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Title page 1

Contents 1

Highlights 2

Background 5

Shipbuilding Practices 5

Navy Shipbuilding Industrial Base 5

Leading Practices in Product Development 6

Navy's Schedule, Cost, and Performance Shortfalls Are Long-Standing 9

Navy Budget and Acquisition Processes Stifle Innovative Technologies 13

Navy Faces Rapid Change from Warfighting Innovations 13

Budget Processes Lack Timeliness and Flexibility Needed to Rapidly Deliver Innovation to the Fleet 14

Acquisition Processes Do Not Enable Pace Needed for New Ship Deliveries 17

Industrial Base Limitations Impede Navy's Ability to Improve Shipbuilding Outcomes 18

Infrastructure and Workforce Limitations Weigh on Shipbuilding Outcomes 19

Navy Shipbuilding Plans and Contracting Strategies Have Not Driven Private Industrial Base Investments 19

Benefits Are Uncertain from DOD's Shipbuilding Industrial Base Investments 21

Navy Efforts to Improve Industrial Base Challenges Are Hindered by Lack of Long-Term Management Strategy 22

A New Approach Is Needed to Meet Modern Challenges 23

GAO Contact and Staff Acknowledgments 28

Figures 5

Figure 1. Notional Ship Design and Construction Process 5

Figure 2. Locations of Major Shipyards That Build Navy Ships 6

Figure 3. Key Principles Used by Commercial Companies to Enable Successful Product Development 7

Figure 4. Iterative Cycles of Design, Validation, and Production Used for Product Development 8

Figure 5. Schedule Delays for Navy Ships Under Construction as of September 2024 12

Figure 6. Key Infrastructure and Workforce Challenges Facing the Shipbuilding Industrial Base 19

Figure 7. Greatest and Least Number of Ships Planned for Procurement in Navy Annual Shipbuilding Plans, Fiscal Years 2019-2025 20

Figure 8. Navy and OSD Investments and Budget Requests for the Shipbuilding Industrial Base, Fiscal Years 2014-2028 21

Figure 9. Comparison of Design and Construction Cycle Times for Selected Commercial Ships and Navy Ships Provided to the Fleet Since 2007 24

Figure 10. GAO Comparison of Leading Ship Design Practices for Commercial Companies and U.S. Navy 25