GULFPORT, MS (WLOX) - Uncertainty about Northrop Grumman's future has the Navy concerned. That's according to an Assistant Secretary of the Navy who toured Northrop's Gulfport and Pascagoula sites on Friday.
Assistant Secretary Sean Stackley says the Navy wants to beef up its fleet from 288 ships to 313, as well as replace some of its aging vessels. But Northrop Grumman's plans to close down one shipyard and possibly sell others have made negotiations for future contracts very intense.
Workers at Northrop Grumman's Ingalls shipyard in Pascagoula are part of the region's skilled labor force Stackley says is critical to maintaining a strong fleet.
"Half of our destroyers, three quarters of our cruisers and all of our amphibs were built here on the Gulf Coast. They have served our Navy well," Stackley said.
Right now Stackley says the Navy and Northrop Grumman are at the negotiation table concerning five different ships but their positions are far part. Price is a sticking point and the Navy wants the company to answer questions about the impact of closing Avondale and consolidating to Pascagoula.
"We are mindful that Avondale has been an important part of the Navy's industrial base for the past 75 years. We look at what they have brought to the Navy in terms of building auxiliary ships and now amphib ships and we do concern ourselves that if Avondale were to be closed that we would lose an element of competition for future auxiliary ships," Stackley said.
Stackely says from the time materials are ordered to the time a ship is delivered is about five years. If the Navy signs contracts with Northrop Grumman now, there is no guarantee it will be the same company that builds the vessel.
"They're looking at exiting shipbuilding. When you're in the middle of negotiating a significant contract, and the contractor you're negotiating with has made a critical business of that nature, that's adding some complexities to your negotiations that we have to work through," said Stackley.
"So we've got to have a clear understanding when Northrop Grumman says they may be exiting shipbuilding how that affects that contract that they'll be signing with the Navy. "We're signing a contract with a company that may not be executing that contract."
Assistant Secretary Sean Stackley says the Navy moved up its time line for replacing its aging oilers by several years. He says the government wanted to let companies interested in buying Avondale know they would have the opportunity to compete for those contracts.