| PART II: SHIPBUILDING OVERVIEW |
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In this section:
The regions The Gulf Coast region Convergence Incentives Workforce |
| South Mississippi shipbuilding |
...The numbers are startling and tell the tale of a shrinking industry.
...In the early 1980s there were more than 200 major shipyards for build and
repair in the United States and more than 112,000 workers. Some two decades
later the numbers dropped to just over 80 yards, and the work force just over
46,000, according to the Department of Transportation’s Maritime
Administration.
...The American Shipbuilding Association, a trade group for the nation’s largest
yards, has said the industry is in peril. Congressmen in shipbuilding states warn
that any further dismantling will threaten the security of the United States
because a domestic capability to produce and repair warships, support vessels,
and commercial vessels is fundamental.
...The military shipbuilding segment, a strength for United States shipbuilders, is
facing a particularly rough time in part because of the costs of fighting the wars
in Afghanistan and Iraq, in part because the Department of Defense wants fewer
ship. Add to that the growing bad publicity about newer warships that are flawed
and it’s clear the industry is in deep trouble.
...The industry itself is one of the oldest in the nation, and involves the
manufacture of ships, barges and other large vessels, both self-propelled and
towed by other craft, as well as the ship repair segment. Most shipyards
specialize in either building or repair work.
...The industry is divided into two segments: Those that produce for the civilian
market and those that produce for the military. The commercial segment
includes an assortment of associated businesses that produce shipboard
equipment, and is closely tied to the oil and gas industry through the building of
oil and gas platforms. The military segment, larger in terms of revenue, also
includes companies involved in weapons systems, such as missiles, and
communications-related equipment.
...While shipbuilding is not nearly as large in terms of revenue as the nation’s
aerospace industry, it is nonetheless substantial. U.S. shipbuilding and repair
industry account for some $8 billion to $10 billion in annual sales, according to
the American Shipbuilding Association. About 10 percent of the companies
accounted for 85 percent of the revenues. Military orders account for the vast
majority of U.S. shipbuilding revenues.
...In the early 1980s there were more than 200 major shipyards for build and
repair in the United States and more than 112,000 workers. Some two decades
later the numbers dropped to just over 80 yards, and the work force just over
46,000, according to the Department of Transportation’s Maritime
Administration.
...The American Shipbuilding Association, a trade group for the nation’s largest
yards, has said the industry is in peril. Congressmen in shipbuilding states warn
that any further dismantling will threaten the security of the United States
because a domestic capability to produce and repair warships, support vessels,
and commercial vessels is fundamental.
...The military shipbuilding segment, a strength for United States shipbuilders, is
facing a particularly rough time in part because of the costs of fighting the wars
in Afghanistan and Iraq, in part because the Department of Defense wants fewer
ship. Add to that the growing bad publicity about newer warships that are flawed
and it’s clear the industry is in deep trouble.
...The industry itself is one of the oldest in the nation, and involves the
manufacture of ships, barges and other large vessels, both self-propelled and
towed by other craft, as well as the ship repair segment. Most shipyards
specialize in either building or repair work.
...The industry is divided into two segments: Those that produce for the civilian
market and those that produce for the military. The commercial segment
includes an assortment of associated businesses that produce shipboard
equipment, and is closely tied to the oil and gas industry through the building of
oil and gas platforms. The military segment, larger in terms of revenue, also
includes companies involved in weapons systems, such as missiles, and
communications-related equipment.
...While shipbuilding is not nearly as large in terms of revenue as the nation’s
aerospace industry, it is nonetheless substantial. U.S. shipbuilding and repair
industry account for some $8 billion to $10 billion in annual sales, according to
the American Shipbuilding Association. About 10 percent of the companies
accounted for 85 percent of the revenues. Military orders account for the vast
majority of U.S. shipbuilding revenues.
...The Gulf Coast shipbuilding region is large, spanning an area between south
Texas and the tip of Florida. But within that large crescent most of the major
shipbuilding operations are concentrated in a 200-mile area between New
Orleans and Mobile. It has four of the nation’s nine active yards: Bender
Shipbuilding and Repair Co. Inc. in Mobile, Ala., Northrop Grumman Ship
Systems’ Ingalls Operations and VT-Halter Marine Pascagoula, both in
Pascagoula, Miss., and Northrop Grumman Ship Systems’ Avondale Operations
in New Orleans.
...In addition, four of the seven Gulf Coast shipyards with build positions are in
two adjacent counties: Alabama Shipyard and Austal USA, both in Mobile
County, Ala., and Signal International LLC – East Yard and VT-Halter Moss
Point, both in Jackson County, Miss.
...This focus on shipbuilding has been a way of life for a long time in this region
of the country, beginning with the first European settlers. In World War II,
Alabama Drydock and Shipbuilding Co., Gulf Shipbuilding, Ingalls Shipbuilding
Corp., Delta Shipbuilding and Avondale Marine Ways were among the U.S.
shipyards that produced 4,600 ships for the war effort. Ingalls by June 1945 had
built more than 70 ships.
...Today the Gulf Coast continues to have a strong base of major shipbuilders
and a large slate of smaller shipbuilders, as well as an array of vendors. But the
region’s shipbuilding industry is far different than it was in the ’80s or ’90s.
Companies that once existed are no more, new players have come into the
region and shipyards that once competed for contracts are now under the same
corporate umbrella.
...One of the new shipbuilders in the Gulf Coast is Los Angeles-based Northrop
Grumman, which through a series of acquisitions beginning in the mid-1990s
went from an also-ran in the defense industry to No. 3 behind Lockheed Martin
and Boeing. It became a major player in the shipbuilding industry with the
purchase of Litton, which owned a yard in Pascagoula and New Orleans, and
Newport News Shipbuilding in Newport News, Va.
...Foreign interest in the U.S. defense industry also brought additional players to
the Gulf Coast. Rolls-Royce Naval Marine in Pascagoula makes $650,000
propellers for Navy ships at a foundry in Pascagoula, and has designed the
facility a center of excellence. Defense conglomerate Singapore Technologies
Engineering, which owns aerospace company ST Mobile Aerospace
Engineering, entered the shipbuilding sector when Friede Halter Goldman got
into a deep financial jam, was forced into bankruptcy and began selling off
pieces of the company. STE’s Vision Technologies purchased the FHG yards in
Mississippi and renamed them VT-Halter Marine.
...Just across the state line Australia’s Austal Limited entered a joint venture
with Bender Shipbuilding to set up Austal USA on the banks of the Mobile
River. Bender has since sold off its interest to Austal.
Texas and the tip of Florida. But within that large crescent most of the major
shipbuilding operations are concentrated in a 200-mile area between New
Orleans and Mobile. It has four of the nation’s nine active yards: Bender
Shipbuilding and Repair Co. Inc. in Mobile, Ala., Northrop Grumman Ship
Systems’ Ingalls Operations and VT-Halter Marine Pascagoula, both in
Pascagoula, Miss., and Northrop Grumman Ship Systems’ Avondale Operations
in New Orleans.
...In addition, four of the seven Gulf Coast shipyards with build positions are in
two adjacent counties: Alabama Shipyard and Austal USA, both in Mobile
County, Ala., and Signal International LLC – East Yard and VT-Halter Moss
Point, both in Jackson County, Miss.
...This focus on shipbuilding has been a way of life for a long time in this region
of the country, beginning with the first European settlers. In World War II,
Alabama Drydock and Shipbuilding Co., Gulf Shipbuilding, Ingalls Shipbuilding
Corp., Delta Shipbuilding and Avondale Marine Ways were among the U.S.
shipyards that produced 4,600 ships for the war effort. Ingalls by June 1945 had
built more than 70 ships.
...Today the Gulf Coast continues to have a strong base of major shipbuilders
and a large slate of smaller shipbuilders, as well as an array of vendors. But the
region’s shipbuilding industry is far different than it was in the ’80s or ’90s.
Companies that once existed are no more, new players have come into the
region and shipyards that once competed for contracts are now under the same
corporate umbrella.
...One of the new shipbuilders in the Gulf Coast is Los Angeles-based Northrop
Grumman, which through a series of acquisitions beginning in the mid-1990s
went from an also-ran in the defense industry to No. 3 behind Lockheed Martin
and Boeing. It became a major player in the shipbuilding industry with the
purchase of Litton, which owned a yard in Pascagoula and New Orleans, and
Newport News Shipbuilding in Newport News, Va.
...Foreign interest in the U.S. defense industry also brought additional players to
the Gulf Coast. Rolls-Royce Naval Marine in Pascagoula makes $650,000
propellers for Navy ships at a foundry in Pascagoula, and has designed the
facility a center of excellence. Defense conglomerate Singapore Technologies
Engineering, which owns aerospace company ST Mobile Aerospace
Engineering, entered the shipbuilding sector when Friede Halter Goldman got
into a deep financial jam, was forced into bankruptcy and began selling off
pieces of the company. STE’s Vision Technologies purchased the FHG yards in
Mississippi and renamed them VT-Halter Marine.
...Just across the state line Australia’s Austal Limited entered a joint venture
with Bender Shipbuilding to set up Austal USA on the banks of the Mobile
River. Bender has since sold off its interest to Austal.
...Although the nation’s major shipbuilding industry has been shrinking, the Gulf
Coast to a large extent has managed to hold its own. And because is has, its
proportion of the major shipbuilding pie has increased.
...It’s now the location for nearly 40 percent of shipbuilders and the work force.
...The Department of Transportation’s Maritime Administration tracks the
shipbuilding sector in five regions: The East Coast, West Coast, Gulf Coast,
Great Lakes and non-CONUS areas. Over the years the numbers have shown
the nation’s major shipbuilding sector is shrinking. Nearly every region has lost
companies and employees.
...Figures show that between 1982 and 2005, the number of major shipyards
and repair facilities nationwide declined 25.4 percent – from 110 to 82 – while
the number of workers tumbled by 58.8 percent – from 112,500 to 46,300.
...The regions that suffered the biggest losses were the East and West coasts.
...The East Coast in 1982 had 41 shipyards, but by 2005 that figure had
dropped to 27 yards, a loss of 34.1 percent. The number of shipbuilding and
repair jobs also declined, from 63,100 in 1982 to 19,000 in 2005, a staggering
loss of 96.9 percent. (chart)
...The West Coast also took a huge hit, going from 27 shipyards in 1982 to 15
yards in 2005, a loss of 44.4 percent. The work force slid as well, going from
23,700 workers in 1982 to 7,700 in 2005, a 67.5 percent drop.
...By contrast, the losses on the Gulf Coast among major shipbuilding and repair
yards were much smaller. In 1982 the Gulf Coast had 33 yards and in 2005 it
had 31 yards, a loss of just over 6 percent. The work force slipped as well, from
22,900 in 1982 to 18,200 in 2005, a drop of 20.5 percent – small compared to
the other two big regions.
...The result was that the Gulf Coast became a bigger player in a smaller field.
...In 1982, the East Coast had 37.3 percent of the big shipbuilding yards, the
Gulf Coast 30 percent and the West Coast 24.5 percent. By 2005, the Gulf
Coast had increased its proportion to 37.8 percent, while the East Coast slipped
to 32.9 percent and the West Coast fell to 18.3 percent.
...The same type of shift occurred with the workforce. (chart)
...In 1982 the East Coast had well over half the work force with more than 56
percent, followed by the West Coast’s 21 percent and the Gulf Coast’s 20.3
percent. By 2005 the East Coast still had the most workers with 41 percent,
followed by the Gulf Coast with 39.3 percent and the West Coast with 16.6
percent.
Coast to a large extent has managed to hold its own. And because is has, its
proportion of the major shipbuilding pie has increased.
...It’s now the location for nearly 40 percent of shipbuilders and the work force.
...The Department of Transportation’s Maritime Administration tracks the
shipbuilding sector in five regions: The East Coast, West Coast, Gulf Coast,
Great Lakes and non-CONUS areas. Over the years the numbers have shown
the nation’s major shipbuilding sector is shrinking. Nearly every region has lost
companies and employees.
...Figures show that between 1982 and 2005, the number of major shipyards
and repair facilities nationwide declined 25.4 percent – from 110 to 82 – while
the number of workers tumbled by 58.8 percent – from 112,500 to 46,300.
...The regions that suffered the biggest losses were the East and West coasts.
...The East Coast in 1982 had 41 shipyards, but by 2005 that figure had
dropped to 27 yards, a loss of 34.1 percent. The number of shipbuilding and
repair jobs also declined, from 63,100 in 1982 to 19,000 in 2005, a staggering
loss of 96.9 percent. (chart)
...The West Coast also took a huge hit, going from 27 shipyards in 1982 to 15
yards in 2005, a loss of 44.4 percent. The work force slid as well, going from
23,700 workers in 1982 to 7,700 in 2005, a 67.5 percent drop.
...By contrast, the losses on the Gulf Coast among major shipbuilding and repair
yards were much smaller. In 1982 the Gulf Coast had 33 yards and in 2005 it
had 31 yards, a loss of just over 6 percent. The work force slipped as well, from
22,900 in 1982 to 18,200 in 2005, a drop of 20.5 percent – small compared to
the other two big regions.
...The result was that the Gulf Coast became a bigger player in a smaller field.
...In 1982, the East Coast had 37.3 percent of the big shipbuilding yards, the
Gulf Coast 30 percent and the West Coast 24.5 percent. By 2005, the Gulf
Coast had increased its proportion to 37.8 percent, while the East Coast slipped
to 32.9 percent and the West Coast fell to 18.3 percent.
...The same type of shift occurred with the workforce. (chart)
...In 1982 the East Coast had well over half the work force with more than 56
percent, followed by the West Coast’s 21 percent and the Gulf Coast’s 20.3
percent. By 2005 the East Coast still had the most workers with 41 percent,
followed by the Gulf Coast with 39.3 percent and the West Coast with 16.6
percent.
| The regions |
| The Gulf Coast region |