary Inspect Contraband During A Boarding Operation To Counter Drug Smuggling On 23 April, 2021 In The Arabian Sea During Operation Artemis (Photo: Royal Canadian Navy)

Humanitarian aid: It responds to natural and human-made disasters with medical, food, and logistical and security assistance.

Forward presence: Countries deploy their navies to various regions where they have a strategic interest.

Deterrence: Especially with using ballistic-missile submarines show a credible threat to adversaries during a potential nuclear conflict.

the u.s. navy's nuclear ballistic submarine uss maine (ssbn-741) one of the nations newest ohio class submarines conducts surface navigational operations approximately 50 miles due south of naval station roosevelt roads, puerto rico.
The U.s. Navy’S Nuclear Ballistic Submarine Uss Maine (Ssbn-741) One Of The Nations Newest Ohio Class Submarines Conducts Surface Navigational Operations Approximately 50 Miles Due South Of Naval Station Roosevelt Roads, Puerto Rico.

Power projection:  It can threaten or direct strike far away from the homeland against the adversaries for sustained periods.

Diplomacy: Navies are used to influence the behavior of allies and adversaries during times of peace. Tactics the Navy employs for diplomatic effect include; Port calls, Transit (e.g. passing through the Strait of Taiwan), Freedom of navigation operations, etc.

How Much Does a Warship Cost to Build and Operate? 

When estimating the costs and affordability of a new ship within the shipbuilding plan, the total expected costs to be incurred over the lifecycle of that ship must be considered so as to not further understate the budgetary requirements of these ventures. The three cost areas within a lifecycle cost are categorized as:

• Procurement (Including R&D)

• Operating and Support (O&S)

• Disposal

A typical life cycle cost structure for a ship shows that Operating and Support costs make up most of the lifecycle costs overshadowing the other two.

fincantieri marinette marine launches uss marinette freedom class littoral combat for us navy 925 001 - naval post- naval news and information
Photo Courtesy: Fincantieri

Most of the countries do not publicize the details of the Navy budgets or navy deployment costs. On the other hand, a few official reports show that a larger amount is required to operate and sustain naval operation.

One estimate shows that it costs $6.5 million per day to operate a carrier strike group, a figure which includes pay for 6,700 sailors and the cost of acquiring all the ships in the strike group. It includes the costs of military pay, maintenance, resupply and midlife refueling.  Most of these costs will have to be carried whether the vessels are deployed, on training missions or in homeport.

the uss theodore roosevelt carrier strike group transits in formation while deployed in the indo-pacific region in january 2020. (us navy photo)
The Uss Theodore Roosevelt Carrier Strike Group Transits In Formation While Deployed In The Indo-Pacific Region In January 2020. (Us Navy Photo)

To give an idea about the cost of navies to the owner countries, we will use the data of the US Congressional Budget Office’s April 2021 report about the US Navy’s December 2020 Shipbuilding Plan.

Each year, as directed by the US Congress, the US Navy submits a report with the President’s budget describing the planned inventory, purchases, deliveries, and retirements of the ships in its fleet for the next 30 years. The US Navy did not submit its 30-year shipbuilding plan with the fiscal year 2021 budget, but the Department of Defense submitted a plan to the Congress on December 9, 2020, that covers the period 2022 to 2051.

In this report, the Congressional Budget Office analyzes that shipbuilding plan and estimates the costs of implementing it.

Cost. The December 2020 plan would require average annual shipbuilding appropriations almost 50 percent larger than the average over the past five years. CBO estimates that total shipbuilding costs, including costs for nuclear refueling and unmanned systems, would average about $34 billion per year (in 2021 dollars), 10 percent more than the US Navy estimates. Annual operation and support costs for the fleet would grow from $74 billion today to $113 billion by 2051. The U.S. Navy’s total budget would increase from about $200 billion today to $279 billion (in 2021 dollars) by 2051.

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How Much Does A Blue Water Navy Cost? 11

Purchasing Plan. The U.S. Navy plans to purchase 404 new ships between 2022 and 2051—300 combat ships and 104 logistics and support ships. The US Navy also plans to purchase 223 unmanned undersea and surface vehicles to supplement its fleet.

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How Much Does A Blue Water Navy Cost? 12

• Fleet Size. If the US Navy adhered to the schedule for purchases and ship retirements outlined in its December 2020 plan, the inventory of manned ships would rise from about 300 today to about 400 by 2038. The force of unmanned systems would rise from just a few prototypes today to about 140 by 2045.

Although the US Navy’s December 2020 plan would increase the size of the fleet by one-third and add about 140 unmanned systems, fleetwide displacement would be only 28 percent greater than for today’s fleet. The total number of sailors serving on the Navy’s ships would actually decline by 7 percent. When designing new ships, the US  Navy seeks to reduce the size of the crews, so the fleet in 2051 would have fewer ships with large crews than today’s fleet even though it had more ships overall. If the Navy’s plans for designing ships with smaller crews did not succeed, then the number of sailors—and costs—would be higher than estimated here.

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Sailors Man The Rails Aboard The Aircraft Carrier Uss George Washington (Cvn 73) While Underway Off The Coast Of Singapore. (U.s. Navy Photo)

The larger fleet envisioned under the Navy’s December 2020 shipbuilding plan would result in greater operation and support costs: More ships would require more maintenance and would consume more fuel and supplies during both training exercises and deployments.

Using information in the President’s 2021 budget, CBO estimated operation and support costs in three categories: direct costs, indirect costs, and overhead costs. Direct costs include crew salaries, fuel, supplies, and repairs and maintenance that the crews perform for the Navy’s combat ships. Indirect costs include expenditures for various support units and organizations that are necessary for combat units to fight effectively, including combat logistics and support ships. Overhead costs are expenditures for various means of support for combat units, such as recruiting, training, acquisition offices, maintenance, and medical care.

171011 o gr655 978 - naval post- naval news and information
The Arleigh Burke-Class Guided-Missile Destroyer Uss John S. Mccain (Ddg 56) Departs Singapore On The Heavy Lift Transport Mv Treasure, Oct. 11, 2017. Treasure Will Transport John S. Mccain To Fleet Activities Yokosuka For Repairs. (U.s. Navy Photo )

Direct costs for operation and support currently total about $32 billion per year. Those costs would rise in real terms to $49 billion annually by 2051—partly because of the Navy’s larger fleet. As with ship construction, the difference of about 1.2 percent per year between inflation in operation and support costs and inflation in the economy as a whole is included as real growth in costs, calculated in 2021 dollars.

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How Much Does A Blue Water Navy Cost? 13

Operation and support costs would not be much higher under the December 2020 plan than under the FY 2020 plan. Under the prior plan, the fleet would have been smaller, but it also would have included more large ships, which are more expensive to operate.

Click on the picture to read the full report:

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How Much Does A Blue Water Navy Cost? 14

The costs of some Naval Assets. This information is not accurate, intended to give a rough idea about the ships building costs (Source: Wikipedia)

Aircraft Carriers

USS Gerald R Ford-$13.3 billion

HMS Queen Elizabeth (UK)-$3.7 billion

ITS Cavour CVH (Italy) €1.39 billion (2010)

Charles de Gaulle (France)- €3 billion (2001)

INS Vikrant (India)-US$3.5 billion in 2019

Cruisers/Destroyers/Frigates/Corvettes/Patrol Boats

Arleigh Burke-US$1.843 billion per ship (DDG 114–116, FY2011/12)

Type 45 (UK) Over £1.050 billion per ship 

Zumwalt-$6,3 billion

F105 Cristobal Colon (Spain)-€ 823 million

Holland (Netherlands)- €116.95 million (2007)

Iver Huitfeldt (Denmark)-US$325 million per ship

Sachsen Type 124 (Germany)-€700 million per unit

F-22P Zulfiquar (China/Pakistan)-$187.5 million USD per unit

Braunschweig K-130 (Germany)- €240 million (2001) per ship (Batch 1), €400 million (2017) per ship (Batch 2)

MILGEM corvettes (Turkey)-$250 million

Visby (Sweden)-$184 million

Ambassador MK III (Egypt/USA)-US$240m

Submarines

Virginia SSN-$2.8 billion per unit; $3.4 billion per unit w/ VPM

Astute SSN (UK)- £1.65 billion per boat 

Barracuda SSN (France)- €1.32 billion (2014) per unit 

Improved Kilo SSK (Russia)-$350 million

Type 214 SSK (Germany)-$500 million

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