Navy officers suggest cuts will reshape shipbuilders

Naval Sea Systems Commander Vice Adm. Phillip Balisle Thursday indicated that the Navy's shrinking plans for building new ships will result in "the shaping of a new shipbuilding industry."

Balisle spoke to a Surface Navy Association conference and then told a news conference that: "I believe the laws of commerce will drive much of the shaping of what that industry will look like. The critical thing for the nation is not the number of yards, or which yard; the critical thing for the nation is the capabilities and capacities embedded in those yards."

As long as the Navy has the capability to build the ships it needs at affordable prices, "I think the laws of economics will determine for us just which yards should be there, what size, what shape," he said. "They will shape themselves to be good businesses."

Balisle's comments and similar ones from several of his program executives followed remarks Wednesday by Chief of Naval Operations Adm. Vern Clark that successful tests in swapping crews of ships while they are deployed mean the Navy will need fewer ships to meet its commitments.

The Navy has indicated in recent months that it will reduce the number of ships it plans to buy, including building only nine of the San Antonio-class of amphibious ships instead of the anticipated 12, and considerably fewer of the Littoral Combat Ships than the 65-75 Clark has talked about in the past.

More recently, leaked budget documents indicate that President Bush's fiscal 2006 budget, to be released in early February, will force the Navy to reduce or delay the purchase of several planned ships and submarines.

The shipbuilding industry and its congressional supporters have warned that even existing construction plans would not sustain the six major shipyards that are almost totally dependent on Navy business.

When asked if the reshaping would lead to only one shipyard for each major type of ship, Balisle said: "We always want competition, we want affordability. So we're anxious to have the opportunity to make our ships as affordable and as economically feasible as possible. But the truth of the matter is, as long as the capability is embedded nationally that we need to build the Navy and we are postured to be able to do good business, then I think the arrangement that ultimately results would work fine for the nation and work fine for the Navy."

Currently two major yards compete for contracts to build submarines and surface combat and amphibious ships.