U.S. ICBM to Replace 1970s Minuteman May Cost $111 Billion

The Pentagon’s next generation intercontinental ballistic missile program could cost U.S. taxpayers as much as $110.6 billion, according to internal Defense Department estimates, adding to a wave of big-ticket nuclear weapons programs slated for the years ahead.

Ellen Lord, the Pentagon’s undersecretary for acquisition and sustainment, approved the ICBM program going forward and supported the purchase of 659 missiles -- 25 for initial testing and 634 for silos, spares and later testing, according to a Sept. 21 report obtained by Bloomberg News that was marked “Unclassified/For Official Use Only.”

The new estimate includes a $13 billion contract Northrop Grumman Corp. received in September to start full-scale development and eventual production of missiles intended to replace the aging Minuteman III system, the land-based portion of the U.S. nuclear triad.

U.S. ICBM to Replace 1970s Minuteman May Cost $111 Billion

The Air Force and the Pentagon’s independent cost assessment office project the missile program alone -- not including the nuclear warheads they’ll carry -- will cost between $93.1 billion and $95.8 billion. That is up from a preliminary $85 billion Pentagon forecast in 2016.

On top of that, the ICBM’s W-87-1 warhead program is estimated to cost as much as $14.8 billion, according to the National Nuclear Security Administration, which manages the project, and a new report by the Government Accountability Office.

$1.2 Trillion Program

The ICBM contract provides momentum for U.S. plans to modernize the capacity to deliver nuclear weapons via land-based missile systems, submarines and strategic bombers, a bipartisan effort started during the Obama administration. The entire package is expected to cost as much as $1.2 trillion through 2046 for development, purchase and long-term support, the Congressional Budget Office estimated in 2018.

The CBO said in 2017 that the combined annual costs of nuclear modernization and sustainment of the current force would peak at about 15% of the Pentagon’s total acquisition costs into the early 2030s, or “more than triple the current share.”

As part of the broader renovation of the nuclear triad, the Navy plans to start construction this month on the first Columbia-class nuclear missile submarine, an estimated $128 billion program that will eventually produce 12 subs.

The Pentagon assessed that the risks of production delays and cost overruns in the ICBM program were reduced during a prior “Technology Maturation and Risk Reduction” phase that pitted Northrop Grumman against Boeing Co.

The cost disclosure drew varied reactions.

“The ICBM leg of the triad is the least valuable leg,” so “spending over $100 billion on a new system and warhead is unnecessary and would divert funds from higher priority national security needs,” Kingston Reif, a nuclear weapons analyst for the Arms Control Association, said in an email. “There are cheaper options to maintain a credible ICBM force.”

Not everyone agreed.

“For a program that will be in operation until at least 2075, this cost is not just affordable, it is a vital investment in the security of the U.S. and its allies,” Tim Morrison, a former National Security Council official and nuclear weapons specialist with the Hudson Institute, said in a statement. “It is madness for the United States to disarm -- which is what not recapitalizing the ICBM leg would be -- in the midst of Russian and Chinese arms racing.”

Sole Bidder

The Minuteman III was originally built by Boeing and has been in service since the 1970s. Boeing announced last year that it was dropping out of the competition to develop the new missile, citing what it called a disadvantage in the bidding structure. That left Falls Church, Virginia-based Northrop as the sole bidder.

The new document also discloses:

  • The Air Force projects that although it hopes to have the first missiles in operational silos between April and June 2029, it is formally projecting an initial operational capability two years later.
  • The Pentagon cost office, taking into account possible project risks, also projects an April-June 2031 operational deployment.
  • The cost office breaks down the ICBM costs into subgroups: a research and development phase valued at up to $25.5 billion, a procurement phase of $61.6 billion and military construction phase of up to $8.7 billion. Separate long-term support costs are estimated at $166.6 billion.

©2020 Bloomberg L.P.

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