US Navy explains plan to scrap DDG-1000 destroyer

By Andrea Shalal-Esa

WASHINGTON (Reuters) - A U.S. Navy decision to scrap the DDG-1000 destroyer program after just two ships could have "potentially devastating consequences" said Sen. Susan Collins, a Maine Republican whose state includes General Dynamics Corp's (GD.N) Bath Iron Works shipyard.

U.S. Navy Secretary Donald Winter and Chief of Naval Operations Adm. Gary Roughead spent hours with lawmakers on Wednesday explaining their decision.

Collins said Deputy Defense Secretary Gordon England had promised to work with her to "mitigate the impact on Bath Iron Works' workforce of the termination of the DDG-1000 program."

Bath Iron Works is building one of the new destroyers, Northrop Grumman Corp (NOC.N) is building the other at its Ingalls shipyard in Pascagoula, Mississippi.

Defense analyst Loren Thompson of the Lexington Institute said the net effect on the contractors would be minimal since they would get more work building older model DDG-51 destroyers.

The Navy has spent almost $10 billion to develop the new stealthy warship over the past 15 years, and was due to spend another $19 billion in coming years, according to the Pentagon's latest selection acquisition report to Congress.

Government watchdog agencies and critics in Congress argue the cost of each DDG-1000 destroyer had become so high that the Navy would have trouble reaching its goal of a 313-ship fleet.

Thompson said the Navy was "flailing about trying to define its requirement for warships," but had clearly decided it did not need as many of the new destroyers, which were designed to attack targets on land up to 100 miles away.