US Navy’s next-gen destroyer looking like a money pit

The US Navy’s next-gen DDG(X) destroyer is designed to outgun China’s rising fleet, but soaring costs, shaky tech and shipyard bottlenecks threaten to derail the program before it leaves the drawing board.

This month, the US Congressional Research Service (CRS) released a report stating that while the US Navy seeks to procure the first DDG(X) in the early 2030s and has requested US$133.5 million for research and development in FY2026, the US Congressional Budget Office (CBO) estimates each ship will cost $4.4 billion—33% more than the US Navy’s $3.3 billion projection.

The DDG(X) is intended to replace the Arleigh Burke-class destroyers and Ticonderoga-class cruisers with enhanced power systems, increased payload capacity and the ability to field directed-energy weapons.

However, a June 2025 Government Accountability Office (GAO) report highlighted that critical technologies—including the Integrated Power System (IPS) and hull form—remain immature and may not be fully tested before the ship enters detailed design.

That’s raising red flags about cost and schedule—further compounded by August 2024 updates to operational requirements made to accommodate faster speeds and higher electrical loads, with no updated timelines or cost estimates provided.

Lawmakers must weigh whether DDG(X)’s ambitious design justifies its cost and whether the US Navy is doing enough to manage risks as it transitions from existing destroyer programs.

The DDG(X) program embodies the US Navy’s effort to field a technologically advanced destroyer capable of countering China’s growing surface fleet, but it faces significant technology maturity challenges and industrial constraints that threaten to delay deployment.

In terms of tactical capability, Missile Threat notes that the AN/SPY-6 active electronically scanned array (AESA) radar slated to be installed on the new class is 30 times more powerful than the current AN/SPY-1 and can track over 30 times the targets, enabling simultaneous ballistic missile defense, air defense and surface warfare.

Defense Daily reported in January 2022 that the DDG(X)’s baseline combat suite includes two 21-cell Rolling Airframe Missile (RAM) launchers and 32 MK 41 vertical launch system (VLS) cells, with potential upgrades including two 600-kilowatt lasers, a third 150-kilowatt laser, and 12 Large Missile Launcher cells for hypersonic weapons.

James Black mentions in a January 2024 RAND article that such weapons aboard ships offer precision strike capabilities at the speed of light, reduced engagement costs and deep magazine capacity—traits invaluable for countering fast-moving aerial threats, drones and missiles.

Black notes that a 10-second laser shot may cost only $13, massively undercutting missile interceptor prices. He adds that lasers reduce logistical strain, can quickly retarget and offer deep magazines, but suffer from weather limits, require stable platforms and strain power systems.

Although the GAO notes that IPS technology is still in development, nuclear propulsion for cruisers and destroyers could be feasible, as the US Navy previously operated such ships during the Cold War. However, renewed great power competition with China and Russia might prompt the US to revisit that idea.

Jordan Spector argues in a July 2025 Proceedings article that reviving nuclear propulsion for cruisers and destroyers offers clear advantages in power and endurance. He states that Generation IV reactors are more economical, require less maintenance and eliminate midlife refueling, supporting high-energy weapons like railguns and lasers for sustained combat operations without losing mobility.

Spector notes that nuclear vessels are less vulnerable to logistics interdiction, especially as China’s capacity to disrupt fuel supply chains grows. However, he highlights challenges such as port access restrictions, limited nuclear-certified shipyards, significant infrastructure costs and historical expense concerns.

The operational need for a large surface combatant such as the DDG(X) may be driven in part by the massive growth of China’s People’s Liberation Army Navy (PLAN), especially in large surface combatants such as the Type 055 cruiser.

According to the US Department of Defense’s (DoD) 2024 China Military Power Report (CMPR), the PLAN has significantly expanded its fleet of large surface combatants, reflecting a strategic emphasis on blue-water capability.

As of 2023, the report states China fielded over 370 ships, including at least eight Renhai-class (Type 055) cruisers, each displacing approximately 13,000 tons and equipped with 112 VLS cells. The report notes this underscores China’s push to project power through a technologically sophisticated fleet.

Eric Wertheim, writing in March 2023 for Proceedings, says the Type 055 embodies China’s ambition to field high-end blue-water combatants with extensive multi-domain capabilities.

The writer notes China’s Type 055 displaces up to 13,000 tons and is armed with 112 universal VLS cells capable of deploying HHQ-9B long-range surface-to-air missiles, YJ-18 antiship cruise missiles, YJ-21 hypersonic missiles and potentially antisubmarine or land-attack weapons.

He adds that the class integrates the Type 346B AESA radar, towed and hull-mounted sonar suites and variable-depth sonar for layered detection, with shipboard sensors enclosed in a stealth-enhancing integrated mast.

Additionally, Wertheim states that the Type 055’s other armaments include a 130-millimeter main gun, HHQ-10 point-defense launcher, close-in weapons systems (CIWS) and dual maritime helicopters, giving the platform comprehensive strike, defense and intelligence, surveillance, and reconnaissance (ISR) reach.

Given such developments, Brent Sadler mentions in an April 2023 article for The Heritage Foundation that as tensions with China intensify, the DDG(X) program stands as a strategic imperative for maintaining US naval dominance.

Sadler underscores that China’s shipbuilding surge, coupled with the US’s aging fleet, risks capability gaps without timely DDG(X) deployment. He points out that with only two US shipyards producing large surface combatants, early and predictable investment is crucial.

He notes that a funded signal today enables Huntington Ingalls and Bath Iron Works to commit to facility upgrades and workforce expansion, mitigating production delays. He adds that integrating a proven acquisition model like the Virginia-class Integrated Product Team (IPT) ensures yard constraints are addressed during design, improving fabrication efficiency.

Sadler warns that delayed action risks ceding US naval initiative in a high-stakes theater such as the Pacific. Whether DDG(X) becomes the US Navy’s trump card or a billion-dollar trap will hinge on decisions made before the first keel is even laid.