Buying Warships from America. Why the Sums Don't Add Up.

An article by highly respected Naval author Mike Critchley over at the Portsmouth News (inspired me to write this piece (link is HERE) It talks on part about how the UK should look to the US to buy more ‘off the shelf’ equipment to try and bring more into service at a lower overall cost.

On paper buying American is often cited alongside ‘just do Commercial Off the Shelf’ (COTS) as a great way of saving the MOD money and enabling the UK to get more bang for its buck. I must be honest though and say that I fundamentally disagree that always buying American is the right solution.

The usual premise is that there is a way that UK could go to the US and get vastly cheaper equipment compared to the so-called gold plated requirements of the MOD. The often cited case is either the Blackhawk, which supposedly was offered to the UK for a very cheap sum some years ago to fill the support helicopter requirement on HERRICK, or the Arleigh Burke destroyer, which has been block built now for 30 years and unit costs are reduced greatly. It’s a great idea isn’t it – buy cheap and then just throw the cheap kit into service.

The problems with this argument start with the fact that the so-called ‘cheap blackhawk’ was nothing of the sort. US equipment prices for US kit often doesn’t include fairly important things like the engine, as they’re counted as ‘Government Furnished Equipment’ and procured separately then mated into the design. Then you need to add in all the so-called ‘bells and whistles’ like communications equipment, kit that is operable with UK requirements and so on, and integrate all the software on the airframe or ship. Software and equipment integration is seriously challenging and the reason costs rise – its all very well saying ‘stick the following pieces of kit on a design’ but if they can’t talk to each other, can’t fight as part of an integrated combat management system or worse actively degrade the performance of other capabilities, then its going to be messy and expensive to fix.

This is of course not taking into account the complete lack of a US spares chain in the UK, which would need to be brought in from scratch, the lack of suitably qualified personnel to operate and maintain the airframe or ship, and the lack of support and maintenance facilities to run them from. All of this can be brought into service, but it comes at a cost, and arguably by the time this is factored in, the cost is equal to or often greater than buying British.

Its often forgotten that in the 1990s the RN looked seriously at purchasing some Ticonderoga class cruisers to cover the air defence gap during the T42/NATO Frigate/CNGF/T45 replacement problems. Reportedly one of the reasons for rejection was the sheer cost involved of integrating several very different and non standard vessels into the RN, with the considerable headache of how to solve the manpower and supply chain issues just to operate them all, let alone software and communications integration.

USS ARLEIGH BURKE (DDG 51)

Lets assume though that the RN puts forward a case to bolster its force through the purchase of four Arleigh Burke class destroyers. They’re yesterdays technology of course, as the US has struggled to get any credible new build designs into serial production for decades now, but they’re still a capable and potent vessel.

To even buy American means negotiating the challenging hurdle of getting past the ‘Foreign Military Sales’ (FMS) case and getting Congressional approval to do so. In simple terms, to buy, support and operate a new build ship from the US means placing your independence and sovereignty in the hands of the US Government in perpetuity. If their largesse is lost, and they refuse to approve sales, then the UK ability to operate a vessel is arguably lost.

Similarly, FMS places in American hands the ability to decree the purchase rate for spare parts and equipment. It is bought at the pace dictated by the US, perhaps to support operational needs, but often arguably in the name of supporting the US defence industry and congressional districts. To keep operating the equipment means buying what you are told, when you are told, and directly subsidising the US and not UK industry in the process.

Of course you could try and buy a non-standard DDG51 and kit it out to UK standards- to do this would mean taking the design, ripping out all the US bits you don’t want and then putting UK bits in. However this may not be approved by the FMS case, and more importantly adds an enormous bill to the cost as you take a design intended to work one way and try to make it work very differently again.

Then you have to look at the wider industrial implications – its not just the big suppliers who matter, but the small-medium enterprises that really need consistent support to survive. If you suddenly announce that the bulk of your naval construction work for years to come is being divested to the US, these companies financial ability to survive, to create new technology and to be present to bid when the UK build orders come again is doubtful. The margins are extremely tight in the defence sector, and its possible that a move to buying American could cause a lot of them to go under. You may buy American to save money, but in turn, you may be forced into a long term relationship as your specialist suppliers no longer exist in the domestic industrial market.

You have then to consider the national sovereignty argument – one reason the UK relies on UK built capability is because it gives freedom of action and manoeuvre to upgrade the hulls, to place whatever systems you like on them and to grow the platform to meet your own national requirements. Many US FMS sales don’t work like this – the customer is provided with a sealed box, or US staff to operate it. To even open the seals is to risk the entire relationship falling apart, and if you’ve not got an industry to turn to then that can be difficult. Essentially you as a nation have no say over the electronic components that the US provides, how they are serviced and you have no ability to influence them or know how to upgrade or modify them. To buy American can be to risk a high level of national independence in the trade off to acquire short term capability.

The real problem is that while its easy to assume the country you buy from will always be your ally, times change. Russia is experiencing problems after the change in the global situation saw the collapse of its purchase of Mistral class LPDs, which are now going to Egypt. Instead Russia is scrambling around trying to invent a new design which may (or based on their track record) may not enter service some years from now. Russia is also reliant on the Ukraine for many engine parts for their navy – the ongoing tensions there means that the supply of parts no longer happens, and in time the Russian navy is going to struggle to keep itself at sea. Purchasing overseas can save money, and give early access to capability that is otherwise unobtainable, but it does come at a price.

Finally, even if the destroyers entered UK service, you’d need to carefully consider how to integrate such a vastly different design into the UK concept. Assuming the brief is to save money, by bringing 4 US standard DDG51s over, they would have totally different crew concepts of employment communications, propulsion, NBCD, combat systems, weapons, munitions, helicopters, accommodation, life support and other issues to name but a few. The RN has historically struggled to work out what to do with ‘Orphan classes’ (e.g. HMS MERMAID) as they often rely more support than is possible or effective to do (hence the move to just two ship classes at present – namely to save money).

Don’t forget of course that you are reliant on the vagaries of the US supply chain, and that if a war occurred, the chances are that you’d go to the bottom of the priority pile, with US assets taking priority. Is the UK comfortable that it may not get the spare parts it needs to keep a ship at sea and that it will always play second string to the US Navy in this respect? What happens if the UK went to war on a national issue (e.g. Falklands) and found the US Government wasn’t willing to provide the spare parts needed?

If on the other hand you then wanted to kit the vessels out to a UK standard, the question is where to start? Who is paying for the integration work for the vessels, is modification covered by the sales agreement? What are the ITAR (technology transfer regulation) implications of such a move and how would it happen? To take just one simple example, putting a UK secure IT network for UK EYES ONLY material onto the ship would mean changing the entire IT capability, bolting on new kit that the ship wasn’t designed or intended to carry and coming at considerable cost. That’s just to send an email from the ship, let alone fight it.

There is the wider issue too as to whether the US values client states in the same way as it values genuine partners. The reason the UK brings value to the US is its ability to provide operationally independent capability capable of war fighting at the very highest level without recourse to others for help. This is merged with world class industry and an ability to produce genuinely innovative solutions to capability problems – often taken up or mirrored by the US and other allies.

To move to a more client state relationship in order to put more ships at sea more cheaply would fundamentally mean changing the nature of the UK relationship with the US, threatening the independence and the ability to add value in the same way. Arguably an RN operating DDG51s is not in the best interest of the USN for a variety of reasons.

There will always be some element of exporting equipment in from other countries, and the UK does use a lot of US derived equipment in some areas.  But it pays to prevent yourself from being too beholden on one nation for support – not only does it not save money, but it significantly constrains your freedom of action and ability to operate without the active approval and support of a foreign nation. Some smaller powers are prepared to make this trade off, knowing that their own industrial base is more limited, or that the realistic prospect of their taking unilateral action is so slight as to not be worth it.

Its fair to say buying national capability seems expensive, but when costed up is arguably no less expensive than buying from the US and adapting the kit to meet UK standards – its just the headline figures that are cheaper. To buy US to save money is an alluring argument, but one that is fundamentally built on dangerous assumptions that could pose a real challenge to the ongoing ability of the Royal Navy to work effectively on operations. It should not be encouraged.