August 13, 2020 | International, Naval
By PAUL MCLEARYon August 12, 2020 at 4:04 PM
WASHINGTON: A top Navy official today tried to clarify a Pentagon information paper leaked last week which warned that “at least one” of the seven shipyards that churns out ships for the Navy could close unless Congress handed over billions more to the service.
As part of an $11 billion package the Pentagon is requesting from Congress to mitigate the impact of COVID-19 on the defense industry, the Navy is requesting $4.7 billion in part to ward off the chances “at least one” of the big seven shipyards shutting down. The paper, which has been delivered to lawmakers on Capitol Hill, also warned of over 100,000 lost jobs across shipyards and factories that make aircraft and other weapons for the military.
But the Navy's top acquisition executive told reporters today that the wording continued in the paper might leave too much out.
“The words could be taken out of context,” James Geurts said. “There probably should be the word ‘temporarily' in there.” If a shipyard started to see a significant portion of its workforce test positive for COVID, “we might have to temporarily close down the shipyard for a period of time until we got it under control. Not that we would have to shut down a shipyard permanently.”
The memo contains no such caveats, however. It flatly states a shipyard could close unless the Navy gets the funding boost.
Asked where the paper came from, and who it was intended for, DoD spokesman Christopher Sherwood told me via email the department “provided informational material to our oversight committees when asked about the impacts COVID-19 has had on the Defense Industrial Base and our suppliers.”
The Navy has gone to great lengths to help its shipyards weather the COVID storm, pumping $130 billion into its supplier base this year in upfront payments, spending that is 25% higher than at this point last year.
But some yards have experienced pain keeping to schedule, with uncertain futures ahead as the Navy looks to change its fleet mix in the coming years to better compete with China and Russia.
Mark Cancian, a defense expert at the Center for Strategic and International Studies, acknowledged that all Navy shipyards “have a backlog of work, including Bath Iron Works, which was the subject of speculation about closing.” Bath, already six months behind on building seven destroyers in dock, is stumbling to the conclusion of a six-week strike by 4,300 shipbuilders which will likely make those delays even longer.
Likewise, the Mississippi-based Austal is looking at the end of the road for its contract to build dozens of aluminum Littoral Combat Ships in a few years, which would likely mark the end of the Navy's interest in buying aluminum hulls. That shipyard “would be at more risk” Cancian said.
Neither shipyard is any worse off than the others due to COVID-related shutdowns, however, making the Pentagon's point that yards could shut and require COVID relief funds to keep going, an argument that finds few adherents.
There's little doubt COVID is slowing down both ship construction and repair, “but that doesn't mean the Navy doesn't need the ships anymore,” said Bryan Clark of the Hudson Institute. “It just means everything takes longer, but it doesn't necessarily mean that the shipyards are going to close.”
Clark noted that while Bath is in a bad spot with delays to its destroyer work that will be compounded by the strike, the Navy still needs it to build destroyers in the future, since relying on Huntington Ingalls as the nation's only shipyard that can build the ships is too risky.
Add to that the likelihood that the Navy will move toward buying more numerous small cruisers, unmanned ships, and smaller platforms for Marines and away from small numbers of large destroyers and amphibious ships in the future, means there will be more contracts, and work to go around later this decade.
The service is still on track to deliver its much-delayed 30 year shipbuilding plan and force structure assessment this fall, in which several options like a new class of destroyers, a new class of smaller frigates, and smaller hospital ships will all likely find their way into the plans.
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June 10, 2019 | International, Aerospace
By: Sebastian Sprenger COLOGNE, Germany — A lingering dispute between German lawmakers and Airbus could nix immediate plans to move forward with a future Franco-German-Spanish fighter aircraft, Defense News has learned. The kerfuffle goes back to a February request for information by members of the Bundestag's Budget Committee. Citing the government's role as a major shareholder in the company, lawmakers called on the administration to provide in-depth information about Airbus locations, programs and management equities throughout Europe. Airbus is one of two prime contractors for the Future Combat Air System, an ambitious project to field a sixth-generation fighter aircraft by 2040. The envisioned weapon also includes new sensors, drones and a complex data infrastructure, making it Europe's preeminent industrial project for decades to come. Lawmakers in Berlin are worried that German defense-industry interests, presumably channeled through Airbus, could get the short shrift once substantial contracts are up for grabs amid French competition, led by Dassault. The Budget Committee reiterated its request for the company deep dive on June 5, when members approved the initial batch of funds for the FCAS program: $37 million for a study on propulsion options. Lawmakers inserted a note into their approval text that makes answering the February request a condition for entering into follow-on agreements with France. Meanwhile, officials in Paris and Berlin have been planning signing ceremonies for such pacts with Ursula von der Leyen and Florence Parly, the German and French defense ministers, respectively, at the Paris Air Show in mid-June. It's expected the pair will ink the concept study plan and a key governance document called the framework agreement. Meanwhile, the Spanish defense minister, Margarita Robles, is expected to be on hand to sign the program's memorandum of understanding, a more high-level, vague text beginning Madrid's road to full participation. As of Friday, lawmakers had yet to receive the requested information on Airbus, which is to include an analysis of management personnel down to the third tier throughout different locations, separated by programs and individual job functions. As June 10 is federal holiday in Germany, that leaves four business days next week before the Paris Air Show begins. An Airbus spokesman told Defense News on Friday the company is working to resolve the issue and is coordinating with the government. A Defence Ministry spokesman did not immediately return an emailed request for comment. Documents obtained by Defense News suggest that a previous back-and-forth between the Budget Committee and Airbus, through the Ministry for Economic Affairs and Energy, left a bit of bad blood, raising the question of whether the company will comply at all. While executives provided some information — forwarded in a confidential letter to the Bundestag by the ministry on April 26 — Airbus largely claims the detailed data demanded by the committee would needlessly reveal competitive secrets. “Airbus, in return, asks for information about the background of the request,” the company's written response states. “The question must be raised whether other companies where the German government is a shareholder, like Deutsche Bahn [the German rail service], is subject to similar requests.” The company claims to have given the administration a detailed personnel breakdown by subsidiary and nationalities in 2018, which was also offered to committee members. According to Airbus, no lawmakers were interested. Airbus Defence and Space, which would lead the conglomerate's work on FCAS, is based in Ottobrunn near Munich, Germany. As of December 2018, roughly 40 percent of the subsidiary's employees were based in Germany, around 22 percent in France, 27 percent in Spain and 12 percent in the United Kingdom, the company wrote to lawmakers in April. As the FCAS program progresses, Budget Committee members want the government in Berlin to safeguard a 50-50 cost and workshare plan with France. https://www.defensenews.com/global/europe/2019/06/07/german-spat-over-airbus-could-foil-fighter-fest-at-paris-air-show/