Huntington Ingalls wins $1.5 billion Navy contract
PASCAGOULA, Miss. -- Huntington Ingalls Industries Inc. has been awarded a $1.5 billion final construction contract by the U.S. Navy to build the 10th LPD 17 class amphibious transport dock ship LPD 26, Ingalls and the Navy announced today.
Work will be performed primarily in Pascagaoula.
The news caps an exciting and emotional week for the shipyard, which one week ago Saturday christened Arlington, the third Navy amphibious assault vessel named to honor the victims of the Sept. 11, 2001.
On Thursday, Northrop Grumman Corp.'s shipbuilding sector officially parted ways with the defense contractor to become Huntington Ingalls and started trading on the New York Stock Exchange under the symbol HII.
The name combines that of the founder of Virginia's Newport News Shipbuilding, Collis P. Huntington, and the Ingalls family of Birmingham, which founded the local shipyard in 1938.
The new ship will be named USS John P. Murtha.
Construction is expected to get under way in May. Irwin F. Edenzon, corporate vice president and general manager, Gulf Coast Operations, said the contract will keep 1,500 people employed over the next four years and help minimize "long-term impacts to the workforce."
Mississippi's largest employer, the HII's Pascagoula operation employs about 10,800 people.
"This is the first contract awarded to our new company, and our shipbuilders are excited about continuing the LPD product line," Edenzon said.
About San Antonio-class ships
Dimensions: 684 feet long, 105 feet wide
Displacement: Approx. 25,000 tons
Principal mission: To deploy and the combat and support elements of Marine Expeditionary Units and Brigades.
Capacity: Carries to 800 troops , as well as aircraft such as helicopters
Source: Huntington Ingalls Industries
The focus, he said, will be on safety, quality, cost and schedule.
"We've been working hard for the last three years making some changes and focusing on important process improvements," Edenzon said. "I am confident that LPD 26 will be a great ship, and that is our commitment to the sailors and Marines who will serve on her."
Ingalls workers are currently putting the finishing touches on Arlington, and building LPD 22 San Diego, set for sea trials this summer, Edenzon said.
Even with nearby companies like Mobile's Austal USA landing more work and adding potentially thousands of workers, Edenzon said he's confident Ingalls will be able to recruit and retain a skilled workforce.
"We look out at our labor resources at least five years in advance of when we're going to need it for our contracts," he said. "Our training, relationships with community colleges and career days at the company and local high schools help ensure we have an available, skilled workforce," Edenzon said.
"We feel like we can compete with anybody on the Coast."
Ingalls workers earn slightly more than $20 per hour on average.
The Navy gave the spin-off its seal of approval in mid-March, with the announcement that it had reached an agreement with Northrop Grumman to move forward with contracts for LPD 26 and DDG 113.
Conditions included Northrop agreeing to relieve Huntington Ingalls first-quarter 2011 debts, providing a starting cash balance of $300 million, and reimbursing performance incentives and economic price adjustment payments owed by the Navy.
"The announcement that the company has been awarded billion and a half dollar contract to keep 1,500 to 2,000 jobs in south Mississippi is good news," Rep. Steven Palazzo, R-Biloxi, said Friday evening as he boarded a plane to return home from Washington for the weekend.
"I am committed to doing whatever I can do for the shipyard to make sure uncertainly for future contracts is removed .... and continue to drive the costs down so the Navy will produce more ships."
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