U.S. shipbuilding spending is about to drastically increase, with a projected budget of $30.1 billion for the next five years as opposed to the $24.1 billion spent in the past five. To find out exactly how big this increase is and why, take a quick look below.
How much is shipbuilding spending increasing?
From 2018 to 2022, $24.1 billion was spent on average annually on U.S. shipbuilding. In an FY21 request for 2021–2025, the former administration proposed an average annual budget of $23.7 billion, and in a draft FY22 framework for 2022–2026, the former administration proposed an average annual budget of $33.4 billion. The first partial budget released by the current administration proposed a $23.6-billion average annual budget for 2022–2026, which increased to an average annual budget of $30.1 billion in the latest (and first complete) proposal released in the current administration’s FY23 request for 2023–2027.
(This is a significant increase from historical spending, although it still falls short of the previous administration’s FY22 framework for 2022–2026.)
Why is shipbuilding spending increasing?
The biggest drivers of higher shipbuilding in the FY23 budget are the Columbia-class submarine and the DDG 51 destroyer. The Columbia-class submarine build rate is slowly increasing as the program moves forward ($36 billion over the FYDP), and the Navy worries the program will put too much strain on other items in the shipbuilding account. Meanwhile, the DDG 51 destroyer has a build rate of two ships a year, which also places it at $36 billion over the FYDP.
Despite larger shipbuilding budgets, the Navy still says it needs more money to grow the fleet. The Navy’s latest FY23 long-range shipbuilding plan presented three scenarios, and the preferred one would require an additional $75 billion between 2028-2052 (more than $3 billion more per year).
Congress has provided an average increase of $2.6 billion for shipbuilding over the past five years, and lawmakers could still step in to continue bolstering shipbuilding budgets.
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Forecast International’s U.S. Defense Budget Forecast is a streamlined database providing fast and easy access to the Pentagon’s entire acquisition budget. The product features sorting and data visualization options, and presents historical and outyear funding through an online interface with downloadable Excel spreadsheets, allowing users to conduct further analysis or custom data manipulation. A new update to this online interactive product allows users to view 10 years’ worth of Procurement or Research, Development, Test & Evaluation (RDT&E) funding at a time, comprising five years of historical data alongside the Pentagon’s Future Years Defense Program. Historical FYDP datasets are also available, providing final spending data back to 2012. The new feature update also makes it even easier to identify procurement trends by displaying quantity details over time. Click here to LEARN MORE or here to DOWNLOAD A FREE SAMPLE FORECAST