Will Bath Build Second DDG 1000?
Swap Envisioned With Northrop's Ingalls Shipyard
Four years after Congress ripped apart a U.S. Navy winner-take-all scheme for building new DDG 1000 Zumwalt-class destroyers, the service and its two chief shipbuilders might be poised for a scaled-down agreement to shift construction of the first two ships from each shipyard to just one yard.
Two DDG 51 destoyers under construction at Bath Iron Works in Maine. (General Dynamics Bath Iron Works)
The result would be that the General Dynamics Bath Iron Works shipyard in Bath, Maine - poised to begin fabrication of DDG 1000 in February could wind up building that ship and DDG 1001, the Michael Monsour.
Northrop Grumman's Ingalls shipyard in Pascagoula, Miss., scheduled to begin fabrication of DDG 1001 this fall, would in turn receive more of the additional DDG 51 Arleigh Burke-class destroyers the Navy now intends to build.
Both shipyards share in building Arleigh Burkes. The Navy had planned to cap the number of DDG 51s at 62 ships, but last summer notified Congress of its intent to drop plans to build seven DDG 1000s, build only two, and instead buy at least eight and possibly more additional 51s.
Congressional concerns, particularly from Maine's Senate delegation, soon led the Navy to amend its plan to restore the third Zumwalt.
Funding for DDGs 1000 and 1001 already has been approved by Congress.
Half the funds for 1002 were authorized in the 2009 budget, with the other half expected to be included in the upcoming 2010 budget request.
The controversial Zumwalts are fraught with questions about the need for the stealthy ships, their potential effectiveness and their cost. The Navy has priced each ship at about $3.3 billion, but key congressional budget analysts have long predicted the true cost will rise to at least $5 billion or more.
The Navy planned to compete construction of the ships between Bath and Ingalls. But in 2005, then-Navy acquisition chief John Young attempted a cost-reduction strategy to award construction of all the ships to only one yard, claiming the elimination of overhead costs for two shipyards would save money. But Congress vehemently opposed the idea and supported maintaining a viable workforce in both yards, and Young dropped his plan.
Young, now the Pentagon's top weapons buyer, reportedly has played a key role in the latest negotiations.
Sources said both shipyards met with the Navy late this fall to discuss swapping current and future destroyer construction contracts. One source said the yards now are waiting to see a more definitive plan from the Navy - a plan which could be close to being put on the table. One key issue, the source said, is who would build the third Zumwalt, DDG 1002.
Neither the Navy nor Northrop Grumman nor General Dynamics acknowledged the negotiations.
"Unfortunately, we're not able to comment as everything is still predecisional," said Lt. Cmdr. Victor Chen, a spokesman for Navy research, development and acquisition chief Sean Stackley.
Northrop spokeswoman Margaret Mitchell-Jones on Jan. 8 said, "We have positioned Northrop Grumman to be the go-to builder of surface combatants, and we will continue to provide the Navy our input into how the shipbuilding plan will impact the industrial base, realizing that this is one of the many factors included in their decision-making process."
Bath Iron Works spokesman Jim DeMartini declined to comment on suggestions that such a swap might be in the works.
Navy sources expressed high confidence in Bath's readiness and ability to build the ships, noting the yard's new $40 million Ultra Hall, erected specifically to build DDG 1000s.
Those same sources expressed doubts about Northrop's ability to smoothly begin construction later this year on the new ships. The Ingalls yard already has one of the most diverse portfolios of any warship builder.
In addition to DDG 51s, the yard also builds LHA 6 and LHD 8 assault ships and LPD 17 amphibious transport docks for the Navy and National Security Cutters for the U.S. Coast Guard.
But the yard has faced steady criticism - particularly from Navy Secretary Donald Winter - for problems with the LPD 17 program, and last year took a $300 million charge to fix electrical problems with the new Makin Island (LHD 8) assault ship.
Early last year, Northrop installed Mike Petters, head of Northrop's nuclear-capable shipyard at Newport News, Va., as head of all its shipyards, including the Avondale operation at New Orleans, La., and the Gulfport, Miss., facility that builds the composite-construction superstructures for the Zumwalts. The Navy was pleased by the move and remains supportive of Petters, but Navy sources also said they were still waiting to see definitive and positive results of his management.
"The Navy understands that it might take [Petters] a bit," a Pentagon source said, "but he is a shipbuilder and understands what needs to happen."
Layoffs at Bath
Bath has had its issues as well. On Jan. 8, the company notified 179 union workers they'd be laid off, effective Jan. 23, because of a lack of near-term work and fluctuations in workload.
"We have already started some advanced production on DDG 1000 and we expect to be ramping up production efforts over the next several months," DeMartini said. "That could create a situation where we may be looking to recall some of these employees. But the near-term situation is what's driving this action at this time."
Another possibility for increased workload at Bath involves a scenario where the shipyard would begin building aluminum-hulled Littoral Combat Ships (LCS). Bath is managing the General Dynamics entry in the Navy's LCS competition, but the ships are built by Austal USA in Mobile, Ala.
Relations between Austal and General Dynamics are strained, and Bath shipyard head Dugan Shipway has not shied away from pointing to locations in his facility where LCS ships could be built. But sources indicate such a move is not now in the offing.
One knowledgeable source said the Bath-Ingalls destroyer swap made good sense.
"I would not be surprised if Bath doesn't build both of the first ships and Northrop picks up new ships" in the upcoming budget plans, the source said. "If the Navy could get both contractors to agree to that with no fighting, it would all work out. But both General Dynamics and Northrop Grumman would have to say it's a great idea." ■
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