17 April 2024
US Navy secretary tells senate committee shipbuilders need to invest more
by Michael Fabey
HII has made capital expenditure investments at its shipyards, including Newport News Shipbuilding, shown here. (Janes/Michael Fabey)
US shipbuilders should invest more money in their facilities to help the US Navy (USN) meet fleet requirements, USN Secretary Carlos Del Toro testified on 16 April to the Senate Appropriations Committee (SAC).
“Shipyards are not making enough of a contribution,” Del Toro testified during the SAC hearing on navy posture, pointing out that while the USN has invested billions in shipbuilding plans, shipbuilders have been using money to buy back stock in their own companies.
“We need them to invest in their own shipyards,” Del Toro said.
Senator Jon Tester, chairman of the SAC defence subcommittee, also blasted shipyards during the hearing for “buying back stock before investing in their shipyards”.
Del Toro previously had commented on the need for shipyards to invest more in their own facilities, but shipyard officials for HII and other major yards have publicly noted capital expenditure (CAPEX) funding in their facilities in recent years.
“HII's CAPEX funding is over USD1.5 billion for the two shipbuilding yards, from 2019 to 2023,” HII noted to Janes after the SAC hearing.
During a 4 April media roundtable, HII president and CEO Chris Kastner said, “From a capital standpoint, we've spent USD3 billion since 2015.”
To expand its footprint for aircraft carrier construction – freeing up more space for building submarines in its Newport News Shipbuilding facility – HII expanded to another city in Virginia.
Other major US shipbuilders have also revamped or expanded for USN work. Fincantieri Marinette Marine (FMM) overhauled its Wisconsin facility for guided-missile frigate construction and Austal USA retooled its Alabama yard to build steel ships after building aluminium littoral combat ships.
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US shipbuilders should invest more money in their facilities to help the US Navy (USN) meet fleet re...
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