The U.S. Navy has chosen Bath Iron Works’ chief competitor Huntington Ingalls Industries to repair the Bath-built USS Fitzgerald, which was damaged in a June 17 collision with the Philippine-flagged merchant vessel ACX Crystal off the coast of Japan.
The Fitzgerald (DDG 62), which was launched in Bath in 1994, is an Arleigh Burke-class destroyer serving as part of the U.S. Pacific Fleet.
Only Bath Iron Works and Huntington Ingalls build Arleigh Burke-class destroyers for the Navy. The two companies are currently completing destroyers awarded as part of the last multiyear procurement. Both companies are preparing bids for another multiyear procurement to be awarded next year.
The contract initiating the restoration of the Fitzgerald at Huntington Ingalls’ shipyard in Pascagoula, Mississippi, before the end of the year, was confirmed Wednesday in an email to the Bangor Daily News from Colleen O’Rourke at the Naval Sea Systems Command Office of Corporate Communications.
The start date, scope, cost and the time required to fully restore the ship have not yet been determined, O’Rourke said. The U.S. Naval Institute reported in July that repairs to the Fitzgerald would easily top the $250 million cost of repairing the USS Cole following the 2000 terrorist attack in Yemen.
“The Navy chose this course of action following a review of the capabilities and workload of new construction and repair shipyards,” according to the statement. “Given the complexity of the work and the significant unknowns of the restoration, the Navy determined that only an Arleigh Burke-class shipbuilder could perform the effort. Only [Huntington Ingalls] has the available capacity to restore USS Fitzgerald to full operational status in the shortest period of time with minimal disruption to ongoing repair and new construction work.”
The Navy is also evaluating proposals to award a contract for the heavy lift transport of USS Fitzgerald from Yokosuka to the continental United States, she said.
Last week, the Department of Justice announced that Huntington Ingalls would repay $9.2 million to the Department of Defense to settle allegations that it overbilled the U.S. Navy and Coast Guard for work conducted at the Pascagoula shipyards. The settlement is the second largest in the district’s history, according to a release from the Department of Justice.
Huntington Ingalls allegedly overcharged for work incurred on particular contracts to other contracts, even though the costs were not actually incurred by those contracts. The settlement also resolves claims that Huntington Ingalls had billed the Navy and Coast Guard for dive operations to support ship hull construction that did not actually occur as claimed.
Mike Keenan, president of Local S6 of the Machinists Union, the largest union at BIW, said Wednesday that he was stunned when a member of BIW’s senior management called him Wednesday morning to tell him the decision. Keenan said members of the 3,700-strong union have been filtering into the union office all morning searching for answers, but Keenan had none for them.
“This wasn’t just any ship — this was our ship,” Keenan said of the Fitzgerald. “This meant everything to us. This would have been such a pride thing to repair one of our ships that was damaged and we lost some brave men and women … but to put salt in the wound by the Navy not even considering us — that was a heartbreaker.”
Keenan said a member of Local S6 traveled overseas with other BIW employees recently to help assess the damage to the Fitzgerald, which led union members to believe the company would at least have a chance to bid on the repairs.
This morning, Keenan called each member of Maine’s congressional delegation searching for answers. At 11 a.m., he hadn’t heard back. The delegation did not immediately respond to requests for comment from the Bangor Daily News.
A Bath Iron Works spokesman on Wednesday declined to comment on the announcement.
Jay Korman, managing director of strategy and management consulting firm Avascent, said Wednesday that while he was not privy to the decision to award the contract to Ingalls or to the criteria, the Navy has previously shown “a willingness to … ‘level set’ both yards by way of backlog.” He said cost is also a factor.