2015/12/25

The economic case against OPVs

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For  mysterious reasons the idea of OPVs is incredibly 'sexy' and intuitive to many people. This nonsense justifies a dedicated post:

What do you need in war (and for deterrence of war)? Combat capability. Warships are built for it,  OPVs are mere targets in combat.
What do you need in peacetime?  Policing and rescue ships. Both warships and OPVs can meet this need.

Italian Coast Guard patrol boat U. Diciotti, CP-902 (c) A. Deligiannis

Scenario A: A fleet with warships, no OPVs.
Result: Enough warships for war's needs, enough ships for policing and rescue.

Scenario B: A fleet with OPVs, no warships.
Result: No ships for war's needs, enough ships for policing and rescue, least costs.

Scenario C: A fleet with many warships and many OPVs.
Result: Enough warships for war's needs, more than enough ships for policing and rescue.

Scenario D: A fleet with few warships and many OPVs costing as much as in scenario A.
Result:Not enough warships for war's needs, still more than enough ships for policing and rescue.

Scenarios A-D point to an all-OPV fleet (scenario B) being a decent (cheap) choice for countries that won't muster enough warships for war anyway.

Table: Comparison of expenses of a warship and an OPV for policing and rescue duties:
(naval warmaking capability required)
 
warship OPV
development sunk costs sunk costs
production sunk costs sunk costs
fuel sunk costs yes
manning sunk costs yes
munitions negligible negligible
 
Why the warships' manning and fuel expenses are sunk costs? Simple; the warship would be out at sea for training anyway.
Warship fuel and manning expenses may be (slightly or very much) greater in this case, but they're sunk costs!

Now a table about a situation in which warships are on duty and the purchase of an OPV is being considered:
 
warship OPV
development sunk costs yes
production sunk costs yes
 
The introduction of an OPV is not cheaper, but truly expensive if your country already has warships!


People who just L O V E the idea of OPVs fall for the sunk costs trap. They don't get that sending a 10,000 ton warship to deal with some illegal fishing boats is actually cheaper than to develop, purchase and send a 1,500 ton OPV to do the job. They don't get this because they look at total costs - including the costs that are not being influenced by the decision. That's about the most fundamental mistake you could do in an economic decision.

To avoid total costs (except in investment decisions) and look at the relevant costs only is extremely counter-intuitive to people in uncommon decisions and incredibly difficult to hammer into their brains.

After all, frigates and destroyers can easily do what the best and biggest OPVs can do:
Patrol, withstand severe weather at sea, search and rescue, boarding, sea search, ship identification, helicopter operations, launching and recovering small boats, treat minor injuries, tow a ship or boat, extinguish fires with water gun. A few policemen instead of marines on board would suffice to meet legal authority requirements.

Warship crew training would not suffer much from offshore policing duties: All those activities listed above need be mastered by a warship crew as well. Only the training of warship crews for combat as part of a battlegroup would differ, and this applies only to tactical centre and bridge teams. It can also be done in a small fraction of the overall time at sea.

In fact, navies did all those "OPV" jobs with warships for centuries. That's what the original "frigates" and later "cruisers" were for, albeit smaller sloops (useful as scouts and messengers in wartime) were used in even greater numbers for it during the age of sail.

Not convinced?

To take into account the costs called "sunk costs" above is the same as if you choose whether to ride the bus or your 30,000 $ car to the cinema and conclude that driving your car is too expensive "because its purchase price was 30,000 €".
The purchase price does not matter! Depreciation (wear & tear) and fuel costs matter only - the not-sunk costs!


Example U.S.Navy and U.S. Coast Guard: It's unthinkable to have a navy but no or hardly any Coast Guard, right? Yes, it's unthinkable because the U.S.Navy doesn't care about its home waters. They care about all other waters, it's the cult of "forward deployment" instead of "defense".
The U.S. Navy could easily replace all large USCG cutters in action with frigates and destroyers.

Even more stupid than adding OPVs to a fleet of warships is what Germany did and does:
It buys ships with hardly more than an OPV's capability at the price of real warships. K130 and F125 are outright scandals.


I can guarantee - GUARANTEE - that even if not today, some readers will still favour OPVs sooner or later. This irrational, intuitive nonsense will not die.


I arranged for Chuck at Chuck Hill's CG blog to prepare a pro-OPV rebuttal to this, so feel free to look at it. He's the coast guard expert in comparison to me. Comments are closed here, open there.

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