BIW’s last multi-year contract was awarded in September 2018. BIW was award $3.9 billion to build four Arleigh Burkes from 2019 through 2022, according to BIW Spokesman David Hench. Huntington Ingalls received $5.1 billion for six Arleigh Burkes. “There’s no guarantee over the course of five years how that work will flow, but it’s deductive reasoning to say about half of the ships will end up at each yard,” Golden said. “Statistically speaking, it would be very difficult for one yard to take on all that work. They wouldn’t be fast enough to keep up with the rate at which the Navy is procuring them.” If the Navy awards ship contracts about the same way, Golden said the consistent and planned work would allow BIW to continue hiring new employees and stay focus on the ships currently under construction instead of wondering whether the company will get enough work to feed its growing workforce.
The Bath shipyard currently has no contracted work beyond the current contract, which ends next year. Because of this, Golden said his amendment is “a big win” for Bath Iron Works because it will likely bring business to the shipyard. “There had been indications from the Navy that they’re interested in this, but they need approval by Congress,” Golden said. “Some people were of the impression that there may be time to do this next year, but getting it done now sends the right signal to shipyards and should smooth the transition from the end of this multi-year procurement to a new one in the next fiscal year.”
BIW and its rival, Mississippi-based Huntington Ingalls, are the only two shipyards in the country that build Arleigh Burkes and the Navy typically splits the number of ships in multi-year contracts about evenly between the two, according to Golden. The National Defense Authorization Act an annual legislation directing how federal funds are used by the Defense Department. It authorizes a certain amount of funding for military hardware, including ships for the Navy, but doesn’t determine what companies should get those contracts.
The shipyard is on a hiring streak to both help reverse production delays inflicted by the COVID-19 pandemic and a strike last summer that removed over half of its machinists from the workforce for over two months and help replace retiring workers. BIW hopes to hire 2,700 employees by the end of this year and have 6,000 manufacturing employees in its arsenal, according to the company. The shipyard hired and trained nearly 1,800 employees in 2019 and added about 1,000 more last year, bringing the shipyard’s total workforce to roughly 7,400 as of Thursday. “I think having that ability to look out five years makes it a lot easier for the yard and union to work together and see how many people they need to hire,” said Golden. “It gives a lot of confidence to those younger shipbuilders coming through the gates to know they have a stable future as they think about the next five years.”
That foresight is especially important when it takes five to seven years to train a shipbuilder. Because of this, the shipyard can’t lay off shipbuilders when there’s a lull in business and expect them to return, ready to work when they’re needed again. “Absent a multi-year procurement, Congress would still be weighing whether or not to authorize the purchase of (Arleigh Burkes), but there would be less certainty,” said Golden. “If there was no multi-year contract, BIW would have to wonder every year how many might we expect next year. This way, they’re going to be able to look five years out and know about half of those ships are likely to end up here.”
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