SPECIAL REPORT: Sub Deal Poses Questions About Shipyard Capacity

By Stew Magnuson

Navy photo

This is part 2 of a 4-part special report on the trilateral agreement known as AUKUS — Australia, the United Kingdom and the United States.

The trilateral agreement that would have the United States and the United Kingdom assist Australia in acquiring a fleet of nuclear-powered submarines has raised concerns about shipyard capacity.

The three nations in 2021 agreed to build the subs after Australia scuttled a deal with France to help it build a fleet of 12 diesel-powered boats. The Royal Australian Navy decided it needed longer endurance, quieter nuclear-powered vessels to compete with a rising China in the Pacific.

While the AUKUS deal includes an agreement for the three nations to cooperate in an array of advanced military technologies, the submarine program is the heart of the deal. The three nations are currently at the end of an 18-month study period to determine the path foreword. That work is expected to wrap up in March.

Meanwhile, at least one senior U.S. Navy leader and some lawmakers have questioned whether the United States and the United Kingdom have the shipyard capacity to pull off the deal.

The U.S. Navy’s program executive officer for strategic submarines, Rear Adm. Scott Pappano, said a year after the agreement was inked that U.S. shipyards may not have the capacity to build another class of submarines while the nation is in the middle of building its Virginia-class and Columbia-class boats.

Pappano clarified that “he was not involved” in the discussions on the roadmap. However, he is responsible for ensuring that the U.S. industrial base and the Navy remain on schedule to deliver the two new classes of submarines.

“If you’re asking my opinion, if we were going to add additional submarine construction to our industrial base, that would be detrimental to us right now,” he said during a Mitchell Institute for Aerospace Studies webcast in September. It would take “significant investment” in infrastructure to add capacity, he added.

The Navy is on what it calls a 2+1 schedule: two Virginia-class and one Columbia-class must be delivered each year to meet demand.

Sens. Jack Reed, D-R.I., and the now retired James Inhofe, R-Okla., in December sent a letter to the White House expressing similar concerns. “We believe current conditions require a sober assessment of the facts to avoid stressing the U.S. submarine industrial base to the breaking point,” the chair and then-co-chair of the Senate Armed Services Committee wrote, which was first reported by Breaking Defense.

Pappano believed that lack of capacity was the case for the United Kingdom’s submarine industrial base as well.

The U.K.’s First Sea Lord Adm. Sir Ben Key confirmed Pappano’s concerns in late September when he said it shouldn’t surprise anyone that the U.K. and the U.S. industrial bases were right-sized to build their submarines and that there currently wasn’t any excess capacity.

“Up until the AUKUS announcement was made, we had scaled our industrial capacity to deliver what each nation requires in terms of submarine building,” he told reporters at the Atlantic Future Forum in New York City.

“It’s difficult to see why we would have had latent submarine building capacity just waiting in case someone else came shopping for it,” he said. If, for example, the nation had three empty sub-building facilities, the press and taxpayers would rightfully question why the Royal Navy was paying to maintain excess capacity, he added.

Nevertheless, the agreement was a “welcomed addition” to the shipbuilding enterprise, and long-term the goal is to have Australia build its own subs, he added.

The United Kingdom is working on plans to build up the capacity, he said. “I think it’s going to be a stretch for either nation, but it’s a really good stretch,” he said.

Like the United States, the Royal Navy is in the throes of developing its own nuclear-powered submarines that deliver nuclear missiles. The Dreadnought-class submarines are set to replace the Vanguard-class SSBNs in the 2030s, and construction has already begun on the first of four planned vessels.

It is also coming to the end of replacing its Trafalgar-class nuclear-powered submarines with the Astute-class, with five of the seven planned boats finished or under construction at BAE Systems Submarines’ Barrow-in-Furness shipyard.

The U.S. Navy has laid the keel for the first of its 10 Columbia-class submarines that will replace the Ohio-class boats, which are both nuclear-powered and carry nuclear weapons. They are part of the nation’s nuclear triad — submarines, intercontinental ballistic missiles and fixed-wing bombers.

Leaders such as Pappano, Secretary of the Navy Carlos Del Toro and his predecessors have repeatedly said replacing the Ohio-class submarines is the top service priority and that there can be little margin for error in the Columbia-class acquisition program.

The Navy has a narrow window to replace the previous fleet of nuclear-armed submarines. Pappano described the timeline as a “heel-to-toe” replacement schedule. The Ohio-class subs were intended to sail for only 30 years, although Pappano said there is a service-life extension program under way that could increase that to 42 years.

“We have not operated submarines out to 42 years, we’ve come close with the fast attack submarines that we’ve had out to the 40-year range, but it’s uncharted territory and so there are certainly risks,” he said.

Along with capacity issues, there are chronic labor shortages in the sub-building industry.

Mark Sermon, the U.S. Navy’s executive director at the program executive office for strategic submarines, said the sector — which includes the Navy, the two major shipyards and their approximately 17,000 suppliers — will need to add 100,000 new skilled workers over the next decade just to build the Virginia- and Columbia-class boats. And that figure does not include sustainment of existing subs or what may come of the AUKUS agreement, he said at an American Society of Naval Engineers symposium in January.
Adding sustainment of existing submarines and AUKUS may bump that up to 130,000, he said.

“There is a war for talent,” he said. He has traveled to hundreds of sub-supplier manufacturing facilities and what he sees over and over again are young and old white males. The industrial base needs to tap into the underserved communities that surround the shipyards, he said.

Given the human capital limitations, there is only one way forward to ensure the industrial base can deliver the parts needed to build the U.S. and Australian submarines, and that’s advanced manufacturing, particularly 3D printing, which has the potential to reduce delivery times up to 80 percent, he said.

Meanwhile, the Government Accountability Office in a January report, “Columbia-Class Submarine: Program Lacks Essential Schedule Insight amid Continuing Construction Challenges,” said General Dynamics Electric Boat is borrowing personnel from the Virginia-class program to keep the Columbia-class program on track.

That has contributed to Virginia-class delays, the GAO stated.

The GAO report calls into question how the Navy could work out an AUKUS plan when it doesn’t have clear insight into the Columbia-class schedule, noting that it had not conducted a “schedule risk analysis.”

“Without a statistical schedule risk analysis, programs have limited insight into how schedule risks could affect the likelihood of achieving key program milestones, including delivery, and the amount of margin — or a reserve of extra time — needed to manage critical risks and avoid delays,” GAO said.

In its written response to the GAO, the Department of the Navy agreed that the analysis was needed, but said it had other metrics to give it insight to the schedule.

It added that “the department agrees that the submarine industrial base remains a top program risk.”
There are two companies that operate private shipyards in the United States that build nuclear-powered subs: General Dynamics Electric Boat and Huntington Ingalls Industries.
When National Defense reached out for comment, General Dynamics Electric Boat declined to say how it was building up shipbuilding capacity for AUKUS. However, representatives from all three countries visited its Quonset Point shipyard in Rhode Island in December.

The officials “reviewed the scale and complexity” of the facility and discussed “the skills and technical knowledge required to manufacture nuclear-powered submarines,” according to an Australian Ministry of Defence press release.

“The visit supported Australia’s intent to develop a nuclear-powered submarine construction yard and build an Australian workforce with the necessary skills, training, and qualifications to build, operate, and sustain a conventionally-armed, nuclear-powered submarine capability,” the release stated. Huntington Ingalls Industries also declined to answer questions on how the company was preparing for shipbuilding capacity for AUKUS.

“HII has a proven track record of safely and efficiently building nuclear-powered submarines for our U.S. Navy customer,” a spokesperson for Newport News Shipbuilding, a subsidiary of Huntington Ingalls, said in an email. “We look forward to working closely with the Department of Defense and our industry partners to leverage our expertise when called upon.”

As for Australia, Deputy Prime Minister and Minister for Defence Richard Marles said that academia, the private sector and government officials have to start building up local capacity as soon as possible.

“One thing that’s really clear is we’ve got no time to waste, and we need to be on this thing straight away,” he said at a recent event at the Submarine Institute of Australia in Canberra.

“A whole lot of work” needs to be done to reach the capability, including building up the manufacturing workforce, he said.

The Australian government in 2020 announced that the nation was making the largest capital investment in its history to establish a “sustainable, continuous” National Naval Shipbuilding Enterprise it calls “Plan Galileo,” according to a Ministry of Defence statement. It intends to spend between 168 to 183 billion Australian dollars to execute the plan.

It opened the Naval Shipbuilding College in November 2018 and tapped Osborne Naval Shipyard North near Adelaide, South Australia, as its primary submarine building facility.

The government is still reviewing how many and what kind of subs it will be pursuing in the agreement pending guidance from its Defense Strategic Review and the Submarine Taskforce, which are set to be released in 2023, he said.

Previous Ministry of Defence statements have said “at least eight.”

Even though the submarine program can tap into the capacity of all three nations, they all need to prepare the defense industrial base for the long road to manufacturing, Marles said.

“Part of the attraction of AUKUS from the perspective of the United States and the United Kingdom is that the net industrial base of all three countries grows by virtue of the capacity being developed in Australia,” he said. “From a strategic point of view, it matters that the capacity gets developed,” he said.

— Meredith Roaten contributed to this story.

Part 1: Why AUKUS Is Unlikely to Deliver Nuclear Subs Anytime Soon 
Part 3 - To Come: AUKUS Partners Aim to Catch China in Hypersonics Race
Part 4 - To Come: AUKUS Countries Team Up to Develop Key Quantum Capabilities

Topics: Shipbuilding, Submarines, Navy News

Comments (1)

Re: SPECIAL REPORT: Sub Deal Poses Questions About Shipyard Capacity

If cant spell a simple word like "scuttled", best you stay out of the water.

Tim at 3:46 AM
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