Home » Budget Industry » Newport News Would Save $1.6 Billion, Maintain Stable Workforce of 25,000 Under 2 Proposed Carrier Buy

Newport News Would Save $1.6 Billion, Maintain Stable Workforce of 25,000 Under 2 Proposed Carrier Buy

Newport News Shipbuilding cut a 35-ton steel plate to kick off advance construction of the aircraft carrier Enterprise (CVN 80) on Aug. 24, 2017. Ship’s sponsors and U.S. Olympic gold medalists Simone Biles (left) and Katie Ledecky (center), along with Newport News Shipbuilding President Jennifer Boykin (right), signed the steel that will become part of Enterprise’s foundation. Newport News Shipbuilding photo.

NATIONAL HARBOR, Md. — If the Navy decides to buy aircraft carriers CVN-80 and 81 together, Newport News Shipbuilding will be able to maintain a steady workload that supports between 23,000 and 25,000 workers at the Virginia yard for the next decade or so, the shipyard president told reporters last week.

Part of the appeal of buying the two carriers together is that the Navy would also buy them a bit closer together: the ships would be centered about three-and-a-half or four years apart, instead of the five-year centers for recent carrier acquisition, Newport News Shipbuilding President Jennifer Boykin told reporters.

Boykin said the closer ship construction centers would allow her to avoid a “labor valley” where the workforce levels would dip down after one ship and then have to come back up, which is disruptive for employees and costly for the company.

If this two-carrier buy goes through, the company would avoid the labor valley altogether and ensure stability in its workforce, Boykin said in a company media briefing at the Navy League’s Sea Air Space 2018 symposium. That workforce stability contributes to an expected $1.6 billion in savings on the two-carrier buy from Newport News Shipbuilding’s portion of the work alone, not including government-furnished equipment.

Ongoing construction of the aircraft carrier John F Kennedy (CVN-79). Newport News Shipbuilding photo

The yard’s workforce is about 22,000 now, with the company hiring more than 400 new employees a month. That pace of hiring will drop in August, when the workforce will hit about 23,000, she said, and new hires will just be needed to cover attrition. In the coming years, the yard will grow to about 25,000 employees – will support the construction of the two carriers, two or three Virginia-class attack submarines a year and the Columbia-class ballistic-missile submarine, as well as ongoing Refueling and Complex Overhaul work on the in-service carriers and additional fleet support work maintaining carriers and subs.

Boykin said there are no major decreases in the workforce planned for the next decade or beyond, with the Navy’s ramp-up into a 355-ship fleet and insufficient repair capacity at public shipyards providing significant and stable work for the company.

Boykin said four main things contribute to the expected $1.6 billion in savings from the two-carrier buy. First, “if you don’t have the workforce valley, there’s a labor efficiency that represents savings.”

Second, “if you buy two at once, my engineering team doesn’t have to produce two technical baselines, two sets of technical products; they only have to produce one, and the applicability is to both, so there’s savings there. When we come through the planning, the build plan of how we plan to build the ship, the planning organization only has to put out one plan and the applicability is to both, so there’s savings there.”

Rendering of the third ship in the Ford class of aircraft carriers, Enterprise (CVN-80).

The third savings is a value of money over time issue, she said, and fourth is economic order quantity savings throughout the entire supply chain.

Overall, she said, the two-carrier buy “significantly increases the backlog of work that we have, it provides work and stability into the year about 2032 for ships that will serve the Navy until about 2082. The opportunity for cost savings is really based on that stability, and we know that not just for our workload stability but for many if not the majority of our suppliers. The stability for our whole industrial base is critical as we kind of lead the way forward to help the Navy build the larger and more capable navy the nation needs.”

Navy acquisition chief James Geurts told reporters after a hearing on Thursday that about a third of the cost of a carrier comes from government-furnished equipment that the Navy would contract for separately, and the service is working with its contractors to understand the potential for savings on that part of the overall carrier contract cost. When combined with the shipyard’s expected $1.6-billion in savings, Geurts has previously said the savings could approach $2.5 billion.

  • PolicyWonk

    While its great NN gets to save $1.6B – what benefit does the taxpayer get? What’s that number?

    And what’s the plan for fixing EMALS, and the arresting gear, etc? EMALS should at least be redesigned to ensure there isn’t a single point of failure for the entire system as it is now… The USS Ford, like the so-called “littoral combat ship” had a lot of new ideas/technologies that came with a lot of risk, and now we’ve got a fine fleet of brand-spankin’ new, obnoxiously expensive, yet undeployable, pier-queens.

    • NavySubNuke

      The $1.6B is the savings to the taxpayer.
      The Virginia class submarine program is the model for this effort. By buying the ships in bulk the Navy actually gets 10 Virginia’s for the price of 9 because the shipyard can coordinate all of it’s material buys, steady out it’s work force, and spread the overhead cost of all of those employees over a 5 year 10 ship hull buy rather than treating each individual hull as its own expense and front loading all the overhead onto it.

      • PolicyWonk

        Hmmm. I would’ve hoped we’d be able to do better than that. But there is a big difference – the Virginia’s are outstanding weapons: well designed; lots of room for growth; and the guys that man ’em genuinely *like* them.

        The USS Ford, OTOH, can only be described as a mess. When the USN publicly contemplates bringing a carrier out of mothballs to serve in the interim while they try to figure out how to fix all the problems – especially given what that costs – we’re talking about serious issues. All we have now with the Ford, is a nuclear powered LHA.

        • NavySubNuke

          The Ford program’s issues, which really are overblown, don’t have anything to do the terrible idea of bringing the sh*tty hawk (as those unfortunate to serve on her near the end of her life called her). It is all about getting the navy back to 12 carriers faster. The Navy being less than 12 carriers is a product of the Bush and Obama admins not prioritizing the Navy.

          • johnbull

            Every new ship class has growing pains as does the Ford. That’s why they figure on a couple of years to train and work out the kinks before the first deployment. In all likelihood even if congress gave the go ahead to recommission the Kitty Hawk tomorrow, the Ford would be on its first deployment before the old boat was ready. And what would you have- a 55 year old hull that has cost a fortune to make operational.

          • NavySubNuke

            Just imagine the cost of standing up a completely unique school house just try and train up a qualified crew to maintain the steam plant….

          • PolicyWonk

            Well, two very expensive, and grossly mismanaged wars will do that to you (in the case with GWB), and I lived to regret voting for him.

            With BHO, he not only inherited the two grossly mismanaged wars, but the worst economic disaster since the Great Depression as well, let alone the banking crisis, and a host of other horrors. And, according to the JCS Report on Force Readiness (Spring 2009), our military was already at its lowest state of readiness since Vietnam (added bonus!).

            Hence – our military was *trashed* before Obama was sworn in.

            People love to dump on Obama – and love pretending everything was going just ducky until he showed up. But he easily inherited the ugliest set of problems ever to face a POTUS upon taking the oath of any other POTUS in over a century. And the same pathetic bunch that loved making excuse after excuse for W, all of a sudden set the bar so high for acceptable executive performance, God Himself wouldn’t have made the grade.

            I therefore felt somewhat inclined to cut the guy a bit of slack – especially given that that dirtbag McConnell went on Fox to say (well before Obama was even sworn in), that his mission was to see to it that Obama would be a one-term POTUS (FAIL). Disgusting pile of political detritus – imagine wanting the nation and its people to suffer the effects of the Great Recession and lousy GOP management of this nations affairs and economy – when a decent, patriotic human being would’ve wanted to see the nation do well regardless of whoever is sitting in the Bg Chair.

            Obama, like him or not, managed to leave the nation in vastly better shape than it was in when he took office.


          • NavySubNuke

            Do you keep that wall of text in a word document somewhere and just grab paragraphs here and there as necessary? I feel like you spout the same line anytime anyone dares to point out that Obama wasn’t actually a messiah who walked on water.

          • PolicyWonk

            Maybe I should – it keeps coming back 😉

            That said, I considered him reasonably mediocre. The only ones who call him messiah (with heavy sarcasm) are those who realized he found himself elected primarily because everyone was sick to death of the nation being run into the ground by the worst executive performance in a century.

            A lot of people had a lot of hope for a guy who spoke with optimism for the future, when the opposing candidate only promised more of the same, and chose Sarah Palin (poorly) for a VP.

          • D. Jones

            You think the senator from AZ should have picked Mouaz Moustafa?

          • DaSaint

            He could have picked a dozen more qualified men or women.

          • DaSaint

            You know, I had a lot of respect for McCain…until he chose Palin as his VP. What the HECK was he thinking. IMO, ‘Palin’ was the precursor of our current POTUS.

          • DaSaint

            He wasn’t. None of them are. They are ALL flawed, as humans generally are. And the rhetoric they spit out during an election season completely changes once the realities of the office sit in front of them.

            But time has a way of ‘changing’ our impressions of a President. Did so for Teddy. Did so for FDR. Made Truman seem human. Almost makes Nixon forgivable, considering present times. Carter, oh well, maybe not everybody. Reagan, from laughing to embracing. Bush I – most qualified, but didn’t do him any good. Clinton, oh for but that dress! Bush II – couldn’t spell, but was an honorable man, though no one holds him responsible for failures of 9/11. Obama – don’t mind the depression, er, recession, he should walk on water. Trump, THAT story will be well written.

          • D. Jones

            Who got the ISIS machine up & running? Who instigated the ensuing invasion of Europe by fighting-age male “refugees”? Not W (who had faults of his own).

          • El_Sid

            Ed Miliband played a big part in the spread of ISIS – as Opposition leader he led a successful revolt in the British Parliament that meant the UK wouldn’t take part in any action in Syria in 2013. With the rest of Europe looking equally unenthusiastic despite the prospect of an influx of refugees in their back door, it would have been hard for Obama to go it alone – heck, even in Vietnam you had the support of the Aussies, and I”m not sure “the world thinks it’s a worse idea than Vietnam” is something that’s going to sell to the US public.

            The US President is not quite as all-powerful as some people make out.

          • muzzleloader

            Better shape,lol. I had great retort written, but Sam Lagrone can be very squeamish.

          • SDW

            As I read your post I found much to agree with. I was disappointed though because I never saw Congress mentioned, not even as co-conspirator. Examining any president’s term in office has to consider whether he was supported or tied up by Congress. I remember when Congress made decisions in the form of laws, budgets, and advice and consent regarding the courts and foreign policy (mostly) for the good of the country–not just points for political parties.

            Somewhere along the line they discovered that the voters didn’t care enough to pay attention and by not leading they can guarantee that things will always be so bad that they will never run out opportunities for short term advantage by non-stop negativity and other forms of sabotage.

      • Ser Arthur Dayne

        NSN, I agree with you 100% except — while the Virginia-class is often (read: always) cited as a model program and example of money well spent, savings in bulk and a proper program / aquisition example etc…. please do not forget (as about every single person always does) that the real reason it was such a financial success is because beaucoup $$$ were spent on the Seawolf-class , of which a significant amount of technology, design, equipment, etc. was used for the SSN-774s. I haven’t a problem with this, I like them, I am just saying. Seawolf was cancelled because it was so expensive, then we went to a smaller, less capable Virginia. If we had a fleet full of Seawolfs now, we’d still have saved money as the program progressed, but we’d have 15 of the absolute best naval weapons on the planet rather than just 3. All I’m sayin. Not disagreeing with you. Just pointing out how no one takes into account the “sunken costs of Seawolf” when promoting the Virginia.

        • NavySubNuke

          Certainly Virginia’s early success was due in large part to SEAWOLF – never stated or even meant to imply otherwise.
          But that doesn’t detract from the production success of Virginia, especially the multi-year block buys the Navy continues to sign for the later Virginia’s.

          • USNVO

            Yeah, it is amazing what happens when the Navy tells GD/HII that if they don’t get the cost down to what was promised in the first place there will be no two per year construction.

        • USNVO

          The only people who see the Virginia as a model program is because they have made so many. No one remembers what a disaster it was in the beginning. The Virginia was as expensive as the Seawolf and the Navy actually could have bought more Seawolfs than Virginias for the first few of the class. Start with a big enough price over run in the beginning and the later ships start looking cheap.

  • Ed L

    My Brother and his work mates would be really happy with that deal. Plus the money from their earnings that will benefit the almost 2 million people in the Virginia Beach–Norfolk–Newport News, VA area.

  • NavySubNuke

    Shipyards can’t base the pricing of their ships on hope – they can’t price CVN-80 on the hope that the Navy will buy CVN-81 so all the material they buy, all the workers they hire, all the overhead that comes with supporting those workers has to go onto CVN-80 alone. And then when the Navy does come and buy -81 they have to once again go out and do all the material buying, resize the work force to support completing 80 and building -81, and then adding in all that extra overhead costs to 81.
    If you want to see the benefits of multi-ship contracts check out the Virginia class submarine – we basically get the 10th submarine of each block “free” based on the savings of buying all 10 in a single block.

  • robert richard

    I’ll save the US Navy a lot of money. Don’t buy what you don’t need. You do have aircraft that match what you want to build. You have no aircraft that need that size ship (A-3s & A-5s created a need for super carriers- we don’t fly them any more). Then there’s the problem of a >40 aircraft air wing – so are you guys going to rent out all that extra space – there’s at least 150 feet of flight deck you don’t need… oh wait you don’t have enough berthing space maybe you can pitch tents on the roof & sleep under the stars.
    Don’t get me started on subs.

    • PolicyWonk

      Our CVN’s now deploy with about 50 aircraft, when they have space to support 80. So there is a lot of wasted real estate (currently).

      • Ser Arthur Dayne

        I agree with you, which sort of lends itself to the idea I was on about a week or two ago… we should make America-class hull CVNLs with cats and traps and ~20-25 aircraft compliments…. I realize completely that this is not going to happen. That doesn’t mean it’s not a good idea or even a better idea (10-12 CVNLs operating across the planet with a much better cost-benefit analysis ratio than 3-4 Ford-class $$$ monstrosities) but just a fun idea I guess.

        • Sir Bateman

          I’m admittedly no naval architect, but if you use an America class amphib as the basis for a new CATOBAR carrier you’re very quickly going to end up with a carrier that bears little to no resemblance to the former and a price tag that is going to absolutely skyrocket. If you’re looking for a substantially cheaper alternative to a full size nuke carrier the most cost effective and practical solution would be for some sort America class amphib set up strictly for STOVL operations.

          • D. Jones

            Deploying 50 aircraft on a 90 aircraft capable ship yields benefits many can’t see. Aside from the obvious ability to upsize when needed, it becomes a less-crowded (safer) ship that maybe doesn’t need folded-wing storage (are the Ford-class equipped with oversize elevators?). How much $ & weight & reliability & development & testing would the Navy have saved if the F35C didn’t need folding wings? How many extra unmanned (read: expendable) tankers can a Ford carry? How much bigger can they be with a Ford vs. smaller carrier?

            Don’t forget while our bean counters get excited over shaving down things to “just enough” the PRC is going in the opposite (bigger is better) direction.

            If we cut out the expenses of DC overhead & payola, we could easily fund dozens extra Fords, Virginias, Columbias, updated F22’s (or whatever the next development version is) AND Seawolves. All this plus retention bonuses for all skilled services (merit based only!)

            Also don’t count out the PRC strategically poaching people and companies critical to national defense.

            A “mini-Ford” would be a colossal debacle in terms of development time & money. Fix the EMALFS and build em.

          • Sir Bateman

            You and I are in agreement.

          • Secundius

            Reason the Aircraft Elevators are Oversize is to accommodated CH-53K’s which Tip the Scales approaching 85,000-pounds…

        • El_Sid

          1) Nuclear is expensive for smaller ships not doing the miles that eg CRUDES do.

          2) You get far less sortie generation from a 20-plane carrier, particularly one confined to Panamax dimensions like LHA-6. The numbers kinda work for a Queen Elizabeth because it’s that much bigger and has been designed to maximise sortie generation (things like having enough parking area that you’re not continually moving planes around the deck just to keep them out of the way of flight ops).

        • Secundius

          Maybe “IF” the “America’s” were the Size of a “Midway” class. But at ~844-feet in length, the only Comfortable “Cat and Traps” are going to be “Piston or Turboprop Driven” Aircraft’s…

          • Ser Arthur Dayne

            Of Course I Was Not Suggesting That My CVNL Idea Was Required To Be Identical To The America-class LHA; Therefore, It Is Reasonable To Conclude That The Exact Dimensions Required Could Be Adjusted By Professional Dimension Adjusters With The Requisite Skills & Knowledge. Thank You For Your Anticipated Understanding In This Matter.

          • Secundius

            Why have a Light (Nuclear-Powered) America class at all. The “America’s” have a range of nearly 9,500smi. at ~20kts…

      • Ed L

        Actually the Nimitz class Used to carry almost 90 aircraft 6 helicopters 4 E2, 2 COD 24 tomcats, 24 A-7, 24 A-6. But with the the CVN’s only carrying 60 or less aircraft. Then that will make room with a couple dozen VLS

      • El_Sid

        One man’s wasted real estate is another man’s surge capacity. Carriers are expensive and slow to build, whereas it’s relatively easy to surge production of aircraft (soon a F-35 will be coming off the production line every 5 days) and even easier to move some from another area of operations. So there’s not much point in putting aircraft to sea if there’s no real need for them to be deployed, but you will be corroding them, reducing the life of weapons and so on.

        So a peacetime complement of 50 aircraft doesn’t really tell you much about the real requirement if things go hot.

        • PolicyWonk

          Point taken: and I’m a firm believer in strong fences make for peaceful neighborhood. I don’t mind our CVN’s chugging around with a smaller compliment of aircraft if/when it makes sense.

          But this is also why I think we need to build CVL’s, or perhaps more LHA-6 class ships that can easily be equipped with a larger force of F-35B’s, and maybe some V-22’s set up for AEW and/or airborne refueling, to patrol less volatile parts of the world (this allows the CVN’s to patrol the more “interesting” regions.

          • El_Sid

            Well, effectively there’s two Queen Elizabeths joining the team shortly, although I’m not sure I’d classify a first deployment slotting into the Gulf rotation of US CVNs as *un*interesting!!!

            I thought it was notable that the recent light carrier study paid no attention to NATO’s newest carriers, the options below Ford size were a nuclear Midway and an America. One wonders what they were afraid of if they did include a QEC…

    • Western

      You need the extra room for F-35 spare parts and relief supplies for Puerto Rico.

  • Zorcon, Fidei Defensor

    I cannot help but think carriers are the battleships of yesteryear. In fact, I am not convinced a new generation of battleships is not warranted. A class of highly armored missile/artillery platforms with significant anti-torpedo capability… Carriers, for all their strengths are huge targets…

    Bigger is not always better?

  • Secundius

    The US/Royal Colonial Oldest Shipyard, 1 November 1767…

  • Steamroller00008

    A second Ford class carrier sooner rather than later will be a total budget buster. Take a look at the total new shipbuilding budget projected out 30 years, and you’ll see the HUGE MOUNTAIN of costs imposed by the Columbia Class SSBN’s (nothing new about this). But then check out the 2036-2040 period, and the total cost hits a big valley. So the right way forward is to keep the CVN’s at approx. 11 ships (not 12) and to double up a buy in 2036-2038. Then (at the projected rate) the 12 CVN’s Carrier Admirals & congress want can still be hit in the 2050’s

    A block buy of carriers during this fiscal valley would make the plan more affordable. The Congressional Republicans have already given away the farm to Billionaire corporate donors, so we’re already talking $ Trillion budget deficits and a lack of any extra NN funding in the short & middle-term years. I’m all for maintaining the industrial base and using economic savings such as block buys. But HI’s hiring for increased Carrier production sooner rather than later stinks of corporate manipulation, lobbying, and campaign donations corruption. The budget hawks pushing most for a 12 carrier force ASAP are the same congressmen/senators those districts will benefit most from the windfall.

    The congress “Tax Reformers” have already decided that tax cuts for Billionaires trump funds for the NN. VERY painful priorities need to be set. SSBN’S & SSN’s should be top priorites. Maintaining readiness and training should also be at the top. Providing adequate (stealthy) surface ships should be next. But adding and maintaining an additional CBG in the 2020’s is fiscally unsupportable.

  • airider

    Buy two but only pay the front office costs once. “Save” $1.6B. Everybody slap each other on the back for a job well done and then go about business as usual.

    First thing that needs to happen with this class is the design needs to get firmed up and proven. Then block buy makes sense.

    • SDW

      Budget bulimia isn’t healthy for anyone. If you are going to buy two of something then order and build them both. Economically, this is always the winning strategy. BUT

      1. You have to know what you are building. Is the Ford class design sufficiently mature? (Folks! We’re talking about numbers 4 and 5!)

      2. Once you set it up this way you can’t screw around with the funding profile/schedule. Can Congress avoid the urge to muck around with this much money? Will the pentagon strategy last for at least 5 years?

      3. Once the first pitch is thrown, whistle is blown, or (pick your favorite analogy) you can’t change the rules. We never got a real budget this year, only an inflated spending bill. Who is to say that the Executive and Legislative branches won’t come up with another mutual suicide pact like sequestration?

      4. Will the US Navy end up like the young couple that spends all its money on a down payment and have to sleep on the floor for lack of furniture? Will we have two carriers but no aircraft to fly from them or crew to sail them?

      Personally, I think the carriers are needed have my doubts about the 4 items I’ve listed.