As the Navy works to cajole a lame-duck Congress into approving the Navy’s proposal to build 10 variants of each LCS model, it is interesting–and potentially educational–to observe the shipbuilders who have skin in this fight–the recently divorced General Dynamics/Austal team, and the Marinette/Lockheed team.
Marinette Marine: Puttin’ on a show!
In Wisconsin, Marinette, after a premature shipyard celebration, is, as the prospects for the LCS “dual buy” get increasingly uncertain, resorting to a bit of theater, imposing a two-day shipyard furlough as they move the PCU Fort Worth into place for a scheduled December 4 launch. And, just to make things hit home even harder, the yard’s President has announced that 200 workers (or so) will be given a longer layoff on December 4, just before Christmas. Or just before Congress closes up shop. They’re blaming the delayed LCS contract:
After appearing at a St. Norbert College event in De Pere Tuesday morning, Marinette Marine CEO Richard McCreary said the layoffs are mainly due to the delay in the expected littoral combat ship contract with the US Navy.
“Originally LCS was supposed to be awarded last July, then it was August, then it was September, and obviously we’re in November marching into December.”…
…Even though the company’s president says they’ll try to bring back workers as fast as possible, having this happen around the holidays makes it tough.
“Any time in December, that’s going to cut people’s holiday pay out, which for us averages to like ten days or something like that. So not only will they be going on unemployment before Christmas, they’ll be taking a huge cut in pay also,” pipe fitter John Semrau said.
That’s leading to some pushback that gives a little insight on how Marinette strained to get LCS-3 done. Marinette is having trouble finding steady work for it’s shipbuilders (their NOAA Fishery Research Vessel is only getting started and the Alaska Regional Research Vessel is suffering design problems):
That same person posted, “The management brought in 70-100 contractors so they could have the LCS (littoral combat ship) 80 percent complete when it hits the water, and now I’m going to lose my job because of this.”
McCreary confirms the company brought in subcontractors for two months to help with the Navy combat ship. He argues the company has to abide by the Navy’s schedule and get the work done by the ship’s launch date, which is December 4th.
Even worse, it looks as if Marinette’s corporate parent, the Italian-government-sponsored Fincantieri, is still not delivering much more than their long-promised $100 million-dollar investment in shipyard modifications (a $10 million dollar expansion of the manufacturing shop is underway)–which is going to cause problems for Marinette’s planned bid for the LCAC(X) or ship-to-shore connector [Edited to reflect the fact that Marinette’s investment is underway–but head down to the comments to get a little more background on the capital improvements underway at each shipyard.]
From this distance, Marinette looks more than a little hollow. A Potemkin shipyard, so to speak.
Austal: We’re a little to busy to talk.
In the south, Austal, buoyed by the JHSV contract and in the midst of work on the LCS-4, isn’t saying anything. Rather than talk layoffs, the company is simply projecting strength, and hiring people. Thanks to Austal, companies as far away as Iowa (Aluminum producer Alcoa) are adding folks.
Austal isn’t even celebrating. Rather than celebrate, the company joined Alabama officials the other week to open a massive, $12 million dollar Maritime Training Center. A short walk away from Austal’s brand-new $100 million dollar ship manufacturing center, the new facility is, basically, Austal’s clubhouse–a way to sift for good workers and hone the skills of the workers already on site.
General Dynamics: Bath crushing some sour grapes:
The only public comment coming from the Independence Class side of the house is the sour grapes flowing from the Bath shipbuilding unit of General Dynamics. After trying to work around the Navy’s original RFP, General Dynamics took the risk of cutting relations with Austal, with the intention to serve as the second-bidder for the follow-on LCS contract of 5-10 hulls.
If the split buy goes through, the Bath yard gets left out in the cold (though I strongly suspect that the DDG-1000 and DDG-51 margins are going to be far higher than what might have come from the LCS contract).
Maine’s Senator Susan Collins has taken up the case, and helped restrain Congressional enthusiasm for the split-buy plan:
The Navy proposal “represents an unexpected reversal of its procurement plans” and would make it unlikely that Bath Iron Works could compete for the construction of the ships, said Collins, a Maine Republican who serves on the Armed Services Committee.
And though General Dynamics hasn’t officially said anything about the split-buy, it has pointedly (and rather hurriedly) announced the shut-down it’s LCS design center of excellence (even though the facility was slated for a shut-down months ago):
“The work (in that building) primarily involved LCS design, which we’re really no longer involved with in a big way, so the folks who were out there are now moving back into other areas of the company,” BIW spokesman Jim DeMartini told The Times Record this week…
…DeMartini stopped short of saying there would be no layoffs as a result of the demise of BIW’s involvement in the LCS program, but he said moving out of the Industrial Parkway facility is not a sign of job cuts. He said the employees who were working there are primarily being moved to buildings where work on other ship programs is taking place.
It doesn’t feel like there is any love lost here. But that could change…
Conclusion: Marinette in trouble.
EN ROUTE–RIMPAC 2010
So…with this information, what does it tell us?
I think the split buy is going to have a hard time.
If the dual-buy dies in Congress, and the Navy pulls the trigger on a downselect, I don’t think LCS-1 is going to win. I hold to my original assessment–LCS-2 can, and should, win this. LCS-1 may eke out a win on cost, but I don’t see that platform winning a contest and a re-compete. But, then again, I am an optimist.
Frankly, I wonder just how prepared Marinette Marine actually is for the contract. Is that yard ready to grow to take this 10-ship fabrication contract? I don’t see it….Where (and when) will the shipyard recapitalize? Where will it find trained people? In short, where’s the manufacturing sinews? Given the contractual timelines, I don’t see it.
Even worse for Marinette, if the split-buy dies in Congress, given Marinette Marine’s work-flow hiccups, the shipyard is in serious trouble. In the event of an expensive and lengthy legal contest, the workers that built the LCS-1 and 3 are gonna go away. Even if LCS-1 wins under the original RFP, delay kills Marinette’s LCS workforce.
Even with the split-buy, that yard looks like it is on the verge of loosing the nucleus of their LCS workforce. Add in any delay, those workers are pretty much gone. Good-bye. See ya.
Austal, on the other hand, has a new yard, a complete training center—and lots of work ready to sustain trained workers in the event of a contested contract. The shipyard is set out with sufficient space to grow, and once the LCS contract gets inked, Austal can simply pull out some blueprints and grow–a simple glance at low-rez overhead imagery can show you that they’ve already pre-prepped building sites for their yard growth. (as the comments below attest, Austal is ready to drop another $100 million dollars to double their manufacturing facility. Other investments–offices, manufacturing/launch sheds, etc.–will follow from that.)
So, with this in mind, I’m getting somewhat concerned about the LCS-1 variant. The design leaves me cold, and I don’t think Marinette has the manufacturing heft to pull off a 10-ship contract in a timely fashion. Austal does. And should the LCS dual-buy devolve into an LCS duel over contracts, I favor Austal’s chances. They can hunker down and fight without fear of loosing their work force.
At some point, that manufacturing strength speaks for itself.
Hopefully Congress–and the Navy–agree. But…sometimes I suspect that Austal has been a little too closed-mouthed, and that too few people out there know what that band of upstart shipbuilding rebels on Mobile Bay have actually gone and done…
{ 14 comments… read them below or add one }
Chuck Hill–
Great stuff on the OPV. Do keep it coming.
Who was the genius who pushed stern ramps? Where did that great new idea that hasn’t really work come from? Anybody know?
Hey Ken–thanks for the note! If you can stand it, I have one last Fincantieri-bashing post and then I’ll let you put up some pro-LCS 1 stuff if you want.
Craig, sorry for the late response — Fort Worth is a side-launch into the river, should be just as cool as Freedom’s launch.
The other problem with stern launching from the LCS2 design is that the center hull is narrower with more dynamic flow while the under deck height is taller and placing the lift frame higher. I surw would like to see OPTEVFOR’s coments on both stern launch systems?
I like davits but they take up deck space and can be less stable when placed too high up as in both LCS main decks.
When I see foreign navies launching CB90s and large LCMs out of davits, I conclude the USN is once again on a wrong course design wise.
P.S. I have launched from davits and by crane (a method I do not recommend). Perhaps the Navy learned that during the recent sailor casualty while being launched by an LPD crane?
To deckplate – Having witnessed dynamic stability testing of mono-hulls, catamarans, and trimarans to beyond SS8, I would rather take my chances in the ultra-stable trimaran than in a butt-cheek fitted monohull.
Not only did the latest Offshore Patrol Cutter concept rendering delete a stern ramp, http://cgblog.org/2010/11/13/new-renderings-of-proposed-opc/, the presentation to industry specifically stated there would be no stern ramp. This makes me think the ramp on the National Security Cutter has been less than completely successful.
http://cgblog.org/2010/11/16/offshore-patrol-cutter-opc-update-nov-2010/
The Coasties’ latest OPC renderings notably ditch stern ramps or other such “modern” solutions in favor of davits for their RHIBs. Wonder if the “refined” LCS designs might not make the same move.
The WPE has been making regular runs around WestPac since it was chartered by MSC back in 2001. The Hawaii Super Ferrys went out of business because of objections and blockades by environmental activists. The HSF were sold at auction by MARAD and it is expected that they will be bought or chratered by MSC for further naval service since the WPE charter is about to expire and Swift’s charter is up next year.
I cannot understand WHY the USN is using these hybird aft launching system on the LCS? I have seen the LCS1 up close and it looks like a Star Wars trapeze. There are plenty of good modern davits design available which could launch large RHIBs loaded quickly. It should be noted that the JHSV has a RHIB which is davit launched. Her stern is otherwise encumbered.
Hi Deckplate–
This is the first I have heard of underbidding for LCS-4. And, in a technical sense, Austal would not be the bidder anyway–the prime contractor for LCS-4 is General Dynamics.
As far as the JHSV “parent” hulls…technically, that honor goes to Austal’s Westpac Express–which is, right now, operational. In October of this year, the ship made–among other work–three trips between Okinawa and Subic–carrying, according the MSC, more than 1,000 Marines and 500 tons of cargo. The two catamarans you discuss were made for civilian service, used in civilian service, and then abandoned. Can’t speak to how they were maintained or operated…but, by all measures, the Westpac Express has been a resounding success.
Given that the 37 million funding granted for the LCS-1 PSA expires in Jan 2011, I hope they are, uh, done. Or, if not, that they are shifting money between accounts, so both platforms can get what they need to get in the game.
I can see where the tie-down testing might be an adventure–binding a steel tie-down fitting into aluminum is tricky, time-consuming and costly. And it is something that has been solved on the JHSV–Alcoa crafted aluminum tie-downs that work great. Hopefully we can see that moved to LCS.
Haven’t heard the LCS-1 is doing that great on CBRN protection either. It’s an area that, for both ships, needs improvement. Would love to hear more details about the aluminum cracking, door issues, and the stab system (are you sure it cracked? Or was it operated incorrectly?)
But, that said, I could counter with a few issues and uglies for LCS-1…starting with, uh, well, how’d that turbine replacement go?
The LCS-2 cannot launch any watercraft. Functional issues plus the overhead that supports the launching system has cracked and will crack more. The roll fin structure cracked going to Norfolk. The hull is rated by NAVSEA at SS#7 not #8 like the LCS-1.The LCS-2 stern doors and side ramp are structurally and functionally unreliable. LCS-2 compartment pressure tests need buckets of Sikaflex and pull tests of tie down fittings are an adventure. Fire insulation hangs in shreds off fire zone bulkheads on LCS-2
MORE FACTS: The LCS-4 is way behind sked. Yes, it is. The LCS-2 is still not finished and is taking money away from LCS-1 PSA to try to get finished. The LCS-1 needed two IPDA’s, the LCS-2 will need three.
Aren’t the JHSV parent hulls tied to the pier right now?
One (possible) non-fact in my entire e-mail: Austal put in grossly low ball bids for LCS-4. Hence the delays.
I thought one of the evaluation factors for the next-gen LCS was construction costs? Wouldn’t those be affected by building halls and new facilities?
Hi Ken–
Yeah, the improvements are underway. But let me discuss the Fincantieri investment a bit–first, their $100 million-over-five-year investment is being split between Bay Shipbuilding, Ace Marine, Cleveland Ship Repair….and Marinette. Over the course of this year they will have invested $40 million. Fine and good. Then there is $60 million planned over the next four to five years…Spread around between four facilities? I…guess that’s…better than nothing. But still…that can’t hold a candle to Austal USA’s cavalcade of recent investment:
Let’s review this–Austal USA got started in 1999. In 2009, they opened their $100 million dollar modular manufacturing facility–an investment that was in addition to the $120 million dollars of capital investment they have put into the yard since founding. They’ve also gotten the $12 million dollar training facility–which, I might add, clocks in at $2 million more than what Fincanteri is spending on Marinette’s fabrication bay expansion….
And I assume they’re ready to pull the trigger on the second phase of the modular facility–which is, I presume, going to be another $100 million dollar investment. Add in maybe another couple of ship manufacturing sheds, that’s….a hell of a lot more than what Fincanteri has put on the table up at Marinette. Industrially, there’s no contest.
Trying to hold up Marinette Marine’s comparably tiny $10 million-dollar expansion of their fabrication building to Austal’s big $100 million dollar modular fabrication facility is…well…sad. IMO, Marinette is getting totally beat…
But then again, the RFP does not permit evaluators to compare the industrial strength of each yard and assess the ability of each yard to actually pull it off.
Hey…and while I have you here, is LCS-3 going to be launched via slipways or are they moving to the dull-yet-safe routine of launching from a barge? If I recall correctly, Fincanteri was talking about doing that for LCS-3, but I don’t know if they got their act together in time…
MMF details here:
http://blog.al.com/press-register-business/2009/11/post_11.html
Fincanteri Investment details:
http://www.marinettemarine.com/mmc%20press%20releases/MMC%20_Fincantieri%20Facility%20Improvement_Press%20Release%2011_5_09.pdf
http://www.marinettemarine.com/mmc%20press%20releases/FINCANTIERI%20CONTINUES%20INVESTMENT%20IN%20MMC__FINAL_3-5-10.pdf
http://www.peshtigotimes.net/?id=13385
http://www.defensenews.com/story.php?i=4070494
Not quite fair to highlight Austal’s shipyard improvements while ignoring Marinette’s and pretending they haven’t started. For example, they have been working since March on a significant expansion to their construction building – see http://www.marinelog.com/DOCS/NEWSMMIX/2010mar00151.html.
In that article, you’ll note that Fort Worth was then 30 percent complete. She is now near 80%. I’d say that finishing half the ship construction in 8 months is a pretty good indication of the ability of the yard to meet its commitments.
If you think about where the yard is located, then you might also understand why the urgency to launch in early December. If they push past that date, the river is hard frozen and they have to wait until March.
At the risk of sounding even more dickish than usual, MM would be in a better position today if they hadn’t gone chasing USN contracts. NG may be the poster child for crapping up perfectly good shipyards, but the LCS-1 team is running a hard race for second.
Collins has been a pretty poor ally for BIW, of all the options on the table to get Maine some work she’s lobbying for a chance at second-source for a hull the Navy hasn’t committed to buy. How about pushing for a fourth DDG-1000? Or Arctic OPVs?