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U.S. Navy awarding more contracts to help economy

New Ships

No 19 / 7 May 2020


U.S. Navy awarding more contracts to help economy

The US. Navy said it is continuing to increase the number of new ship contract awards

to help the U.S. economy recover from the impact of coronavirus. The U.S. Navy’s head

of acquisition Mr James Geurts said the U.S. Navy is “basically 32% ahead on contract

awards” of where its planned to be at this point in 2020. He called on U.S. naval shipbuilders

to keep introducing different working techniques to allow efficiency while also

creating some resiliency during the coronavirus lockdown. The largest U.S. shipbuilders

like Huntington Ingalls and Bath Iron Works are staggering shifts and allowing liberal

holiday and teleworking without suffering much disruption so far, company executives

said. Geurts said the lessons the country’s shipbuilding sector is learning under coronavirus

may lead to changes in long-term working. “We cannot operate the way we used to

operate, which had a lot of fragility and brittleness as we are seeing right now,” he said.

Even before coronavirus hit the U.S. economy, the Navy was looking at ways to save money

on repairing ships. This spring the Navy cancelled plans for a class-wide service-life

extension project for its Arleigh Burke-class destroyers that would have added 10 years to

their planned 35-year service lives. Not keeping the Arleigh Burke longer, and saving on

their life extension upgrades, would free up money for the Navy to buy more unmanned

systems and other smaller ships to fit into plans U.S. Defence Secretary Mark Esper is

making with Navy leadership for a smaller, faster, more stealthy fleet. To that end, the

service has been working on changing how it awards ship maintenance contracts. The

Navy is working to bundle multiple ship repair contracts together to give industry a

more predictable work schedule, allowing them to plan long-term. Awarding several ship

contracts at once will allow the shipbuilder to stockpile parts and arrange work schedules

in a more efficient and rational manner, as opposed to the one-off, last-minute contracts

the Navy has traditionally awarded for ship repair.