BATH — Bath Iron Works lost out on a $936 million contract to build an Arleigh Burke-class destroyer Monday when the Navy awarded the project to Huntington Ingalls Industries in Mississippi, BIW’s main competitor.
The announcement comes as the shipyard’s largest union continues its strike. Machinist Union Local S6, which represents 4,300 of the shipyard’s 6,700 employees, went on strike June 22 after rejecting the 3-year contract proposal over disagreements about the company’s plans to continue hiring subcontractors and proposed changes to worker seniority privileges.
BIW and Ingalls are the only two shipyards manufacturing that Arleigh Burke-class destroyers. In 2018, the Navy awarded BIW four of the destroyers for $3.9 billion and six to Ingalls as part of the 2018-22 multiyear contract with the Navy. The contract had funding for two ships each year, but allowed the shipyards to compete for a third ship each year if there is enough funding available.
This suggests there will be an opportunity to compete for a third ship in both fiscal years 2021 and 2022, BIW spokesman David Hench said Wednesday.
In a letter to employees Tuesday, BIW President Dirk Lesko said the Navy has repeatedly said it wants to accelerate the delivery of ships to its fleet, adding, “Simply put, speed matters.” The shipyard must continue to focus on growing its workforce and investing in its facilities and production process in order to win new work, Lesko wrote.
“This contract award is another reminder that we must work together to resolve the issues at hand and get back to work so that we make progress toward those goals,” he said.
Local S6 spokesman Tim Suitter said BIW won a third Arleigh Burke-class destroyer last year, so no one expected BIW would get an additional ship contract in 2020, in part because the shipyard already has a backlog of work it needs to get done.
“The way to do that isn’t by continuing to strip the workers of their rights that they’ve bargained for in a contract because it just creates a whirlwind,” Suitter said Wednesday. “It’s not good for morale and it’s certainly not good for management.”
Suitter agreed that speed is important, but there are many factors that have put BIW six months behind on production. There has been an influx of new workers, interruptions from facility upgrades, and the work on the Zumwalt-class ship has required a lot of resources. The shipyard can do a lot to improve workflow but Suitter said the company and union disagree on the solution.
“If you want to get faster, you’ve got to have motivated employees, ” Suitter said.
Bath Iron Works has built 47 Arleigh Burke destroyers over the life of the program, which is five more ships than Ingalls, according to USNI News. A mainstay at the BIW since the late 1980s, Suitter called the program the shipyard’s bread and butter.
There are six Arleigh Burke destroyers in production at BIW, along with a third and final Zumwalt-class destroyer. The shipyard hasn’t yet started fabricating the five ships it was awarded in 2018 and 2019.
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