According to Reuters, the U.S. Navy ordered Lockheed Martin Corp.
to halt work on one of its two littoral combat ships due to significant cost overruns, the service said on Friday.
The Navy said Lockheed's work would be stopped immediately for 90 days, while costs are reviewed. The Navy would not disclose how much costs had risen, but defense officials called the overrun significant.
The $1.3b littoral combat ship program is a major piece of the Navy's vision for its future fleet.
Lockheed, the top U.S. defense contractor, is building the first and third of the Navy's littoral combat ships, designed for closer-to-shore missions, while General Dynamics Corp. is building the second and fourth.
Lockheed won the $198m contract in June for the second ship. According to the Navy, work will be stopped on the second ship because of cost overruns on both its vessels.
U.S. Navy shipbuilding
has been plagued by billions of dollars in cost overruns and lengthy schedule delays. The U.S. Government Accountability Office has estimated cost growth of 27 percent for first-in-class ships.