Defense officials testify on the state of U.S. shipbuilding during a House Armed Services Committee’s seapower and projection forces subcommittee hearing in Washington, March 11, 2025. Testifying are: Brett Seidle, assistant secretary of the Navy for research, development and acquisition; Eric Labs, senior analyst for naval forces and weapons of Congressional Budget Office; Shelby Oakley, director of contracting and national security acquisitions for Government Accountability Office; and Ronald O’Rourke, naval affairs analyst for Congressional Research Service.

Transcript

I ask unanimous consent that the chair be authorized to declare a recess at any time without objection, so ordered. I ask unanimous consent that Mr. Garamendi be allowed to participate in today’s hearing after all subcommittee members have had an opportunity to ask questions. Is there an objection?

Seeing none without objection, non subcommittee members will be recognized at the appropriate time for 5 minutes. Good morning and welcome everyone to the first hearing for the Sea Power and Projection Forces Subcommittee this Congress. We have many familiar faces on the subcommittee as well as some new ones. I look forward to working with everyone to address pressing national security issues within our jurisdiction. Perhaps the biggest issue is the one we’re discussing today, which is our struggles with designing and building ships. The United States is a maritime nation. And we cannot fulfill our historical role in the maritime domain without our surface surface ship and submarine fleet. Unfortunately, China and our peer competitors have also studied Mayhan’s work. They show the value of maritime strength and have made significant leaps in the size of their commercial fleet as well as their naval strength. If we expect to deter or defeat any peer adversary, we must maintain America’s command of the world’s oceans. We have a requirement for 381 ships based on the most recent battle force ship assessment and requirement report of 2023. Unfortunately, the most recent 30 year shipbuilding plan lays on a path where we wouldn’t meet that mark until 2050. That plan also makes assumptions on procurement costs and the rate of ship delivery that may no longer be viable. The results of last year’s 45 day shipbuilding review showed many programs were significantly behind schedule. Some of the expected delays are alarming. For example, delivery of the constellation class frigate is expected to be delayed for 3 years. However, it is unclear what lessons we have learned from that review, and President Trump is right to order another. These problems are why I’m so excited about the president’s plan to stand up a dedicated shipbuilding office in the White House. This is a critical step towards ensuring that shipbuilding remains a national priority and that we take a whole of government approach to strengthening our industrial base. Interaction is not an option because our shipbuilding struggles are more than just scheduled delays. Our witnesses from GAO and CBO have published several reports detailing severe cost overruns and extreme increases in unit costs for many programs. If this trend continues, we may not be able to recapitalize our fleet without sacrificing other budget priorities to address these challenges, we need more than just small adjustments. We need a bold and comprehensive commitment to rebuilding our shipbuilding industrial base. That is why I introduced the bipartisan Ships Act in the 118th Congress and I’m working to reintroduce it this Congress. Investments in modernizing shipyards, strengthening workforce development, and stabilizing supply chains as outlined in the Ships Act will be a key to ensuring that we can sustain a modern capable navy while reducing dependence on foreign suppliers. It will also create thousands of good paying American jobs. Strengthen communities to say this plainly, we must act now whether through changes to our procurement processes, stronger industrial based investments, or cultural shifts within shipbuilding program offices, we need to make these decisions sooner rather than later. I look forward to having a frank conversation today and hope that we’ll be able to examine our current problem through real transparency. Thank you to our witnesses for your participation at the hearing. And I look forward to your testimony. I now recognize the ranking member Joe Courtney, my friend, for an opening statement. Thank you, uh, Mr. Chairman, and, um, uh, again, to our witnesses, uh, you know this is obviously our lead off, um, hearing which obviously I think speaks volumes about the priority that the subcommittee. Uh, gives to this issue and actually the Armed Services Committee, uh, as a whole, Article One, Section 8 Clause 13, uh, states, uh, Congress shall provide and maintain the navy, not the president, not the Navy, um, so obviously the, um, opportunity and, um, uh, mandate for us to to move forward really rests with uh the Article One, branch of government and again I agree with, uh. Uh, Mr. Kelly’s, uh, sort of strategic, uh, description of what we’re looking at, um, in terms of the need for strengthening the sea services and expanding, uh, the fleet size, um, whether it’s Indo Paycom, Europe, Northern Command Southern Command, you know, Central command, it’s, you know, the, the, the the combatant commander’s demand for. Uh, navy ships, uh, and Coast Guard ships for that matter, uh, outstrips obviously the, the size of the fleet, and we have to do everything we can to, to expand capacity and accelerate, uh, production cadence, uh, to meet the moment that’s there. I have a statement which I’m not gonna read all the way through because again we have lots of testimony to hear and I wanna give also members an opportunity but I would just note a couple of things reviewing your testimony. Which is that this subcommittee has not been a bystander over the last 10 years in terms of real meaningful changes that are happening uh and helping in terms of, uh, you know, cost effectiveness and efficiency in the ship building process, um, the National Sea based deterrence fund which, uh, again is on the books. Um, created multi-year authorities for the construction of the Columbia class submarine and again we have the numbers which shows the savings, uh, that that multi-year process has actually generated and, and again the feedback whether. It’s from the shipyards or the supply chain um have emphasized over and over again how valuable um that change in terms of the procurement process has has been in terms of, you know, getting what the navy describes as the most important acquisition program, uh, in their portfolio, uh, recapitalizing our ballistic submarine fleet. Um, number 2, the submarine industrial base funding which, uh, started in 2018 again originated on this subcommittee, a recognition, uh, by a lot of us who represent, um, shipyards that investing in workforce supply chain and facility. Um, had to be basically increased outside of just the regular procurement line items. Uh, the first year we did it in 2018 with, uh, Jim Lanjaman, it was a $20 million plus up. To the Navy’s budget it was actually some resistance within the Navy in terms of doing that, but now we’re $6 billion into this enterprise, uh, which again has had extremely strong bipartisan, uh, results and again I think that whether it’s down in Alabama where the strategic outsourcing is happening at Austal Shipyard, uh, now, uh, Philadelphia Shipyard is gonna be, um, again part of this, uh, process in terms of large. Metal fabrication to again take man hours out of New England and Virginia. I mean it’s, it’s starting to to pay, uh, real, uh, dividends. Lastly, the, the vessel construction manager, uh, at MayAD in terms of the, uh, maritime training ships which again the Sea Power subcommittee gave the authority, uh, to MayorAD to go outside the normal Navy procurement process and uh I’ll provide a uh private sector. Model in terms of the contract design and execution, uh, if anybody goes up there and Mr. Norcross is right across the river from it, um, you’ll see that those 6 600 ft plus ships are, uh, being delivered on time within that contract structure, um, and frankly we need to and then Mr. Sydell and I had a talk about this in the office the other day, you know, those are the kind of tools that we need to implement in terms of getting. Uh, as the president said, you know, faster and bigger, um, and, and, and, and again we can, we can sort of be a big partner, uh, in terms of, uh, uh, producing that. So my last sort of concern is and I’m hearing this, I had a supply chain event up in Hartford yesterday. The tariff impact in terms of steel prices and other commodities that go into shipbuilding is being impacted. I mean that is just the, the rolled steel increase since January is like 26%, uh, in terms of just what, what, um, vendors are, are seeing out there and I think frankly, you know, that’s part of this issue which is that when we’re talking about cost overruns and the GAO report goes into it in chapter and verse. Um, you know, we’ve gotta, you know, think holistically here in terms of just this is not just uh an NDAA issue. This is there’s large, um, you know, policy issues that, um, that even tariffs are gonna impact. Uh, whether or not we can build, um, steel ships with nickel alloy coming from Canada, I mean, it’s just that’s, that’s just the reality that’s there, you know, we gotta, everybody’s gotta be, you know, they’re head on a swivel in terms of really looking around and making sure that we’re making good and smart choices again, the Office of Shipbuilding which the White House is set up. Manned by Ian Bennett, Mr. Kelly’s, uh, staffer, I, I think is a very encouraging, um, sign. We’re very excited and we’re hoping that the SAS initiative which faltered, um, at the end of last the last administration, is something that again people are gonna take another fresh look at if we want to accelerate and expand the size of, uh. Of shipping, that’s probably a longer statement than my written statement. I apologize to the members that are there, uh, but again, it, it, I think there’s a lot of passion and interest in this issue, and again, um, we got a great panel here today to explore that and without a yield back. Mr. Courtney and I, neither one ever talked very long. That that highlights the importance of this hearing that we felt the need to talk that long about this very important thing. I first recognized for 5 minutes. Doctor Brett Seidle, uh, who serves as the principal civilian deputy to the assistant secretary of the Navy for Research Development and acquisition, he is currently acting as the assistant secretary of the Navy for RDNA. Prior to his service within the Department of the Navy, he had an extensive private sector career in automotive manufacturing. Doctor Sottle, uh, you were recognized for 5 minutes. Thank you. Chairman Kelly, ranking member Courtney and distinguished members of this subcommittee, good morning. Thank you for the opportunity to appear before you today to address the state of US shipbuilding. Prior to assuming duties in January as acting assistant secretary of the Navy for research, development and acquisition, I spent almost half my career in the private sector running manufacturing organizations before leading change in our naval research and development establishment for the past 20 years. I also spent time leading our nation’s public shipyards as the acting executive director of NAVCO4. I’d also like to welcome my esteemed co-witnesses, Doctor Eric Labs, Ms. Shelby Oakley, and Mr. Ron O’Rourke. I am very familiar with your work, uh, and respect the passion you bring to these endeavors and the impact your work has on strengthening our great navy. I believe we have much in common. As I was not raised in the shipbuilding environment and therefore not saddled with preconceived notions of this is how we’ve always done it, I certainly welcome informed perspectives from those who are passionate about strengthening our fleet. I am, however, proud of our navy on a myriad of fronts. US shipbuilders continue to produce the highest quality, safest and most advanced warships on the globe. I have taken to saying every time I speak publicly in this role that the finest navy ever assembled in the history of the world is coming to a theater near you. And they’re bringing their A game. And at a time when outstanding performance against adversaries is needed in contested maritime commons from the Red Sea to the Western Pacific, that is exactly what our navy is delivering, and I for one, am proud to be a part of those efforts. However, the US shipbuilding industry is challenged to produce the quantity of ships at the rate required for lasting effect, sustainable growth in the battle force inventory, and the Navy is challenged in providing consistent direction as the underpinning for their success. On balance, cost and scheduled performance remain challenged with deliveries approximately 1 to 3 years late and costs rising faster than overall inflation. These issues are prevalent across the nuclear and conventional shipbuilding communities with both navy and industry sharing responsibility. Some of our challenges include atrophy of the manufacturing sector, depressed investment, workforce shortages, diminished proficiency, as well as supply chain disruptions. Historic underinvestment and industry consolidation following the end of the Cold War have reduced competition and capacity at the tier one shipyards and their suppliers, leading to resource constrained scheduling that is behind our targets burdensome acquisition processes, pre-COVID contracts, and shifting navy requirements also contribute. Having said the above, I firmly believe our collective challenges can be overcome. And this committee has my passionate commitment to collaborate with Congress, industry, academia, training organizations, trade associations, as well as all levels of government in pursuit of improved cost and scheduled performance. I intend to look forward to drive change and collaborate with our industry partners in healthy ways to improve American shipbuilding. My most enduring focus will be on improving trust. Accountability and credibility with Congress and shipbuilders, which is critical to leading the type of improvement necessary for our continued success around the globe. Our nation and the world needs the strength of our navy, and my intent is to do everything in my power to deliver on that promise. I’m excited to be here today and look forward to answering your questions. I now recognize Doctor Eric Labs, who is a senior analyst for naval forces and weapons at the Congressional Budget Office. He has published many studies related to today’s topic, and his work has helped inform much of his uh, much of this subcommittee’s work. Doctor Labs, you are now recognized for 5 minutes. Chairman Kelly, Representative Courtney, members of the subcommittee, it’s a pleasure to be here today to discuss the state of US shipbuilding. Mr. Chairman, with your permission, I’d like to submit my statement for the record and summarize a few key points. First, costs for Navy shipbuilding programs have grown and are growing. Cost overruns for 46 ships the Navy has under construction grew threefold over the past budget year from $3.4 billion to $10.4 billion. The Navy’s 2025 shipbuilding program is the most expensive one to date. CBO estimates it would cost an average of $40 billion per year every year between now and 2054 to buy the 364-ish new ships in the Navy’s plan, which is 46% more than the average shipbuilding appropriation over the last five years. In addition, by 2054, the Navy’s top line would need to increase by 13 in real terms to pay for the associated costs of operating a larger fleet. The successful implementation of the Navy’s plan depends on the shipbuilding industrial base being able to recover from its current challenges over the next 15 years, and those challenges are the most severe that I have seen in the 30 years I’ve been CBO’s naval analyst. One of the reasons naval shipbuilding is challenging was that in the face of the headwinds of COVID and the decline of interest in manufacturing jobs in the United States, the shipbuilding program progressively increased the demand for naval tonnage. Between 2014 and 2024, the amount of naval tonnage under construction rose by 80% from 68,000 tons to 123,000 tons annually for combat ships, the increase was 65%. Submarine tonnage alone increased by 70%. That required a substantial increase in shipyard labor and the yards for a variety of reasons were not able to keep up. Under the 2025 plan, the growth and demand for naval tonnage would continue between now and 2034, the average amount of tonnage under construction would increase by another 45% for combat ships would grow by another 50% and remain there for 2054. In particular, submarine tonnage construction would increase by another 70% and would only abate once the Columbia class was complete. Those developments have led to lengthened construction times for ships. For example, aircraft carriers used to take 8 years to build. Now they take 11. In the 2000s, attack submarines took 6 years to build. Now they take 9. Destroyers and amphibious assault ships used to take 5 years to build. Now they also take 9 years to build. That then led to substantial cost growth. For example, tax submarines used to cost about $3 billion a few years ago. Now they cost $4.5 billion and are still growing. Destroyers used to cost $1.9 billion and now they cost $2.5 billion and only about a third of that cost growth can be attributed to shipbuilding inflation. The result of the shipbuilding delays is a fleet that is much smaller than it otherwise could have been. Between 2019 and 2040, the navy lost and will lose 234 ship service years from ships that should have been commissioned but were not. In the critical period from 2027 to 2030, the fleet will be smaller by 20 ships, mostly a loss of attack submarines and destroyers. So what can be done about it?

As this committee is well aware, CBO cannot by statute make policy recommendations. However, one way to think about this problem would be to focus on the key roadblocks to a more efficient and productive shipbuilding enterprise. In my view, nothing is more important than addressing the critical labor shortages that afflict all of the shipbuilding and public maintenance yards. For years, recruitment at the yards has been hard retention is even harder, especially in the critical trades of welders, ship fitters, and pipefitters. Many, if not all of the yards report attrition rates in the touch labor force of 20% or more in the critical trades I just mentioned, attrition is running at 30%. Any policy that improves the labor situation is worth considering from substantially increasing wages to improving benefits to helping make housing more affordable to providing tax benefits for doing this critical work, to improving the quality of life in the shipyards to increasing the use of robotics and automation. In my view, without fully addressing the challenge of labor, all other efforts will be marginal. A second consideration would be to diversify the Navy shipbuilding portfolio such that other yards could be brought into the production business with the existing yards running at capacity and more diversification of shipbuilder is also worth discussing, and that would mean considering changes to what the Navy is planning to buy. I would like to close on a note of caution. It has taken us a long time to get into this situation, and it’s going to take us a long time to get out of it. There is no silver bullet, no magical solution. It is going to take years if not decades of hard work and a lot of money to, if you’ll permit the metaphor, right the ship. Thank you Mr. Chairman, and I’m happy to respond to any questions the subcommittee might have. Thank you. I now recognize Ms. Shelby Oakley. Ms. Shelby Oakley is the director in the Government Accountability Office’s contracting and national security acquisitions teams focusing on Navy ship building and nuclear triad recapitalization. She’s a frequent witness before the Armed Service Committee, and her team’s work is invaluable to our efforts. Ms. Oakley, you are now recognized for 5 minutes. Chairman Kelly, ranking member Courtney, and members of the subcommittee, thank you for having me here today to talk about the challenges the Navy is facing with shipbuilding and getting critical capabilities out to the fleet. I will discuss the persistent outcomes we have seen over the past two decades, the causes for the outcomes, and what the Navy can do to drive systemic change with the broad support it has from Congress. The reality is we have no more ships today than we did back in 2003 when the Navy released its 1st 30 year ship building plan calling for a substantial increase in fleet size. That’s a serious problem, especially at a time when our near peer adversaries are rapidly expanding their fleets and fielding advanced technologies that could shift the balance of power away from the United States. The Navy’s issues aren’t new. For the last two decades we’ve reported that the Navy shipbuilding approach consistently leads to outcomes like cost overruns, scheduled delays, and ships that don’t provide the expected capabilities. We’ve also found that the current system isn’t setting up the Navy and private industries talented and hardworking people for success. It’s actually making their jobs harder. The Navy’s poor shipbuilding performance stems from a myriad of issues. For instance, the Navy’s budget and acquisition processes don’t use the successful approaches of commercial companies that our work has found can be thoughtfully applied to Navy shipbuilding programs. The frigate program is a prime example. The Navy failed to ensure a stable design before starting construction, a leading practice in successful commercial shipbuilding, and as a result, the lead ship is now delayed at least 3 years. And construction has stalled as the navy and shipbuilder try and figure out if the ship can even be built. Further, to secure funding, the navy often creates optimistic business cases. These business cases are frequently approved, although they don’t always reflect what is achievable with time, money, technology, or capacity available. They then subsequently unraveled during lead ship construction or even before. This requires that the navy divert resources from other priorities to shore up its existing ship building programs and delays the delivery of needed capabilities to the fleet. And it’s not just ships. The Navy has struggled to field other critical capabilities needed to maintain maritime dominance. For example, the Navy has funded work on robotic autonomous systems for over 30 years, yet it has very few fielded assets to show for it. The challenges also don’t stop with the budgeting and acquisition processes, as has been mentioned, the Navy is also dealing with private shipyards that are aging and workforce shortages that are further contributing to the negative shipbuilding outcomes. Our work has shown private industry has been reluctant to invest on its own to address these issues. The Navy and DOD have invested billions of dollars. However, the Navy doesn’t have a strategy to address these issues or credible measures to ensure that the billions of dollars in government investments that are supported by the Congress in this industrial base will actually make a difference. The bottom line, marginal change will not fix the persistently poor outcomes, and more money alone is not the solution. If the navy doesn’t look introspectively and make bold systemic changes, the consequences are only going to get worse. Technology is evolving fast and our adversaries are not waiting around for us to catch up. Our almost 60 open recommendations related to ship building can provide a path forward for the navy. For example, the Navy could establish a more agile and acquisition and budgeting processes so that programs are structured for iteration to deliver capability quickly and add capability as technology advances and threats change. They could leverage quality information that includes realistic assessment of risk to inform program cost and schedule estimates. They could develop and leverage digital tools to gain information about design feasibility earlier and better incorporate feedback from the fleet and then use this information to ensure ship designs are stable before making major commitments to buy new ships. With the navy pressing to keep pace with near peer adversaries that are growing increasingly capable, the cracks in its approach to acquisition are more pronounced than ever. If the Navy continues with business as usual, we should expect these cracks to create an increasingly stark divide between the Navy’s aspirations for a larger, more capable fleet and reality. Without change this reality could manifest as a shrinking less capable fleet which ultimately is unable to project the superior force the Navy has at its disposal today. Chairman Kelly, ranking member Courtney, and members of the subcommittee, this concludes my statement. I’m happy to answer any questions you have. Thank you. I now recognize Mr. Ronald O’Rourke. Mr. O’Rourke is a naval affairs analyst for the Congressional Research Service. He has authored many relevant articles and reports on today’s topic and conducted extensive research on ship building programs. Mr. O’Rourke, you are recognized for 5 minutes. Chairman Kelly, ranking member Courtney, distinguished members of the subcommittee, thank you for the opportunity to appear before you today. The Navy is currently facing challenges in designing ships, building ships, crewing ships, and maintaining ships. It’s the most significant combination of challenges for the Navy that I’ve seen in my 41 years at CRS. The requirements process is central to Navy ship acquisition, but it can cause ship design to grow in size and cost during the conceptual design phase, as happened with the Zumwalt destroyer. It can undermine apparent design acquisition strategy as appears to have happened with the constellation class frigate, and it can lead to design construction concurrency as happened with the litoral combat ship program. The projected delays in navy shipbuilding are quite significant and industrial base capacity constraints are present at both shipyards and supplier firms as Doctor Labs mentioned workforce challenges are a central factor. Some observers have characterized the situation as a strategic liability for the United States in competing with China. My prepared statement presents 15 options for expanding and using shipbuilding capacity. Many of them relate to the workforce. Most of them are being pursued to some degree by the navy and industry, but could be pursued more intensively or at broader scale. The Navy’s current overall approach to ship acquisition, which might be referred to as the current American naval system, includes three elements that I assess are contributing to the Navy’s challenges in designing, building, crewing, and maintaining ships first. The navy treats its force level goals for various ship types as more precise and durable than they really are and then chases those subject to change goals by continually tinkering with ship procurement profiles leading to production inefficiencies and industrial based challenges. Second, the navy is suboptimizing ship design efforts at the individual ship level instead of optimizing them at the fleet wide level. In other words. The navy is building a fleet without truly designing a fleet, leading to challenges throughout the ship design build crew and maintain life cycle from trying to manage an assemblage of individually developed bespoke ship designs. And third, the Navy is developing ship building programs without adequately taking into account the features of the US society that will be called upon to design, build, crew, and maintain those ships. A possible alternative approach for the navy, which might be referred to as a potential new American naval system could include the following five elements. First, make more comprehensive use of federated shipbuilding in which ship modules are built at facilities other than the final assembly yards so as to gain access to regional labor markets that are not significantly involved in navy shipbuilding. Second, move the navy toward a more comprehensive and systematic kit of parts approach in which standard components, uh, go into standard systems that are installed on ships with standard internal features. Third, focus ship design more on reducing the labor hours needed to build the ship following the South Korean approach to design for producibility. Fourth, move toward continuous production, which I’ll outline in a moment. And 5th employ upfront fleet design, meaning the use of a generalized fleet design framework that incorporates the four things I just mentioned and the vetting of proposed shipbuilding programs in relation to that framework. That part about continuous production which I just mentioned could include first using multi-year contracting where cost effective. Second, managing changes in ship force levels not through changes in procurement profiles but instead through end of service life decisions following Japan’s approach for its submarine force. Third, moving to condition-based minimal loss procurement transitions in ship classes and 4th characterizing the future fleet in terms of steady procurement rates, adopting what can be called a production centered or rate centered approach to the future fleet. This would be a new way to think about the future fleet and how to get there. This potential new American naval system is by no means the only option for addressing the Navy’s challenges in designing, building, crewing and maintaining ships, and it wouldn’t solve all those challenges. As Ms. Oakley mentioned, continuing the Navy’s current approach, however, is likely to lead to a continuation of these challenges. Chairman Kelly, ranking member Courtney, thank you again for the opportunity to appear before you today, and I’ll be pleased to respond to any questions the subcommittee may have. Thank all our witnesses. I now recognize myself for 5 minutes. Uh, Doctor Seidle, I’m worried about the mixed demand signals that we send uh industry with constant fluctuation in our 30 year shipbuilding plans. How can we send clear demand signals to industry so that they’re able to invest in their own workforce and technical capacity. And also a separate question, how is the Department of the Navy working on GAO’s recommendations as well as improving the culture of procurement?

Thank you, Chairman Kelly. I appreciate the question, uh, and thanks for the time last week too. Uh, I’ve had a chance to get down, um. To your neck of the woods and visit with Ingalls and see what they’re doing uh in that arena and I think it gets to the first question that is around uh how do we ensure that we keep a constant flow of product through our shipyards. I do think it’s critical and it’s not lost on me that that organization has the DDGs and the amphibs we’ve done some multi-ship procurements uh to make sure that they are staying fed well and as a result. There’s consistency in approach and, and I think certainly in the amphibs it’s one of the success stories that we have where ships are being delivered on time and on budget so uh it it strikes us to think about how we handle that holistically, uh, for the rest of our shipbuilders to make sure that that’s happening writ large, um. I think a part of it is being a little more directive in that workload. I think we do understand which yards can do which work which platforms are best suited for that, and we need to be thoughtful in doing that to keep the, the whole enterprise fed well so that they can manage their workforce, their hiring, um, and retention issues. So my commitment to you is to, to work, um, with our partners back in the Pentagon to make sure we try to do that well for you. To your point about GAO recommendations, uh, I’ve had conversations with Ms. Oakley before. Uh, I agree with, uh, much of what she has said. I think there’s real opportunity space there, um, and quite frankly I think sometimes we spend a lot of our time, uh, communicating via reports, uh, back and forth to each other as opposed to working closely together to get after it and so my commitment to her and her team. Is that we’ll lean into that and get after some of those recommendations because quite frankly they resonate with me on a lot of different fronts. And and just I wanna know, you know, we’re the greatest maritime nation in the history of the world and we’re still that and there’s no reason we can’t continue to be that, but it takes doing things not the same old way but it takes taking a hard look at ourselves and getting better. Oakley, the GAO has identified several opportunities for the Navy to modernize its practices to support timely and predictable outcomes for the constellation class frigate and other future programs. Which of your recommendations relating to design and procurement remain outstanding?

We have several recommendations both specifically directed at the frigate program and then also about the broader design approach that the Navy uses that remain open, specifically with regard to the frigate, um, we recommended that they take a look at developing the basic and functional design of the ship before beginning construction at least of the second, um, ship since the first ship is already underway, um. That remains open and we know that the navy and the builder are doing significant work now to really mature that design and it’s that key that um commercial shipbuilders follow in maturing that design so that what they know when they start bending metal, they start construction. That they’re gonna get what they expect to get when they get when they when when they are gonna get it and so those are really some of the key recommendations that we’ve made to frigate but also writ large with regard to their design performance. The other thing that I would mention is um really leveraging technology um to be able to exercise the. Design earlier on to understand the implication of changes, specs requirements that you know creep, um, and what those implications could be on the design of the ship so that that’s all worked out before you begin construction of the ship and then are in the business of doing rework and having to fix things that you realize can’t work. Thank you. And as noted, uh, I’m yielding back my time and I will hold everyone. I will adhere to the 5 minute rule today. So Mr. Courtney, you’re recognized for 5 minutes. Thank you, Mr. Chairman. Um, Mr. Labs, I wanna thank you for focusing on workforce in terms of, um, you know, the moment that we’re in right now because, uh, there’s just no question that, um. If you, uh, Matt, um, Sermon over at the Navy, uh, points to a fact that at the end of the Cold War 45, uh, 35% of the American workforce was in manufacturing, you know, you fast forward to 2025, it’s less than 15%. So you know, when you, you sort of look back at how we built 5000 ships in World War II. And we’re able to turn on the industrial base so quickly I mean again you actually had a workforce that was primed whether it was commercial ship building or auto manufacturing to, to basically, um, you know, shift into into that type of production, um, so you know clearly with the 15% uh workforce we’re a bigger country but still you know that’s that’s a a hill that we have to climb in terms of making um metal trades more attractive. Again, uh, uh, in Groton in 2023 we, they, they hired 5300 workers between Groton and Quonset Point. That’s bigger than World War Two numbers, uh, if you, if you go back historically. You know, as part of that process, uh, there was a metal trades collective bargaining agreement that was negotiated that actually gave a boost to to wages, um, over the lifetime was about 25-30% increase in pay and protected, uh, benefits as well. Um, they, they have over 80% retention, um, it, it’s, uh, you know, again, sort of defies all the conventional wisdom about the fact that, you know, people are flushing out after they’re getting hired. We, we passed wage improvement language in the submarine supplemental in December, uh, when we again gave a boost to the to the submarine account that’s there, um, the SARS, uh, proposal, the and again for some of the new members, it’s the shipyard accountability and work for supply. Uh, uh, proposal navies developed would actually turbocharge that wage improvement opportunity, and I know that’s something the White House is looking at in terms of their, um, executive order. We’ve got to make the differential between working in a shipyard in the metal trades better, significantly better than working in retail, which is what it which existed during the Cold War. So maybe you could just sort of comment on that in terms of just how you incentivize people to, uh, to go into the trades. Um, uh, thank, thank you, uh, Mr. Courtney, for that question, and, and I quite agree with pretty much everything that you have said. I, I am not an economist by training, but I work in an organization chock full of economists, and every time I have this conversation with, you know, people at my place, they said, Well, why don’t we just pay these workers more?

And I think that is the ultimately that is going to be a key part of the answer here. And you’re absolutely right, and I’ve been fortunate enough to visit various shipyards and you could see the differential. It was not that great. You could drive by a subway that would advertise $18 an hour plus benefits and the shipyards were paying $20 or $21 an hour, but shipyard work is hot, it’s cold, it’s, it’s unpleasant. So in my view, the differential between retail or even other manufacturing, uh, sectors in in the areas that surround the shipyard has got to be much, much greater than it currently is. And, and it’s not just wages so I think wages is important, especially for the entry level workers, but it’s other things improving the quality of life to doing what you can to sort of make that process in the yards easier for them, improving benefits, um, uh, of of various kinds, um, affordability of housing has become a big challenge to some of these yards. One of the things that the effects of COVID was that a lot of people in cities went to sort of buy water. Front property which is where shipyards are and because they could work remotely from there so you have places like Bath, Maine, which is expensive properties is expensive it is in Northern Virginia, a fact that when I learned up there sort of shocked me. So anything that sort of goes just down the path of increasing um the the the wages for the for the for the skilled laborers that we have in the shipyards, I think it’s something worth considering and and discussing. SAS is one mechanism to do it. It is not the only mechanism that can be done, but it is certainly, uh, I think we’re on the right path because to me when I look at where were we in the in those earlier years when we were producing ships faster and where are we now, the big issue to me is is labor and Doctor Sedell, really quick, I mean, obviously we’ve got to make this workforce, um. You know, actually be do better, um, and there’s good news. I mean they handle virtual technology and digital technology, which is no, you know, hopefully gonna help, um, improve things but again the job training, um, we gotta get that right mixture not too hot, not too cold in terms of the immersion into the, the metal trades welding electricians, and I know the Navy is definitely pushing to get that, um, that type of model through. I I apologize I guess I’m about to run out of time, so I yield back, but maybe we can. Uh, get an answer for the record later. If you can get us an answer for the record, maybe it’ll come up, uh, do you know I now recognize Mr. Whitman. Well, thank you, Mr. Chairman. I’d like to thank our witnesses. Ms. Oakley, you, uh, brought it, uh, out, I think very succinctly and clearly. Uh, the names have changed, but the song remains the same. It’s been the same for the last two decades. We know what we need to do. We just can’t seem to find a way to get it done. We see issues with workforce that’s a continuing theme. We see an issue with design maturity, design completely complete uh completeness. We see an issue with maintaining the ships that we allegedly are supposed to be building and we look at AOO operational availability to go down. I mean all these things are mind bogglingly simple yet it can’t we can’t seem to get to a place to address him and Doctor Seidel and and Mr. O’Rourke and Ms. Oakley, I want to begin with you. Give me your perspective you spoke a little bit about this. You know, we talk about workforce, yet we have a maintenance industry that has roller coaster rides for lots of ships in the yard and then the ships disappear. We lay people off with the same skills that we need in the build yards and yet we don’t seem to want to integrate those two enterprises which use the same skill sets. We also too look at uh how do we make sure that we are are getting designs complete?

We know when we go to the art like constellation class it’s gonna be 85% complete certain uncertainty goes out the door, and yet we change that and now it’s only 15% complete in design. I mean we know what it takes to successfully. Entertain and execute these enterprises, yet we keep going back to the same place. Tell me, tell me, how do we make meaningful changes that will last and that will be transformational to what needs to happen both in the ship building and ship maintenance industry because you can’t separate the two, they both have to happen the same way. Doctor Silo begin with you then go to Miss Oakley and then Mr. O’Rourke. Thank you for that question, sir, um, and I appreciate being here today to talk about this. Listen, I think, um. First, importantly, the work that this committee has done supporting us with the maritime industrial base funds previously the submarine industrial base funds is a big part of what we’re doing. We stood up the direct reporting program. Manager office for the maritime industrial base, the DDRA Mib last September, uh, this, this body has given us over $4 billion just in the last two years that gets at these issues. We are putting that money on the workforce hiring and retention issues. We’re putting it on supply chain network issues. We’re driving modernization, uh, and advanced manufacturing into the yards. You know, I, I will say this workforce piece, this, uh, atrophy of that sector in my opinion is fundamental to everything that we’re talking about. We really have to find a way. I, I often say back when I worked in the private sector, uh. We were paying $30 it was $335 minimum wage, and uh we were paying $13 an hour for manufacturing labor 3 or 4x today it’s 1.2, 1.3 X. uh, we’re trying to get after that um and I think, you know, I’ll be quick here because I know we, we want other folks to be able to talk, but just in the workforce piece we stood up build submarines. Dotcom we’ve had over 3 million hits on that since its inception led to 2.5 million applications, 9700 employees hired for the submarine industrial base in 23, a 40% improvement, another 10K in 24 real metrics, real progress. We’re gonna see that play out on the back end of this to drive production. But uh there’s goodness happening. I wanna make sure I get to Miss Oakley. Mr. O’Rourke. Oakley, I’ll be real quick. You hit the nail on the head with regard to the overlap between the repair and shipbuilding workforces and the industrial base, and that’s why our recent report on the shipbuilding and ship repair industrial base recommended that the Navy put forth a strategy for how they’re going to invest in both of these industrial bases to ensure that they’re both going to be positioned to not only deliver the ships that we need but also maintain and sustain those ships for. Our fleet and then secondly I think one important thing to note about design is that the Navy’s own design workforce in-house has significantly atrophied as well and I think that that’s part of the problem that you’re seeing with regard to reviewing the design progress and really understanding how how much uh how mature these designs are before we’re making these critical decisions and I know they’re focused on improving that as well and I think that’s a good approach. Thank you, Mr. O’Rourke. I’ll make 4 quick points. Uh, first, of the various options in my testimony, uh, the one that has the most promise for achieving results the soonest is the one that Dr. Labs has focused on, which is increasing wages. Um, second, uh, the design issue on the, uh, the frigate program is another workforce issue because. Um, once you abandoned the parent design strategy, you threw that into the hands of the ship design community to redesign the ship. Well, we have a shortage of ship designers in this country and naval architects and marine engineers, so that’s another workforce issue and again. That’s a wages issue because these are engineers that could take engineering jobs in other parts of the economy. Mr. O’Rourke, I’m, I’m, I’m, I, in, in deference to the chairman, I listen, I want to take your, your additional two suggestions for the record, Mr. Chairman, you please, if you will provide those. I now recognize the gentleman from New Jersey, Mr. Norcross. Thank you, Chairman, and the witnesses for being here today. Uh, I’m entering my second decade on this subcommittee and As Mr. Whitman just said, reoccurring issues a death by 1000 cuts. We are not talking about anything new today. Maybe outside of the labor issue that we weren’t talking about 10 years ago, it’s all there, uh. In most major yards you have commercial military some are combined, some aren’t. We have large and small ones which we see here and then you build and repair going after what uh Rob Whitman talked about. The idea that We have lost our industrial base comes down to one issue. We all short it. The commercial side is gone if it wasn’t for the Jones Act. Jones Act said we have to have that industrial base, but it has not been enough. uh, in the Philadelphia yard right across the river from my district we’ve seen where Hanway has come in looking to immediately look to double what they’re doing because they’re doing very different than the old acres yard. And then what they’re doing is looking across the river, quite frankly in my district to look at the newest and heaviest roll on roll off port with plenty of room to build what they’re talking about. But it still comes down to each of you said labor, the idea that we can attract that next generation. Is a relatively simple thing to fix. I come from the building trades. We don’t have any problem hiring electricians, you know why?

Because we pay them well. You talked about what you used to pay them and what you pay them now and then you look at the leadership of those yards, what they were paid years ago they went different ways. This is the simplest thing to fix, give the workers value that we care about what they do. And pay them the right amount of money. It really is that simple. You can get the people if you treat them well and you pay them well and diversify that workforce. So let me go down the line here starting with you, Doctor Sydell. Labor issues. Do you agree with the wage issues being number one?

If not, please tell me what the number one issue with labor is. Thank you sir. I know, I absolutely believe that the labor issue is the number one, and if you just think about what it means if you took the extreme case and we were paying 3 or 4X, people would actually show up in droves to work in this environment. It’s a very purpose driven life supporting the navy they’d be all about it. Thank you, Doctor. Uh, uh, Mr. Norcross, as my opening statement indicated, I completely agree that is why I focused on it, Ms. Oakley. I completely agree and want to let you know that we have ongoing work looking at the shipbuilding trades workforce where we’re hopefully gonna get into more details on what can be done, Mr. O’Rourke. I see wages as one of the two chief issues and the other is geographic distribution of the work. Federated shipbuilding can allow us to tap into regional labor markets across the country that are not already tapped out for their potential to generate people who would be interested in ship building, so wages and geographic distribution. So Mr. Chairman. All 4 agree, all 4 agree. Pay the people what they’re worth and you can get them done on time. I yield back. Mr. Norcross, if it was up to me, I would pay him, uh, and. Yeah, I, I now recognize for 5 minutes Doctor DesJarlais of Tennessee. Thank you, Chairman. Ms. Oakley, uh, last September, GAO issued a report outlining the challenges facing the Columbia class submarine program. As you know, the timely delivery of the submarines is critical for the nation’s nuclear deterrence posture. Yet the first submarine is projected to be delivered over a year late and hundreds of millions of dollars over budget. Can you provide a brief overview of the most pressing challenges affecting this platform?

And your your report includes recommendation for immediate reforms that the Navy should undertake, but is there any specific action that you believe Congress should take as well?

Thanks for that question. Yeah, we’ve been looking at the Columbia class program since 2017, and we’ve been identifying issues that were gonna be challenges and risks for this program all along, uh, specifically right now, the biggest challenges that they’re facing are with material availability and workforce shortages and not just workforce shortages, also workforce capacity. So when you’re trying to build up a workforce so significantly to be able to do the work that you need done. You experience the issue called green labor where um it just takes a lot longer uh for those folks to do things and it also requires a lot more detailed information to be provided to them and I think that’s been one of the biggest struggles that that program has dealt with at this at this point in time. I think the one thing that I would also say is is that we’ve made various recommendations to the Columbia Class program over the years to really do a critical assessment of the risks that are facing that program to ensure that everybody has a good understanding of what it’s actually going to cost and how long it’s actually going to take, and I think some of those. Risks are coming to roost now that they haven’t critically assessed. One final thing I’ll mention is that Columbia Class and Virginia class are so interrelated, um, and any issues on Columbia Class are gonna rightly affect Virginia class because of the shared builders and the shared industrial base. We’ve been recommending since 2022. That the Navy get the uh builders to update their integrated enterprise plan, which would identify the resources needed across the programs to be able to execute these programs at that 2 + 1 rate. And they have yet to update it since 2019, so I think that’s one clear recommendation that I would call to your attention. Thank you. Your report also noted that the Navy has received billions in supplier development funding, yet there’s little evidence that these investments have led to measurable improvements. What information should the Navy be collecting to assess the effectiveness of these programs?

Yeah, absolutely. I want to be clear that it is gonna take time to see results, right?

You know, this is a long term effort that’s going to uh be required, but the problem is it’s a short-term challenge. We’re facing near peer threats like we haven’t faced before and so. What our concern is, is that the Navy hasn’t positioned itself to know whether or not the investments that it’s making in the submarine industrial base are indeed paying off. They can tell you if a piece of equipment was bought or if workforce was hired or. Or you know, whatever the case, but really understanding is that moving us in the right direction in terms of the outputs that we need to be able to meet our goals that’s where we’re pushing the navy to develop those outcome-based metrics that they’re gonna be tracking and we hope they do it. Because honestly we can’t get 5 years down the road dumping billions of dollars into this and realize that our investments didn’t pay off. They have to be successful. Would it be helpful if this committee considered introducing reporting requirements on supplier investment effectiveness to improve transparency and accountability?

I think any support that this committee can give to the Navy’s action in this regard would be important. OK, are there any specific supplier component types that have consistently caused problems?

If so, what steps should be taken to strengthen the supplier base as a whole?

I it ranges, you know, there’s a number of issues. Forging is one of the biggest challenges, and, you know, the Navy is really doing a good job of trying to target what those key issues are in terms of the, the bottlenecks um by identifying critical suppliers. Um, and also I would like to call out that the Navy is taking some steps to try and address some of these supplier base issues through the use of technology and additive manufacturing, and I think that those are very promising approaches that if the committee were to um provide support in in terms of um of, of, you know, encouraging the navy to continue down that path to address some of these challenges, it would be a good thing. OK, thank you all for your testimony today, Mr. Chairman. I yield my time and Mr. Whitman’s back. I now recognize the gentleman from Maine, uh, an important member of this subcommittee, Mr. Golden. Thank you, sir. Uh, Mr. O’Rourke, in your testimony or written testimony anyway, you talked about a shipbuilding lessons learned process at GD BIW one of two yards building destroyers. So up in BIW for years, a lot of the workers carried around their own version of lessons learned in a little notebook, uh, that they use out on the job. So I’m I’m curious if you could elaborate on how you envision these lessons learned centers operating. Is this a place where shipbuilders can go to learn the lessons from the perspective of the navy or is it the other way around?

Is it both?

And if I could just, you know, tip my hat a little bit in one direction, what other ways could the navy not just utilize the skills of shipbuilders but also their wisdom and knowledge of how to go about doing it?

Yeah, as I indicated in my statement, although the term that is often used as lessons learned, I’ve, uh, observed many occasions over the years where the navy appears to not really have learned the lesson but simply note it and then eventually forget it only to have it be rediscovered the hard way years later by um uh practitioners that uh come after them. Uh, and so as a consequence of making that observation, uh, one option that can arise would be to create a navy shipbuilding lessons learned center, and I first, uh, presented that option before, uh, this committee 10 or 11 years ago in testimony, so this is nothing new. That lessons learned center can be as simple as a physical meaning a shelf collection of past experiences that have been written down from prior programs or it could be the electronic version of that sort of thing today computer files it could be both. It can be made available to practitioners within the navy. It could be made available to people within the industry. I don’t see why you couldn’t make it available to anybody or everybody who might stand to benefit from it. I don’t see the option as being that complicated. It’s just a matter of deciding that you want to do that. We have lessons learned centers for battlefield lessons and how to fight wars. This would be an analog within the production sphere. Thank you. Uh, shifting gears a little bit, Ms. Oakley, the Marine Corps is unable to maintain their USC Title 10 requirements because of the amphib ship availability, which isn’t at full capacity, mostly due to maintenance restraints. I say this because you’ve talked about this quite a bit in recent months on a podcast and your reports and in written testimony. So how do we go about fixing this issue, or is the problem simply that 31 minimum amphib ships isn’t gonna be enough?

Yeah, I think you know our report on the amphibious ships really highlights a key challenge in some of these major modernization and maintenance periods that go on that do directly affect the availability and readiness of the fleet, and the amphibs are no no difference with half of the amphib fleet being in unsatisfactory condition, it makes it very difficult to imagine that the Marine Corps’s requirements are going to be able to be met in the coming years because it also relies on. Increasing the pace of acquisition of the amphibs, which, given the challenges that we’re talking about today with regard to the industrial base and and being able to support that, I’m not certain is very realistic. Thank you. Uh, I think I want to point out to that for years the, uh, the signal from the navy to destroy your yards was to get to 3 ships per year. Um, then they suddenly came out with just a 9 + 1 multi-year procurement. I think we’re kind of on pace maybe to go beyond that, which will drive up costs. Um, what do you have to say about that, Mr. O’Rourke, and, and what other um platforms might benefit from a multi-year procurement that currently doesn’t have one. Yeah, the navy used multi-year procurement uh with the destroyers um since the mid 90s if I recall right, and um almost all of the Virginia class submarines, all but three of them have been done under uh multi-year contracting of uh one form uh or another. It is an optional element of what I refer to in my testimony as the broader effort toward continuous production. It’s the one that is most well recognized people are most familiar with because we have been. Uh, doing it for such a long time, um, and, uh, it is something that can be applied to other ship building programs, uh, if policymakers agree that that would be cost effective. This committee and the Congress as a whole has a long history of providing approvals for various ship building programs to use these contracting forms. Uh, over the years it is a way of providing stability and continuity to the industry and, uh, uh, as such, as I mentioned a moment ago it can form a part of the broader uh option that I discussed that I referred to as continuous production right thank you Mr. Chair. I now recognize the member from the Commonwealth of Virginia who has such great vision and brings such strategic vision to this committee, Ms. Higgins. Thank you very much, Mr. Chair and thank you to our panelists for being here. I have the privilege of representing Virginia’s 2nd congressional district, so Hampton Roads, home to Huntington Eagles just outside my district, and most importantly, so much. Prepare and shipbuilding people. So, so listening to you all, uh, it’s a lot, it’s a lot. It’s, I wish it was a little more positive direction, but I think there’s some important lessons for Congress to learn. We can’t keep doing what we’re doing, I think is the bottom line, and it is encouraging to have the President of the United States stand up to state of the Union and talk about prioritizing shipbuilding. The fact that we have now a new office of shipbuilding, these are all steps in the right direction, but I think we’re gonna need to see some, some big overarching changes. And what does that look like?

I mean, the ideas you’ve talked about today between the technology, we, we can build unmanned aircraft using robotics. Why can’t we do better with especially ship components?

I mean, the design aspect, I have a, a son who studied naval architecture at the Naval Academy. I know it was one of the few schools that they actually have that that degree, so. What can we do, you know, to, to incentivize kids just to go to the design piece the labor challenges, it’s hard for me to listen to you all talk about. I sat on the recruitment retention Quality of life task force that we did from this committee last year where we looked at all of those things for our active duty side we improved. Paying compensation, we improved the house and we improved childcare, the health care, the spouse employment. It’s the same issues that you all are talking about and we took 29 amendments that came out of the Senate to the tune of $5 billion that we’re making sure in this year’s continuing resolution that we’re passing that we’re gonna hopefully pass today because it’s so meaningful to us that work that we did because we cannot keep this all volunteer force without those those quality of life changes for active duty, but the same can be said, not just for shipbuilding and ship repair, but for our MSC. task as well, and we know that with our navy, we can’t do the job that we need to do without our military sealift command, which is also important in my district. We’ve had the opportunity to visit, but But we can incorporate these changes across the board. Uh, you know, it’s, it’s interesting that the geographic issue, you know, the living along the coastline is historically expensive. I can speak, you know, speak to that from Hampton Roads area, but can we build components in places like the Midwest?

I know we’re doing it in Virginia and Danville. We’ve got a great center, but when we take people out of Danville where they’re from and move them, you know, to other parts where there may be shipbuilding. It’s a harder transition. So what, what does that modular component look like and that, that build, I think there’s ways that we can, we can do things. But I want to talk specifically and I, we, we printed this poster about the military seal of command and And there are so many ships that that we can be building that are not warships. I understand, you know, building the warships domestically and what that looks like and our challenges that we’re going to work through. But on the MSC side, like, for example, we used to have 8 AOEs. We’re down to 2. We’re down to 2 of these, these are, if we don’t ships and food and supplies, we can’t keep the fleet at sea. So, so I’m, I’m really focused and I think we’re not, we’re leaving these guys kind of out of the equation sometimes, but How can we, how can we do better on this side of the house?

Is it something I know a few of you have spoken about the South Koreans specifically and involving some of our allied partners, but what does that look like?

What is it, is it, is it a, is a place we need to pursue that we need to use, think outside the box and be using our allied partners, especially when it comes to this MSC type leader. I can’t do it all domestically. So what can I do because I, I want them as soon as I can get them, but But are there any of you you can speak to just especially the use of allied partners for things like military seal of command?

Um, I, if it’s all right, I’ll, I’ll answer take an answer that question. Um, again, sort of, I’m not in the business of making recommendations, but I would sort of answer this question this way is that if you believe you need a larger fleet, you need to recapitalize both the warship fleets as well as the military sea lift command. Then I think that and given that the the capacity of current shipbuilding yards is, you know, is is full, looking at the question of our allies being able to supply some of these types of ships is something that is worth considering. Um, there’s all kinds of advantages and disadvantages of bringing the, the allies and and partners into the ship building portfolio, whether domestic or overseas, but you know, in December, President Trump, he made a suggestion along those lines in an interview with the press and. It seems like the the the public would, would, would benefit from that. The Japanese and the Koreans in particular are, are, you know, build outstanding ships that fall into the military sea lift command portfolio if you’re talking about robo ships and cargo ships and things like that. Some of the more specialized ships under the military sealift command might still be better built in American yards, but it is at least worth having that public debate and having that conversation about whether, um, you know, others need to be brought into it, not only for Navy but also Coast Guard and, and icebreakers. That would be another place to sort of have that conversation as well. I agree, do any of any you others have thoughts on on that?

Well, in my 8 seconds, I’ll just say committed to working with Marad and, and, and ensuring that we prioritize uh military sea lift command in the build of those ships. I think, uh, you know, rising tide raises all boats and certainly the commercial sector getting stronger is gonna help us to and what we’re doing in the defense sector, so all committed. Thank you. I think it’s a warrants a further discussion, but thank you so much for your opinion. I yield back. I now recognize the gentleman from the UP. Mr. Bergman Thank you, Mr. Chairman, um. Being a Marine, you, I’m not gonna waste your time, our time, or anybody else’s time, um, so any one of you can or all of you can offer the comment if you choose. Does the Navy currently have the capability to put pun intended the necessary rudder into this big ship called shipbuilding ship repair ship design?

Does the is the navy currently structured to actually be able to do that?

Yes or no?

You don’t have to give me why they’re not just yes or no. No. No. OK. Anybody else?

Did anybody, anybody gonna offer a yes?

OK, so let’s move on from that then um. Somebody said commercial shipbuilding still exists because of the Jones Act. I heard that within the last 24 hours. Anybody want to comment on that?

Um, as, as you well know, Congressman, there is very little, um, commercial ship building done in, in American shipyards today. To the extent that there is some commercial shipbuilding that does occur, it does seem to me that they, it is mostly Jones Act ships, which is building ships for intra, uh, uh, intra-U United States, uh, trade uh between, you know, one US port and another US port. So, um, that is simply the current description of, of where we are today, OK. Uh, thank you, uh, Mr. O’Rourke, you, you cited the South Korean model and we just talked about it in, in the last questioning, um. Could you name one or two things that the South Korean model?

Exhibits utilizes that maybe you think we should adopt. Uh, I think the Navy certainly has the opportunity to adopt uh those practices that the South Koreans follow that, uh, I mentioned in my testimony. In fact, I became aware of them, uh, via a conference, um. Of, uh, two professional societies that relate to marine engineers and they were speaking mostly to Navy people and it was their view that those practices should be imported into the Navy’s own practices so right from the outset, the whole reason for my awareness of. South Korea’s practices in that regard came from professional conferences where people working in the field were telling that to the navy. OK, so my understanding of what you said was um some professionals who were attending a conference referenced the South Korean model as a positive. OK, are there, are there any other countries that would. Come close to the South Korean model or something else that you know that we could learn from or partner with or however you wanna call it. Yes, the other country you could learn from is Japan. Japan and South Korea are often mentioned almost side by side when people talk about um best practices uh on a world standard in shipbuilding. And there are two things that you could learn from uh the Japanese. One, which you can also learn from the South Korean is how to manage shipyard operations more efficiently in terms of training new workers and staying on top of and managing the material flow through the shipyard. And secondly, you could learn from Japan the model of keeping the procurement rate steady even as four size changes by managing it at the back end through end of life decisions, not through upfront procurement uh rate tinkering OK. Uh, are there any other countries, uh, uh, just are there any other countries anywhere else in the world, any part of the world that I mean right now we’re focused kind of on one part of the world here, South Korea and Japan. Are there any other parts of the world that may not be as quite the top tier but definitely would be you, you could look at the European yards as well. Japan and South Korea are in competition with China. So they are trying to hold on to their market share against the Chinese, uh, shipbuilding and so they are laser focused on making their own operations. So they’re the same as the example that’s a long time ago there was Ford, GM and Chrysler all in Detroit area competing for the future of the market. Now this is a different. Example of that it it is because right now those three countries, China, South Korea, and Japan account for more than 90% of the world, uh, commercial ship building market. Uh, China is like 40 to 50% and then South Korea 30% more or less, and Japan 20%. OK, I wanna get Doctor Seidle. I wanna give Doctor that’s just a second. I know my can Doctor Seidle, give me a quick 10 seconds. Yeah, hey, I just wanted to say you move fast on that first question about are we structured to do the right thing. In my opinion, we, we can and are, and there’s improvements that can be made, right?

So I think it can happen. Thank you, Mr. Chairman back. Thank you. I now recognize the gentleman from Texas, Doctor Jackson. Thank you, Mr. Chairman. Uh, most of my questions has actually been addressed. I’m just gonna ask you one real quick question. I apologize if this was already addressed before I came into the room, but, uh, I just wanted, wondering, uh, with regards to, uh, some of the innovative technology that’s out there nowadays, uh, production line automation, artificial intelligence, robotics, um, you know, could this deliver additional capacity?

I mean, I know it can, and efficiency in shipbuilding. Is it, how, how aggressive are we being on this front?

And I had another question and I, and I’m not, uh, Saying that this is the primary reason by any means, uh, because my, uh, uh, colleagues on the left have pointed this out a few times to me when I brought this up. But what role does organized labor play in this as well?

Because it seems like when you have a lot of these, uh, you know, uh, these hardworking blue-collar jobs, uh, like shipbuilding, uh, there’s organized labor has a big part in this and they really push back sometimes on automation. And I think what’s been mentioned is like, look, if we can make things more efficient, we can expand the production and, you know, there’s more work for and you can, you can keep this. Same number of people just employ them in different areas, but it seems like there’s a lot of pushback. I mean, you know, the, the, sometimes organized labor doesn’t believe that. They don’t buy that argument. And when it comes to things like automating the, you know, the gate at the entrance to the shipyard, they don’t want to automate that because that’s someone’s job. So, are we overcoming that?

Are we, are, are, you know, is, is this, is this the future of shipbuilding is, is, uh, some of the stuff I mentioned and are we working with organized labor to come up with, uh, ways to do that and still employ people?

Yeah, so I’ll take that question. Uh, listen, we, we are spending a lot of effort on modernization of the yards, trying to drive in, uh, advanced manufacturing techniques. Uh, we’re also working with our supply chain network. The mid monies that we talked about are, are going toward those efforts we have right now quickly over 700 projects with 300. Uh, different suppliers across 33 states and there’s 11% improvement in performance for them that that are undertaking those from an advanced manufacturing technology perspective, especially an additive, uh, we’ll do an SSGN availability here shortly that’ll have 33 additively manufactured parts and, uh, would have never couldn’t have been sourced any other way. And and some of them will be subs safe so I think we are driving that kind of, uh, those kind of capabilities into our yards and our supply chain network. I haven’t heard that the organized labor piece, uh, is a problem at this at this point and, and I honestly don’t expect it will be, even though I respect what you said as a guy who used to work with UAW a lot too. I’ve watched us automate yards in the automotive sector or automate plants and uh. And, and there’s always some work and some initial pushback, but we typically get through that, and I expect we can as well in the, in the maritime industrial base. Oh, OK, I appreciate that. And before I just have 2 minutes left, I was gonna give you guys the opportunity, the ones that didn’t get to answer, uh, Ms. Kagan’s question while I go because one of my questions also was about our ability to allow some of our, uh, uh, some of our allies to help us, and not only shipbuilding with the maintenance and stuff. I know when I was over in Australia recently talking about Aus, uh, there were plans to To, uh, to build some shipyards and stuff over there and, you know, so that it could, you know, basically help us. I know that I would prefer that we do everything here in the United States, you know, obviously, but, uh, I, I, you know, we can all see the writing on the wall that that’s a long time coming before we get to where we need to be. Is this a way to help us get there faster?

They would provide inter intermediate maintenance, uh, capability, things of that nature if we’re fighting over in the Indo-Pacific, we, you know, I think it, you know, it’s, it’s a national security, uh, asset as well. Listen, the Aus partnership obviously very important to us and uh we’re doing everything in our power, uh, to support the 1 + 2 and 1 + 2.33 to get there. I think it does help us and and having strong relationships, um, in that trilateral agreement certainly very critical. I’ll yield so other folks can have a chance. I would just make one comment that that there’s kind of a a delicate balance that has to happen with the industrial base in terms of keeping the yards that you have existing healthy, um, and inserting new yards into the industrial base. It becomes a little bit of a Of a balance that has to be made because um of the fluctuations in the flow through of of ship programs through these yards you know any one bad year could result in laying off employees in some of our existing yards and so I think a real holistic look at. What the solutions are to be able to shore up that industrial base and ensure we have a vibrant commercial ship building industry that then supplements and augments um our naval shipbuilding industry as I think a key area should be a key area of focus going forward. Thank you, ma’am. And it looks like I’m out of time, so I’ll just leave it there. I’ll yell back. Thank you, Mr. Chairman. Now the gentleman from Louisiana, Mr. Higgins. Thank you, Mr. Chairman. That the chairman, my colleagues, I think, I think we recognize the significance of of today’s hearing we have to tackle this thing. The United States shipbuilding industry. Has the capacity to meet our nation’s maritime needs yet we’ve seen. In modern history. We’ve seen a disturbing trend of inconsistent government contracting, excessive program engineering design changes that are endless. lack of long term commitment. That when all combined it it that prevents shipbuilders, especially smaller shipbuilders which have historically carried a great burden of our our requirements of our nation of floated navy that’s indomitable around the world, we need our, our smaller shipbuilders across the country to be vibrant and successful. But we, we have baked in a formula that makes it quite difficult for them to perform. And Investments and like workforce expansion and infrastructure for the smaller shipyards requires uh a a solid long term commitment with their government partners when they’re building vessels. So that they can be healthy and and vibrant and have the strong workforce with time on the job and the appropriate infrastructure and modernization to perform on the next contract so the revitalization of our ship building industry could very well. Determine the outcome of our next conflict, so we have a heavy responsibility here to pay attention to it. And I’d like to to direct my first question more if I have time, but Ms. Oakley. Um, Given the strategic importance of strengthening our domestic shipbuilding base, which is a common theme here today. Um, what, what do you see as the, the primary obstacle regarding what I refer to as the baked into the formula coming from, from the Navy and DOD regarding constant design changes and uh and a moving target for for our shipbuilding industry. Could you address that please?

Yeah, I think there’s a couple of things. um, in my opening I mentioned that the Navy often puts forward optimistic business cases, right?

So the best case scenario in terms of the cost and schedule estimates, given the risks that are apparent on these programs, everyone knew that this was going to be a challenge to build up, for example, for the Columbia class program, the Virginia class, um, maintaining both of those at the same time. But we didn’t act on that information soon enough to be able to respond and so I think that really critically examining soon enough but but you’re describing years past, correct?

Yeah, yes ma’am, please continue. Um, so I think one of the biggest challenges with regard to what we’ve seen. And navy shipbuilding over the years in in in respects to design is, is that not enough work is done up front to be able to know what we’re signing on the dotted line for and how would you I can shift because I, I’m respectful of your time and the and and the ticking clock here, um, regarding American yards and and shipbuilding and uh how the how the Jones Act plugs in there, uh, and. Would you address the the consequences of overdependence from an American perspective and a national security and indeed a world security perspective for America’s, uh, the danger of overdependence on foreign shipyards and how that plugs into the Jones Act, for instance, in the icebreaker realm, um, I, I think the ships should be made in America. Would you address that that topic please, Ms. Oakley. I think there’s always a challenge with regard to um leveraging our allies and leveraging foreign shipyards for things that are critical to our own war fighting efforts, and I think there has to be a real understanding of what the impacts of that are when making those decisions, um, also balanced with what can. Our industrial base realistically provide us and I think that that’s part of the problem right now is that we’re hoping that this industrial base can be mobilized to be able to meet our needs and grow our fleet to 380. Would you agree that on to identify the a category of vessels as say crucial vessels, would you agree generally that uh that American treasures should be should be invested in American shipyards in the building of crucial vessels?

I mean, I would say that the Navy would agree with you. I don’t know that I necessarily have a position on that. Thank you, madam, for an honest answer, Mr. Chairman. I yield. I now recognize the gentleman from Guam who is such an important member of this subcommittee and also has a very strategic region of the world which he represents, Mr. Morland. Thank you, Mr. Mr. Chairman, and, uh, for holding this hearing today to discuss, as you mentioned, this critical shipbuilding need, and Guam is a key strategic asset. In the Indo-Pacific and playing a crucial role in defending our nation, its location makes it an important logistical hub for moving personnel and supplies to support our presence in the region. Our nation faces challenges across the defense industry base, particularly with shipyards and shipbuilding. The ship repair facility in Guam was closed in 1997 during the BAC process. But the equipment was left behind and still there today with the increasing threats and Indo-Pacific, we must focus on improving our readiness. This means having the right infrastructure to support our navy ships and submarines which are essential for deterrence and protection in the region as we prepare for future conflicts, it’s vital to maximize all available resources to enhance ship maintenance and repair capabilities. We cannot overlook Wang’s potential to provide the support needed to keep our military assets ready and operational in this key region. So my question, uh, for Mr. Rourke, you mentioned that poor planning scheduling. And funding are the main challenges affecting the timely completion of ship maintenance and repairs. Do you believe having having ship repair capabilities in Guam could help mitigate the scheduling issues by cutting down the return time from Hawaii to the mainland?

I know that the Navy is interested in improving its ability to perform ship maintenance in the uh Indo-Pacific region, and that extends even to a navy interest in wanting to understand what foreign shipyards can do in terms of battle damage repair during time of conflict if the Navy’s interested in that then uh it would uh make sense for the navy to be interested in making sure that they are taking uh uh advantage of the opportunity. That Guam presents for ship repair both on a day to day basis and again for battle damage repair during time of conflict. Uh, thank you. And as my colleague mentioned, Guam is USA we can trust US soil our ship repair folks over there as well. So thank, thank you for your answer. This question is for Doctor Shade. But your testimony highlighted the importance of expanding and modernizing key production and repair facilities for our nation’s security given Guam’s strategic location, what efforts are being made to reauthorize the lease for the Guam shipyard repair facility to enhance capabilities in the Indo Pacific?

Sir, thank you. Obviously a very critical spot for us because of everything going on in that region. We are having those discussions right now around where we are trying to do our ship repair and ship maintenance. I concur with everything Mr. O’Rourke said also and I my commitment to you is to continue to have that discussion, uh, to try and get to a, a good solution that helps all of us, uh, and improves our tactical advantage there. I appreciate that and also along with your constant uh fight to let them know that we’re there we’re ready to serve and Guam is USA so let’s let’s help out one another so I appreciate that a lot. I mean it appreciate it and one more question for you please how can the federal government leverage partnership with local workforce development programs to address the shortage of skilled workers in the defense industry based to meet production demands?

Yeah, I think, uh, we are doing a lot of those things both local regions and nationally. We stood up the accelerated, uh, training facility for defense manufacturing in Danville. We have, uh, 6 regional pipelines and 1 national pipeline, uh, all part of the SIB and MIB monies that that you have also graciously funded us for. So we’re putting that to good use to get after, uh, trades and labor for the yards, um, and think we’re, we’re gonna, we’re having good effect there. I think it still then goes back to the attrition issues and what are we doing with wages to make sure that our retention once we get them. Uh, allows us to keep them so that we, we make the inroads that we need, but, but we’re after that. I appreciate that we have a lot of young kids anxious to help our nation and get that good education so with your support we can help fund that so I appreciate it. Thank you to the panels. Thank you, Mr. Chairman and you’re back. Thank you. I now, uh, recognize a little bit out of order my good friend, the ranking member Mr. Courtney for 5 minutes of questions upon which I’ll close after. Great, thank you, uh, Mr. Chairman and um. Uh, Ms. Oakley, I, I just wanted to go back to your comments regarding, uh, requirements and design, uh, completion before construction, which I could not agree with you more, um, but I, in terms of the Columbia program because it was sort of that was sort of in your in the mix there, um, when Columbia cut its first deal, it was 87% design complete, um, which, and I’m old enough to remember the Ohio class. Submarine program which it’s replacing um it was less than 20% at that time. A lot of land-based testing has been done for, you know, the propulsors uh you know, before it even got near the submarine for um. Uh, assembly, uh, that’s there and I think again that reduced a lot of risk, uh, during the process. It’s late right now, no question about it. There are two reasons. Number 12 primary reasons the power turbine generator is late coming from Sunnydale, uh, north of Grumman it’s a, it’s a new technology. First in the of its time, I mean it’s gonna take a while to, to, to, but they can’t sort of um build the rest of the submarine and then have to cut it open to insert that they have to wait for it and the bow is late from from Newport News again there’s a tier team that’s uh down there working in terms of trying to get that but in terms of, you know, really, um, a, a program where the requirements and design was done up front. I mean, honestly, Admiral Papano I think did an outstanding job. In terms of just relentlessly pushing um that sort of sequence uh as as that program uh was going into place, Doctor Seidel, in terms of the requirements issue again GAO is right about the fact that you know this has been whether frigate and some of the other LCS just that was changing, you know, it seemed like every hearing C Power held during the over the years. Um, the, the vessel contract manager that I mentioned in opening remarks where, uh, we used to, you know, commercial model for, for the maritime training ships which can be converted into a you know, uh, uh, sea lift vessel at time of emergency. I mean it worked and it just, it seems like we’ve had Navy personnel come visit the Philly shipyard to to see it for themselves again it just feels like. You know, we, we’ve gotta go more with the navy in terms of just getting them to let go, maybe even, you know, some of the less exquisite vessels to just sort of, you know, follow what the, the commercial industry is doing so that we can speed things up. I mean, I was wondering if you could comment on that. Yeah, two things. One, you know, to the point about design, and we’ve had a lot of discussion about that today. I feel like for success in this arena, it’s rigor and discipline and requirements than design and production because if you’re rigorous about all three then things flow you don’t get out of sequence material you don’t have those kind of issues. I think we have an insatiable demand, uh, appetite for capabilities at times for good reason. Uh, we are the finest navy ever assembled because we have capabilities that outpace our adversaries and so, um, when we come to those crossroads we always struggle to say stop, um, we’ve already snapped a chalk line and we need to stay with the design we have so that it’s more producible for our industry partners so, so I think. I know we know what to do to make that better. We’ve got to be rigorous and disciplined and doing it to your point about Mayorad and the vessel construction manager, uh, I’ve taken several briefs on that now. I concur with you. It looks like they’ve been very successful, um, control some of the little R requirements compared to the big R requirements and and and. And have led to some decreased costs there that I think looks good so I I I intend to go meet with them and have some real discussion. I think there’s some opportunity uh in our space to take that model and use it for some of the work that we’re doing and, and my commitment is to lean in and and work to try to do that. I mean that’s great to hear and anything we can do to to push that along, um, appreciate it for sure, um. Uh, Ms. Oakley, again, I’m was glad to hear that you now are gonna be focusing on workforce training as part of a project that Sarah. I really encourage you to come up to Groton and see the manufacturing pipeline again that reason why they hit that 5300 higher number it was 4000 last year and having such great retention is because of the design of the curriculum, OK, and it, and it’s, it’s, um, it’s something now that I think other regions, uh, are starting to emulate because. You know, if it’s too short, then your, your people are gonna flush out once they see the reality of a shipyard. If it’s too long, it’s just too long. We, we need it faster. So again, I hope you’ll take up my invitation. We have definitely been there and we will be back. Great, thank you. I yield back. Well, I can’t let him do that. You need to come to Pascagoula and see how it’s really done and how it’s done right, uh, and has been for a long, long time, uh, but with that being said, I thank all of you witnesses so much for being here today. You’ve added a great contribution. This was a great hearing and it’s a great hearing because of the great witnesses we have. Thank you and with that this hearing is adjourned.