Post by ferryfast admin on May 23, 2011 9:27:19 GMT -5
For Austal, expanding clout in Washington depends on building quality ships in Mobile
blog.al.com/live/2011/05/for_austal_expanding_clout_in.html
WASHINGTON — How was Austal USA viewed on Capitol Hill before recently winning two billion-dollar Navy shipbuilding contracts?
“I don’t think Austal was even viewed in Washington before the Joint High-Speed Vessel and LCS (littoral combat ship) awards,” its chief operating officer, Joe Rella, said with a laugh.
“They now are taking notice and saying, ‘Wow, all of a sudden here’s a company we weren’t even familiar with.’”
Austal’s Mobile shipyard doesn’t yet enjoy the clout in Washington of the nation’s more established shipbuilders. And, said industry analysts, it has little chance of competing with the eight-figure lobbying operations run by its rivals’ parent companies.
But fortunately for Austal, its sway in Washington won’t be decided in congressional offices or on K Street, the capital’s lobbyist row. Instead, the company’s reputation will probably sink or float with the ships that leave Mobile Bay for Navy service.
For Austal, “The growth has been significant. The question is: How do they manage that work?” said Jay Korman, a naval analyst with the Washington-based Avascent Group. “I think performance trumps it all.”
In 2008, Austal won a $1.6 billion contract to build 10 Joint High-Speed Vessels, fast-moving transports for troops and equipment that can operate in shallow water.
Congress approved an even larger contract for Austal in the closing days of last year: 10 littoral combat ships to be built for $3.6 billion. The warships are designed to take on mines, submarines and other vessels and can also move at high speed and in shallow water.
With the contracts, Austal’s Mobile shipyard has more than doubled in size and the company has emerged as a force in military shipbuilding.
It’s too soon to say whether Austal can stay in that position, according to Jan van Tol, a former Navy captain who is now a senior fellow at the Washington-based Center for Strategic and Budgetary Assessments, a defense think tank.
“Over time, performance, performance, performance is what counts,” van Tol said. “That’s not to say the lobbyists and the other things don’t have influence in Washington.”
Last year, Austal spent $240,000 to lobby Congress, according to the watchdog group Open Secrets.
Northrop Grumman, which oversaw major shipyards in Louisiana, Mississippi and Virginia, spent $15.7 million. General Dynamics, which has shipyards in California, Connecticut and Maine, spent $10.9 million.
Rella said that Austal’s lobbying efforts, coordinated by Washington’s Van Scoyoc Associates, are “sufficient and efficient.”
Unlike Austal, both Northrop and General Dynamics are much larger than their shipbuilding components, and regularly vie for other types of military contracts. Their lobbying costs reflect this broader effort.
In late March, Northrop spun off its shipyards into a new company called Huntington Ingalls Industries, which will focus on shipbuilding.
Rella said that the support and “absolute, free access” that he gets from the state’s congressional delegation — particularly Rep. Jo Bonner, R-Mobile, and Sens. Jeff Sessions, R-Mobile, and Richard Shelby, R-Tuscaloosa — allow Austal to hold sway in Congress.
While visiting Sessions in Washington, for example, the senator “personally took me around to see three other senators to discuss the LCS competition,” Rella said. Such support can’t be bought at a lobbying firm, he added.
Because of Alabama’s relatively small size, companies such as Austal can easily catch the ear of home-state lawmakers, according to Rella. In more populous states, they might have to “stand in line,” he explained.
He summed up the advantage by borrowing a slogan used by Faulkner State Community College in Baldwin County to tout small class sizes: “My name is Joe, and my congressman knows it.”
Korman said that while Austal is “on the pace of doing a lot of big things, they haven’t lost the training wheels yet.”
One factor that could propel the company into a larger role in U.S. shipbuilding would be better cooperation among government leaders from various regions of Alabama, he said. Too often, according to Korman, support for Austal appears to fade as one drives away from the coast.
Rella said he hasn’t seen such a geographic divide in the state, adding that he’s enjoyed support from leaders across Alabama.
But Alabama’s overwhelming Republican leanings can be a challenge, Rella acknowledged. No other state with a major shipyard, except for perhaps Mississippi, is so thoroughly tied to one political party.
“That clearly can work against you. There’s no doubt,” Rella said. “There may be completely unrelated issues that spill over into what could be a perfectly logical and sensible bill.”
Still, Rella noted that having a strongly Republican congressional delegation likely diminishes infighting.
Moreover, political issues may ultimately have little bearing on Austal’s fate, he said.
“Maybe I’m a bit naive about this, but I still believe if you do a good job at what you’re supposed to be doing, the rest will take care of itself,” Rella said.
blog.al.com/live/2011/05/for_austal_expanding_clout_in.html
WASHINGTON — How was Austal USA viewed on Capitol Hill before recently winning two billion-dollar Navy shipbuilding contracts?
“I don’t think Austal was even viewed in Washington before the Joint High-Speed Vessel and LCS (littoral combat ship) awards,” its chief operating officer, Joe Rella, said with a laugh.
“They now are taking notice and saying, ‘Wow, all of a sudden here’s a company we weren’t even familiar with.’”
Austal’s Mobile shipyard doesn’t yet enjoy the clout in Washington of the nation’s more established shipbuilders. And, said industry analysts, it has little chance of competing with the eight-figure lobbying operations run by its rivals’ parent companies.
But fortunately for Austal, its sway in Washington won’t be decided in congressional offices or on K Street, the capital’s lobbyist row. Instead, the company’s reputation will probably sink or float with the ships that leave Mobile Bay for Navy service.
For Austal, “The growth has been significant. The question is: How do they manage that work?” said Jay Korman, a naval analyst with the Washington-based Avascent Group. “I think performance trumps it all.”
In 2008, Austal won a $1.6 billion contract to build 10 Joint High-Speed Vessels, fast-moving transports for troops and equipment that can operate in shallow water.
Congress approved an even larger contract for Austal in the closing days of last year: 10 littoral combat ships to be built for $3.6 billion. The warships are designed to take on mines, submarines and other vessels and can also move at high speed and in shallow water.
With the contracts, Austal’s Mobile shipyard has more than doubled in size and the company has emerged as a force in military shipbuilding.
It’s too soon to say whether Austal can stay in that position, according to Jan van Tol, a former Navy captain who is now a senior fellow at the Washington-based Center for Strategic and Budgetary Assessments, a defense think tank.
“Over time, performance, performance, performance is what counts,” van Tol said. “That’s not to say the lobbyists and the other things don’t have influence in Washington.”
Last year, Austal spent $240,000 to lobby Congress, according to the watchdog group Open Secrets.
Northrop Grumman, which oversaw major shipyards in Louisiana, Mississippi and Virginia, spent $15.7 million. General Dynamics, which has shipyards in California, Connecticut and Maine, spent $10.9 million.
Rella said that Austal’s lobbying efforts, coordinated by Washington’s Van Scoyoc Associates, are “sufficient and efficient.”
Unlike Austal, both Northrop and General Dynamics are much larger than their shipbuilding components, and regularly vie for other types of military contracts. Their lobbying costs reflect this broader effort.
In late March, Northrop spun off its shipyards into a new company called Huntington Ingalls Industries, which will focus on shipbuilding.
Rella said that the support and “absolute, free access” that he gets from the state’s congressional delegation — particularly Rep. Jo Bonner, R-Mobile, and Sens. Jeff Sessions, R-Mobile, and Richard Shelby, R-Tuscaloosa — allow Austal to hold sway in Congress.
While visiting Sessions in Washington, for example, the senator “personally took me around to see three other senators to discuss the LCS competition,” Rella said. Such support can’t be bought at a lobbying firm, he added.
Because of Alabama’s relatively small size, companies such as Austal can easily catch the ear of home-state lawmakers, according to Rella. In more populous states, they might have to “stand in line,” he explained.
He summed up the advantage by borrowing a slogan used by Faulkner State Community College in Baldwin County to tout small class sizes: “My name is Joe, and my congressman knows it.”
Korman said that while Austal is “on the pace of doing a lot of big things, they haven’t lost the training wheels yet.”
One factor that could propel the company into a larger role in U.S. shipbuilding would be better cooperation among government leaders from various regions of Alabama, he said. Too often, according to Korman, support for Austal appears to fade as one drives away from the coast.
Rella said he hasn’t seen such a geographic divide in the state, adding that he’s enjoyed support from leaders across Alabama.
But Alabama’s overwhelming Republican leanings can be a challenge, Rella acknowledged. No other state with a major shipyard, except for perhaps Mississippi, is so thoroughly tied to one political party.
“That clearly can work against you. There’s no doubt,” Rella said. “There may be completely unrelated issues that spill over into what could be a perfectly logical and sensible bill.”
Still, Rella noted that having a strongly Republican congressional delegation likely diminishes infighting.
Moreover, political issues may ultimately have little bearing on Austal’s fate, he said.
“Maybe I’m a bit naive about this, but I still believe if you do a good job at what you’re supposed to be doing, the rest will take care of itself,” Rella said.