Post by ferryfast admin on Oct 18, 2011 10:42:58 GMT -5
Is the Coast clear?
Several Alabama, Mississippi shipbuilders are in the running for a delayed Coast Guard program
Updated: Monday, October 17, 2011, 2:26 PM
Dan Murtaugh, Press-Register
blog.al.com/press-register-business/2011/10/is_the_coast_clear_several_ala.html
MOBILE, Ala. -- The U.S. Coast Guard is in the planning stages of its largest shipbuilding program ever, and several local companies are eyeing the possible prize.
The Coast Guard wants to buy 25 offshore patrol cutters, total cost estimated at about $8 billion, over the next two decades to replace its aging fleet of medium endurance cutters.
The ships will secure ports, waterways and coastlines, conduct search and rescue missions and police waterborne drug and immigrant trafficking, in addition to other missions.
Last year, the service released a list of 13 companies that expressed interest in building the vessel. Five -- BAE Systems, Austal USA, Ingalls Shipbuilding, VT Halter Marine and Signal International Inc. -- have ties to the Alabama/Mississippi coast.
A BAE spokesman told the Press-Register last week that it was no longer pursuing the offshore cutter, but representatives from the other four companies said they remained interested to varying degrees.
The offshore cutter is part of the Coast Guard's Deepwater Program, a $24 billion acquisition plan started in 2007 to modernize the Coast Guard's fleet.
The program has been hindered by delays and cost overruns.
In July, the U.S. Government Accountability Office said the cost of the program had increased at least 20 percent to more than $29 billion and declared the program "unachievable."
John Hutton, the GAO's director of acquisition and sourcing management, earlier this month testified to a House Subcommittee on Coast Guard and Martime Transportation that the service has made improvements since the July report. However, he said, it still needed to take steps to "address the cost growth, schedule delays, and capability shortfalls that have made the approved Deepwater Program unachievable."
The main problem, according to the GAO, appears to be that the Coast Guard is scheduling its shipbuilding program on unrealistic planned funding. For example, the service needs about $1.9 billion a year to meet its baselines, but expects funding levels to be closer to $1.2 billion a year, according to the GAO report.
The shortfalls "contribute to schedule delays and can lead to other issues such as unhealthy competition for funding," Hutton testified
The Coast Guard is funded through the Department of Homeland Security, not the Department of Defense, so the agency does not anticipate the massive cuts in defense spending anticipated in the effort to balance the federal budget.
Schedule delays are already affecting the offshore cutter program. The Coast Guard was supposed to take the first step, releasing a draft list of specifications, last year, but didn't do so until May.
The specifications are general benchmarks the Coast Guard wants the ships to meet. Examples are what kinds of sea states the ships need to be able to operate and survive in, or how fast they need to go, said Brian Olexy, who works for the Coast Guard as a program analyst.
Coast Guard officials are discussing the specifications with officials from several shipyards now, Olexy said. The process will help the Coast Guard understand what kind of tradeoffs it will have to make between things like survivability and speed to be able to stay within budget constraints.
"It's a more considered approach," Olexy said. "Instead of one document, we actually have a dialogue, so everybody gets a better understanding of where we're at."
The next step is releasing a draft of the request for proposal for shipbuilders comment before companies are asked to submit their ship designs and cost estimates. The draft was supposed to go out sometime between April and June, but Olexy said there is now no set date for the release.
For the most part, the delays haven't put a damper on shipbuilders' enthusiasm for the potentially lucrative contract.
In the case of Austal USA, the delay may end up being a benefit, said Craig Hooper, the company's vice president for sales, marketing and external affairs.
Austal's Mobile River shipyard employs about 2,300, making the company Mobile's largest industrial employer.
The Coast Guard has said it wants the offshore cutters to have a steel hull and aluminum superstructure. But Austal only builds ships with aluminum hulls.
Hooper said the delays could help Austal prove to the Coast Guard that an aluminum-hulled cutter could meet its needs. Barring that, a delay gives Austal more time to form a partnership so that it builds the inside of the boat while another yard constructs the steel hull, he said.
"The more time we have, the better it is for us," he said.
Bill Skinner, chief executive officer of VT Halter, said the offshore cutter program is "important for us." VT Halter employs about 1,800 at shipyards in Moss Point, Pascagoula and Escatawpa.
"We're extremely excited," Skinner said. "We'd like to see the request for proposal get out so we can get down to the competition."
Halter's neighbor in Pascagoula, Ingalls Shipyard, is already part of the Coast Guard's Deepwater Program. Ingalls has built three national security cutters, the largest ship in the program, and has contracts to build two more. The Coast Guard plans to build three more beyond those five, but no contracts have been executed.
Ingalls is the second- largest shipyard in America, with more than 10,000 employees. Spokesman Bill Glenn said the company is interested in adding the offshore cutters to its Coast Guard catalog. "Ingalls Shipbuilding looks forward to better understanding the Coast Guard requirements and competing for the platform," he said in a written statement.
Signal International is headquartered in Mobile and has ship repair and building operations in Mobile, Pascagoula and Orange, Texas.
Signal Chief Executive Officer Dick Marler said the company is "monitoring" the offshore cutter program.
Several Alabama, Mississippi shipbuilders are in the running for a delayed Coast Guard program
Updated: Monday, October 17, 2011, 2:26 PM
Dan Murtaugh, Press-Register
blog.al.com/press-register-business/2011/10/is_the_coast_clear_several_ala.html
MOBILE, Ala. -- The U.S. Coast Guard is in the planning stages of its largest shipbuilding program ever, and several local companies are eyeing the possible prize.
The Coast Guard wants to buy 25 offshore patrol cutters, total cost estimated at about $8 billion, over the next two decades to replace its aging fleet of medium endurance cutters.
The ships will secure ports, waterways and coastlines, conduct search and rescue missions and police waterborne drug and immigrant trafficking, in addition to other missions.
Last year, the service released a list of 13 companies that expressed interest in building the vessel. Five -- BAE Systems, Austal USA, Ingalls Shipbuilding, VT Halter Marine and Signal International Inc. -- have ties to the Alabama/Mississippi coast.
A BAE spokesman told the Press-Register last week that it was no longer pursuing the offshore cutter, but representatives from the other four companies said they remained interested to varying degrees.
The offshore cutter is part of the Coast Guard's Deepwater Program, a $24 billion acquisition plan started in 2007 to modernize the Coast Guard's fleet.
The program has been hindered by delays and cost overruns.
In July, the U.S. Government Accountability Office said the cost of the program had increased at least 20 percent to more than $29 billion and declared the program "unachievable."
John Hutton, the GAO's director of acquisition and sourcing management, earlier this month testified to a House Subcommittee on Coast Guard and Martime Transportation that the service has made improvements since the July report. However, he said, it still needed to take steps to "address the cost growth, schedule delays, and capability shortfalls that have made the approved Deepwater Program unachievable."
The main problem, according to the GAO, appears to be that the Coast Guard is scheduling its shipbuilding program on unrealistic planned funding. For example, the service needs about $1.9 billion a year to meet its baselines, but expects funding levels to be closer to $1.2 billion a year, according to the GAO report.
The shortfalls "contribute to schedule delays and can lead to other issues such as unhealthy competition for funding," Hutton testified
The Coast Guard is funded through the Department of Homeland Security, not the Department of Defense, so the agency does not anticipate the massive cuts in defense spending anticipated in the effort to balance the federal budget.
Schedule delays are already affecting the offshore cutter program. The Coast Guard was supposed to take the first step, releasing a draft list of specifications, last year, but didn't do so until May.
The specifications are general benchmarks the Coast Guard wants the ships to meet. Examples are what kinds of sea states the ships need to be able to operate and survive in, or how fast they need to go, said Brian Olexy, who works for the Coast Guard as a program analyst.
Coast Guard officials are discussing the specifications with officials from several shipyards now, Olexy said. The process will help the Coast Guard understand what kind of tradeoffs it will have to make between things like survivability and speed to be able to stay within budget constraints.
"It's a more considered approach," Olexy said. "Instead of one document, we actually have a dialogue, so everybody gets a better understanding of where we're at."
The next step is releasing a draft of the request for proposal for shipbuilders comment before companies are asked to submit their ship designs and cost estimates. The draft was supposed to go out sometime between April and June, but Olexy said there is now no set date for the release.
For the most part, the delays haven't put a damper on shipbuilders' enthusiasm for the potentially lucrative contract.
In the case of Austal USA, the delay may end up being a benefit, said Craig Hooper, the company's vice president for sales, marketing and external affairs.
Austal's Mobile River shipyard employs about 2,300, making the company Mobile's largest industrial employer.
The Coast Guard has said it wants the offshore cutters to have a steel hull and aluminum superstructure. But Austal only builds ships with aluminum hulls.
Hooper said the delays could help Austal prove to the Coast Guard that an aluminum-hulled cutter could meet its needs. Barring that, a delay gives Austal more time to form a partnership so that it builds the inside of the boat while another yard constructs the steel hull, he said.
"The more time we have, the better it is for us," he said.
Bill Skinner, chief executive officer of VT Halter, said the offshore cutter program is "important for us." VT Halter employs about 1,800 at shipyards in Moss Point, Pascagoula and Escatawpa.
"We're extremely excited," Skinner said. "We'd like to see the request for proposal get out so we can get down to the competition."
Halter's neighbor in Pascagoula, Ingalls Shipyard, is already part of the Coast Guard's Deepwater Program. Ingalls has built three national security cutters, the largest ship in the program, and has contracts to build two more. The Coast Guard plans to build three more beyond those five, but no contracts have been executed.
Ingalls is the second- largest shipyard in America, with more than 10,000 employees. Spokesman Bill Glenn said the company is interested in adding the offshore cutters to its Coast Guard catalog. "Ingalls Shipbuilding looks forward to better understanding the Coast Guard requirements and competing for the platform," he said in a written statement.
Signal International is headquartered in Mobile and has ship repair and building operations in Mobile, Pascagoula and Orange, Texas.
Signal Chief Executive Officer Dick Marler said the company is "monitoring" the offshore cutter program.