By Geoff Fein
While builders and parts suppliers for the Navy’s Virginia-class submarine program are feeling a bit more optimistic these days following the December signing of the Block III contract for eight more boats, one executive warned it is not time for the industrial base to step back from its efforts.
“I feel very optimistic and confident about the status of the Virginia-class program. We have the signed contract. However, I don’t think it’s time to be complacent,” John Casey, president of General Dynamics [GD] Electric Boat, told Defense Daily last week.
General Dynamics and Northrop Grumman [NOC] both build Virginia-class submarines in a unique teaming arrangement.
Northrop Grumman’s Mike Petters, president of the company’s shipbuilding sector, said the submarine program is a classic case of how to get a program right.
“We started out with [asking] what is the real requirement for this program, and we settled that very early,” he told Defense Daily last week. “The next thing we settled was what is the business arrangement going to be for this program. So we created the teaming agreement between Northrop Grumman and General Dynamics, and we worked our way through that.”
Once the requirements and the business arrangement were settled, attention could be turned to programmatics, Petters said.
Once the program matured to the point that you could tell the taxpayers that this is what it takes to provide this capability, the taxpayers said ‘okay we want it.’ What you are seeing today, it’s a reminder that you have to go and remind people about that everyday. But it’s also a sense of–we have come a long way in the last 15 years.”
Members of the Submarine Industrial Base Council made their annual pilgrimage last week to Capitol Hill to press for continued funding of the Navy program and to help educate lawmakers unfamiliar with the submarines.
“Certainly there are going to be a lot of challenges with the budget…a lot of questions asked on any significant line item and this bill is a significant line item,” Casey said. “But I think we enjoy bipartisan support, primarily because of the mission platform it does fill and can fill, in addition to the fact it has a huge impact on the economy. In my mind it would be a crazy move to stifle this program.”
In addition the the new contract for eight more submarines, the Navy will also begin building two submarines a year, beginning in FY ’11, a move that many suppliers have pushed long and hard for.
Casey said moving to two submarines a year is essential.
“It’s been an objective…a goal of the submarine industrial base for a long time,” he said. “It’s been very, very difficult to achieve that goal.
But this past year, Congress found the wisdom in that argument and actually appropriated funding that began the process of buying long-lead materials, Casey said. Congress also budgeted to allow submarine builders to order materials in economic order quantities across all eight ships in Block III.
It’s essential for us to continue to retain the stability of the industrial base across the country, he added.
Building two Virginia-class submarines a year will avoid cyclical demand, Casey said. “Delivering only one ship a year creates an unbalanced demand. We can be much more efficient and achieve our cost objectives if we are building two a year. [That’s] part of the reason that argument has prevailed.”
Almost every state has at least one supplier providing parts to the Virginia-class program. Casey said there are at least 16 states that have seen more than $100 million in submarine contracts since the beginning of the program. Another 13 states have seen at least $10 million in contracts.
“You add that up and 29 states have very significant involvement in this program,” he said. “That’s jobs, and jobs is what’s really important to the economy right now.”
Both Casey and Petters pointed out that this year’s submarine industrial day attendance was the largest either had seen to date.
Petters said the large turnout is a testament to the strength of the program. “The recognition of the real requirement, the health of the industry and the health of the partnership with the government to make this happen.
This year’s submarine suppliers gathering brought three messages to share with lawmakers, Casey said.
“Yes we have a contract for eight ships, but let’s not be complacent. Let’s keep Virginia sold, keep educating members on the performance of the program and the need for the vessels, both the economic impact of the program and requirements of the Virginia-class program. That was message number one,” he said.
The second message suppliers wanted to get out was that it is time to start funding the design development work for the Ohio-class ballistic missile submarine replacement program, Casey said. “We appear to have a great opportunity to amortize the cost of that program.”
That’s because both the United States and the United Kingdom have a need for a new strategic deterrent, he noted.
One concept that could save both the U.S. and U.K funding is the opportunity to create a missile compartment design that’s common to both countries’ ships, Casey said. “We are trying to collaborate closely under the auspices of the MoD and U.S. Department of Defense and Navy.”
The third message industry representatives carried to Washington was the need for increasing research and development funding.
“There has been somewhat of a hiatus on R&D spending. We think it’s time to start investing modestly in R&D opportunities,” Casey said. “We have small items we have addressed to various [lawmakers] to help them understand the business associated with continuing to invest in submarine technology and ship technology overall.”