Starting in 2017, the Navy will invest $25 million a year on new equipment, materials and processes to help manufacturer Huntington Ingalls Industries’ [HII] Newport News Shipbuilding ratchet down the price of Ford-class aircraft carriers, the program executive officer for carriers said today.
Rear Adm. Thomas Moore said he is looking for a two-to-one return on investment, and should he get that, the service might be willing grant HII further funds.
The idea stems from “design for affordability” initiatives devised by Booz Allen Hamilton [BAH] to cut the price of Virginia-class submarines by making design and construction more efficient, he said during a roundtable with reporters held June 15.
Over the past four years, the Navy and HII developed a laundry list of potential areas where the shipyard could make investments or improve its construction processes, but “what I haven’t had is a dedicated R&D (research and development) funding stream to go and pay for some of these things,” Moore said.
Many of the investments being considered by the Navy and HII would cut down the man-hours it takes to build the ships. For example, the shipyard is buying mobile outdoor tents to cover work areas on the dock, allowing laborers to more easily do their jobs during inclement weather. This summer, HII will also break ground on a large indoor facility so that employees can do more work indoors, he said.
HII also found that it could use a computer to designate all the places on a sheet of steel where workers need to weld a stud, rather than having a human measure by hand. Even if that only reduces labor costs by one hour per stud, that could make a huge difference because there are thousands of studs on the carrier, Moore said.
The shipyard has also made investments on its own, such as new equipment that allows workers to install cabling more quickly.
“It’s a series of things like that. There are no $100 million, billion dollar ideas out there. If there were we would have already taken those [steps],” Moore said. “It’s finding a million here, a million there and eventually get enough of those…That’s how you get a billion dollars out of a ship.”
Earlier this month, the Navy awarded HII contracts with a combined value of nearly $4.3 billion for detail design, construction and labor of USS John F. Kennedy (CVN-79), the second in the Ford class. Moore called it “the best CVN fixed-price contract we’re ever had” because of the steepness of the share lines —which “very quickly” move toward a 50-50 split on cost overruns between the government and HII—and the ceiling price of the contract, which is the lowest the program office has had. He declined to specify exact figures.
The price of the Ford-class will decrease by about $1 billion between the USS Gerald R. Ford (CVN- 78) and Kennedy, and will go down another $500 million from the Kennedy to the Enterprise (CVN-80). Much of that is coming from reducing the time and labor needed to build the carrier, which on CVN-79 is decreasing to about 44 million man-hours, about an 18 percent reduction from CVN-78. On CVN-80, the target is about 40 million man hours, Moore said.
“By the time we get to CVN-80 and beyond…we’ll be building the Ford class for the same man-hours we were building the Nimitz-class carriers for a ship that is significantly more capable and significantly more complex to build,” he said.
HII is slated to deliver the USS Gerald Ford in March 2016. The construction process for the ship was “not without its challenges,” Moore said, because developmental technologies integrated into the first ship boosted the risk and cost of the hull. One of those systems, the electromagnetic aircraft launching system (EMALS), began “dead load” testing earlier this month, using the system to hurl a large, weighted steel vessel from the ship in the same manner that an aircraft would be propelled forward.