The insidedefense.com article states:
Navy Secretary Donald Winter in March said the service would pick one ship design for the LCS program’s “Flight 1” phase, which is slated to begin in FY-10, instead of continuing to build two different versions of the LCS, as it is doing for the current “Flight 0” phase. Those two in-development versions, which have both faced cost overruns and appear noticeably different, are designed by rival defense contractors General Dynamics and Lockheed Martin.
While the new Navy report on LCS reiterates the single-seaframe-selection plan described by Winter, it also includes commentary on why continuing to buy both seaframes is “an alternative.” The report cites reasons including that both ships are currently being assessed as being capable of meeting all the Key Performance Parameters and critical requirements. Also, buying both seaframes beyond FY-10 would leverage nonrecurring investments the Navy and industry are making now in the so-called “Flight 0” LCSs, the report states.
Readers of this blog shouldn't be surprised to hear that the Navy is having this discussion, if there is one thing the Navy is well known for in the 21st century, it is saying one thing and doing another. Until FY07, the Navy had produced 7 budgets this century, each with an outyear 4 year plan included, and not once until the fiscal year 07 plan did the actually build the ships planned in the previous years plan.
Ultimately, this decision may not be the Navies decision to make. It is important to note that keeping shipbuilding programs, or even multiple shipyards able to produce ships is good governance, not only from a political point of view, but from a redundancy point of view. It can 'sometimes' also contribute to competition, and in a way may be doing exactly that today with the LCS-3 being the scapegoat to insure LCS-2 and LCS-4 hit cost estimates.

The Lockheed Martin international version of the LCS is also getting a lot of attention as of late. Last week I posted on the interest India has in the Lockheed Martin version of the LCS, but also this week there is news Israel is getting ready to make its move as well. I for one am not surprised that both Israel and India would be interested in the same ship class, even if it is the LCS, as both are also in development of the same long range naval anti-air missile, as well as other naval equipment including UAVs. Buying the same ship would allow both countries to share the cost of integration for new weapons systems.
Will other nations also express interest in the LCS? Probably not for a few years, at least not until other customers pay for the design costs. While it is easy to say 3 countries isn't enough to advocate the US will not buy both LCS, particularly since the US Navy version is completely different than the international versions of the LCS, I still believe the Navy will ultimately buy them both. Remember, this has to go through Congress, and Congress operates on a completely different metric than the Navy does, and it has nothing to do with cost efficiency.
Congress has a long history exercising its unique metrics in Naval shipbuilding. As far back as 1794, Congress authorized six frigates, and one would think to do so cost efficiently they would all be built at a single yard. Instead, Congress decided to build each of the six frigates in six different shipyards, in fact starting some of those shipyards in the process. Keep in mind the historical congressional view of shipbuilding as the Navy tries for these 'winner take all strategies' in shipbuilding, because I think we are going to find for the LCS, DD(X), and virtually anything else where more than one class is produced that Congress doesn't have a history of putting all its eggs in one basket, and could very likely choose to buy multiple classes just to keep the shipbuilding industry afloat, as opposed to building ships required by the US Navy for it to meet its mission requirements. This is part of the risk the Navy should assume as it approaches these multi-ship first in class shipbuilding strategies.
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