ASDS Woes & Electric Boat Layoffs Leading to Rebidding Pressure
The U.S. Navy’s Advanced SEAL Delivery System (ASDS) program faces budgetary, performance, and timeline problems. The gaps are large and serious, and so it should be no surprise that political fallout has begun. US Congressional Rep. Rob Simmons [R-CT], said recently that the potential layoff of 2,000 workers at Electric Boat in Groton, CT only underscores the urgency in having the US Department of Defense rebid the U.S. Navy’s Advanced SEAL Delivery System (ASDS) program [his words].
Like the ASDS program itself, to say that the current situation at General Dynamics Electric Boat is not good is something of an understatement.
The Norwich Bulletin reports that up to 2,000 Electric Boat jobs will be eliminated by the end of 2006. Recent company projections suggest the workforce reduction will be in the area of 1,900 to 2,400 by the end of 2006, and the first wave of 150-170 job losses will cut across all sectors of the company. Decisions on the rest of the job losses will be announced later next year.
Three factors are driving the reduction in the company’s workforce. One of the biggest impacts is the U.S. navy’s decision to eliminate Electric Boat from future repair, maintenance and modernization work. That work will now be conducted by shipyards in Portsmouth, NH and Newport News, VA.
The second is the US Navy’s submarine construction schedule. The Navy plans to continue its construction program at one new submarine a year through 2011, with that work divided between General Dynamics Electric Boat and Northrop Grumman Newport News. The result is a submarine production schedule of one-half submarine per year.
The last driver is the lack of any new submarine design programs for the foreseeable future, now that the SSN-744 Virginia Class is entering full production.
Electric Boat President John Casey said Tuesday that future workforce reductions can only be avoided if production of submarines is increased to two a year, and contracts awarded for the design of a new class of submarines – neither of which appears likely to happen. Given those realities, as many as half of the company’s 11,400 person workforce at its Groton, CT and Quonset Point, RI work force could be eliminated by the middle of 2008.
Hence Rep. Simmons [R-CT] proposal.
“This [ASDS] is an important program for the Navy, and we need a proven team at the table,” Simmons said. “Electric Boat is the leader in the engineering, design, production and life cycle support of the world’s most advanced submarines. EB’s participation would also help prevent layoffs at the nation’s only prime contractor for nuclear submarines.”
Northrop Grumman currently holds the ASDS contract, and despite SOCOM’s plan to restructure the SEAL mini-sub program, it has shown no inclination to go to a rebid at this point.