The Congressional Budget Office estimates that the Department of the Navy’s proposed medium landing ship, or LSM, program could cost as much as $21 billion in 2024 dollars, depending on the final design of the ship and the number of units to be ordered, both of which have yet to be finalized, even though construction is planned to begin by fiscal year 2025.
The CBO discusses this estimate and more in a report released Thursday that tackles the acquisition costs of the LSM, a small amphibious vessel that will work to transport and land U.S. Marine Corps littoral regiments.
As a baseline, the CBO says that a program to build 18 LSM units would cost between $340 million and $430 million per ship on average, for a total cost of between $6.2 billion and $7.8 billion. A program to build 35 LSM units would bring the total cost to between $11.9 billion and $15 billion.
For either program, the cost per unit would be the same because the CBO believes that whatever savings that might be accrued under the larger shipbuilding program would be offset by inflation, which would raise the costs over the longer production period.
These initial estimates are based on the assumption that the Navy would go for a design that combines commercial and military standards. A design that adheres strictly to military standards would increase the costs considerably.
Under the more stringent standards, each unit would cost between $475 million and $600 million on average, raising the total cost for an 18-unit program by $2 billion to $3 billion. For a 35-unit program, the total cost would go up by $5 billion to $6 billion.
