Budget Shortfalls May Result In The U.S. Navy Cancelling Its Most Lethal Warship

THE U.S. NAVY'S STEALTHY NEW ZUMWALT-CLASS DESTROYER IS AS BIG AS A BATTLECRUISER, AND TWICE AS LETHAL. IMAGE SOURCE: U.S. NAVY.

Rich Smith, Motley Fool: Will the U.S. Navy Torpedo Its Most Lethal Warship?

And if it does, will this spell doomsday for defense contractors?

The United States Navy has a massive new stealth destroyer. Two of them, in fact -- but now it looks like they might never get a third.

Seeking a stealthy, survivable destroyer to lead it into the 21st century, and one with the range to threaten targets both on land as well as at sea, the U.S. Navy began developing the DDG 1000 destroyer class back in 1994. By 2001, the Navy had settled upon a plan to build 32 such vessels, a plan that was later scaled back to first seven, then just three.

Prime contractor General Dynamics (NYSE:GD) has the first two DDG 1000s already (mostly) completed. The USS Zumwalt (DDG 1000) is due to reach initial operating capability in 2016, and the USS Michael Monsoor (DDG 1001) should be delivered for sea trials that same year. The third ship of what's come to be called the Zumwalt class, USS Lyndon B. Johnson (DDG 1002), is already 41% complete and due for delivery in 2018. But as BloombergBusiness reports, the Pentagon will review plans to finish its construction later this month -- with an eye toward not finishing the ship.

WNU Editor: $3.5 billion for a warship .... I still have problems digesting this number.