Photo illustration of the Ford-class aircraft carrier, USS John F. Kennedy (CVN-79). US Navy Photo
The Navy is delaying awarding a $4 billion contract to start the second Gerald R. Ford-class nuclear carrier (CVN-78) for up to a year, according to a Friday report from Bloomberg News.
The detailed design and construction for John F. Kennedy (CVN-79) was supposed to be awarded to shipbuilder Huntington Ingalls Industries in September, according to the Bloomberg report. Read More
From the Sept. 5, 2013 GAO report:
What GAO Found:
The Navy faces technical, design, and construction challenges to completing
Gerald R. Ford (CVN 78) that have led to significant cost increases and reduced
the likelihood that a fully functional ship will be delivered on time. Read More
Mike Petters has been the chief executive officer of Huntington Ingalls Industries since the shipbuilder was spun off from Northrop Grumman in 2011. On Thursday, Petters briefed reporters in the state of the company almost 18 months after the spin-off.
It was our first full year as a public company. We spun off in 2011 from Northrop and we did that in the end of March. We really had three quarters in 2011, but last year was the first full calendar year. As a public company there are lots of things you are doing that you weren’t doing before that you do for the very first time. There are lots of things that were done by other people before you became public. And our team did a very credible job working its way through that and we’re at the point where we’re doing it again. . . . We did that in an environment where there’s more than usual uncertainty in the economy, the business environment, and politically. . . . You couldn’t go a day without hearing someone talk about the level of uncertainty in the business climate.
For businesses in that environment it was a turbulent year. Usually aerospace and defense companies tend to be a little bit insulated from that kind of discussion. But I think the Budget Control Act of 2011 put defense contractors front-and-center in that conversation in a way that we were not before. I think as the year played out you saw different companies react to that in different ways. For us the issues were to pay close attention to our own knitting. When we spun the business from Northrop Grumman we said we have five contracts that we have to negotiate. We have five ships that we have to deliver that are troubled ships. It’s going to take us a couple of years to get those ships out of the way.
I’m happy to tell you that three of those five ships have been delivered. In 2012 we delivered LPD-23 and -24. LPD-22 was delivered at the very end of 2011. We still have two ships to deliver this year, LPD-25 and LHA-6. . . . Getting those ships delivered has been our focus. . . . We have to finish those two ships and get them delivered. In that regard execution and operations have been continuing to steadily improve. On LPD-25 and LHA-6 we had quality launches last year.
