How a 221-year-old shipyard is leading a US Navy modernization effort

KITTERY, Maine — When first U.S. Navy Secretary Benjamin Stoddert established the Portsmouth Naval Shipyard in 1800 on a cluster of islands in the Piscataqua River, the Navy had purchased its first six frigates and wanted its own shipyard to construct wooden-hulled, sail-powered ships.

The work has changed dramatically since then — from building steel ships to building conventional submarines to maintaining nuclear-powered submarines — but the yard’s layout has only become less optimal.

“If you had to build a shipyard from scratch, and you were given an empty island, it wouldn’t look anything like this,” Portsmouth Naval Shipyard Commanding Officer Capt. Daniel Ettlich told Defense News in a Nov. 15 visit.

After making do for so long — including spending 20 years on a series of mini-projects to consolidate work — the yard, which now specializes in repairing and modernizing Los Angeles- and Virginia-class attack submarines, is finally getting a chance to more thoroughly revamp how people and materials flow through it. The service will undertake the effort through its Shipyard Infrastructure Optimization Program, dubbed SIOP.

SIOP is meant to address the wide range of challenges Portsmouth Naval Shipyard faces, from its layout to historical preservation requirements to odd tidal patterns that limit access to the dry docks. If successful, Ettlich said, mechanics would be empowered to do their work with reliable tools, in shops with all the right materials on hand, and in a shipyard designed to make it faster and easier to manage ship repair and modernization.

The need for a SIOP program office

In spring 2018, the U.S. Navy announced a 20-year, $21 billon effort to modernize and optimize the four public shipyards: Portsmouth Naval Shipyard in Maine; Norfolk Naval Shipyard in Virginia; Puget Sound Naval Shipyard and Intermediate Maintenance Facility in Washington; and Pearl Harbor Naval Shipyard and Intermediate Maintenance Facility in Hawaii.

The Navy initially struggled to fully explain the need for SIOP and convince Congress this was more than a typical military construction project. But some key lawmakers now think the Navy should be investing more to move faster.

The service on Sept. 30 submitted to lawmakers a five-year plan that outlines early dry dock improvement projects and the planning efforts that will shape shipyard layout decisions. Rather than each of the four yards fending for themselves, as was done in the past, Capt. Warren LeBeau leads a SIOP program office set up in 2018 to integrate the whole effort. In September, the service elevated the effort, appointing Rear Adm. Troy McClelland to serve as a flag-level program executive officer.

Portsmouth Naval Shipyard is an example of how challenging it can be to make a yard more efficient without the support of the bigger Navy enterprise.

Ettlich said the yard spent much of the last 20 years trying to make small improvements on its own. After creating a spaghetti diagram to show the flow of materials coming off a submarine, going through the overhaul process and then being put back onto the submarine, it was clear excessive movement was wasting time and effort. He said multiple shops — some within the controlled industrial area (CIA) and some outside those gates — were doing almost identical work, which needed to be consolidated into a single structural shop.

“Ultimately, over the course of about 20 years and a bunch of different projects, we consolidated all that down” to a single area, Ettlich said.

“The challenge is it shouldn’t take you 20 years and a lot of creativity and hoping everything falls into place the way you want it to so that you ultimately get the ‘we’ve arrived’ solution, right?” he added. “Hence the program of record, a program office for SIOP within the Navy, that then can set priorities, can allocate funding and ensure that the sequence happens in the way that it should, in order to get the outcome we want without heroics and a glacial amount of time.”

Among the four yards, Portsmouth was the first to tackle upgrading dry docks, something the yard was already planning that was later incorporated into SIOP. At Portsmouth, which is in the midst of upgrading its Dry Dock 2, the service is already learning lessons in Maine about the complexity of upgrading a dry dock while it’s being used to conduct a submarine maintenance availability — Ettlich said the yard is full today and will be full for the foreseeable future, with no bandwidth to leave dry docks empty during their upgrades.

For example, as one side of the dry dock was torn up while the crane rails were replaced, the work site effectively blocked off the other half of the dry dock from the single access point into the controlled industrial area.

On the submarine maintenance side, “we had to fundamentally change how we ran the project because we only had access to one side of the boat,” Ettlich said. On the construction side, they realized they’d need to rethink some activities to allow sufficient access to the submarine.

Ettlich and LeBeau said these lessons will be critical to the other three yards as they plan and execute their own dry dock modernization efforts. Pearl Harbor is next in line to conduct a complex dry dock overhaul amid ongoing sub maintenance work.

The Navy has learned that, for these longer projects taking place in the midst of ship repair activity, “we’re going to have to build the project almost around maintenance. And, for example [in the Pearl Harbor dry dock renovation, currently in the planning phase], we are including funding for more security to take care of the additional gates that we’re talking about and the impact to the fence line. There’s a whole system of systems, not just building the dry dock” in a vacuum, LeBeau said.

The five-year SIOP document, obtained by Defense News, says the project at Portsmouth had “significant growth in the cost estimates” due to pandemic-related labor and material disruptions as well as construction interruptions due to ship repair activities, increased project complexity, and therefore limited interest from potential bidders. That said, the Navy writes in the document, it now has greater confidence in its estimates for follow-on projects after going through this first one.

“You don’t start with a lesson learned, you start with a risk or a problem that occurred that you found a solution to. Once you’ve captured that, you’ve now had lessons learned,” LeBeau said.

“There’s going to be an incredible amount of lessons in sequencing those investments, and so I think Pearl Harbor and Portsmouth are the two that are kind of out there and we’re going to learn an awful lot,” he added. “We have those programmatic tools in place to capture that and expand those out to the other yards.”

The quirks of Portsmouth Naval Shipyard

Each of the yards has its own features that will shape how SIOP plays out: Norfolk is the oldest and largest of the four yards, conducting all the East Coast carrier work and helping maintain both attack subs and the larger ballistic missile subs. Puget Sound is the only West Coast yard and handles all three ship types as well. Pearl Harbor sits alone in the middle of the ocean and contributes to surface ship maintenance too, in addition to working on subs.

As for Portsmouth, dubbed the center of excellence for attack submarine maintenance, modernization and repair, its location is really working against it — which can partly be mitigated by SIOP.

One issue is the tides. Ettlich said it takes a “super-high astronomical tide” to get subs in and out of Dry Dock 1, the shallowest at the yard. “If this high tide happens at 2 in the morning in a sideways sleeting snowstorm, that’s when we’re gonna go do it,” he said.

Even with that high tide, the subs require buoyancy assist, which involves sending divers into the water to attach floating devices to the boats and help lift them higher out of the water. Due to some of the strongest river currents in the nation, those divers are limited in when they can go in the water.

Ettlich said submarine Santa Fe undocked on Dec. 14, 2019; if it wasn’t able to undock that exact day for any reason, conditions wouldn’t have allowed for an undocking again until April 2020.

“You’re talking about a big miss if you miss it,” he said.

SIOP will be able to address this, adding a super flood basin around Dry Dock 1 that essentially decouples the dry dock from the river around it, allowing the yard to raise or lower the water level in the basin.

Another challenge is being on an island. Ettlich said the island is about 300 acres, with the controlled industrial area taking up about 90 acres. The yard has been so pressed for space in the past that Dry Dock 2 now hosts a six-story building.

“We know what size submarines we work on — so we built a building in the front of the dry dock to take care to better utilize that space. So a giant six-story building [is] called the Head-End Building, because it’s at the head of the dry dock,” he said. The Head-End Building will be knocked down under SIOP so that Dry Dock 2 can be upgraded to accommodate the longest-yet attack submarines, the Block V Virginias.

Still, Ettlich said he’s confident the yard can work with the physical space it has, especially if the optimization process consolidates work and makes better use of the space. Though the 6,600 employees today doing 900,000 man-days of work a year is much higher than in recent years — 5,600 employees in 2016 and 4,600 in 2011 — the yard has actually been busier at other times in its history, including at the height of the Reagan-era fleet buildup, he said.

The real challenge, he said, is filling those jobs.

Located at the border of Maine and New Hampshire, “what we found is most mechanics aren’t relocating from outside of the states. So you’re looking within the commuter area,” which means a full-court press recruiting at local community colleges as well as trade schools and high schools.

With other manufacturers in the area and shipyard Bath Iron Works just over an hour north, Ettlich said “we’re trying to reinvent ourselves and what we can offer, and [consider] how do we stay competitive to attract top talent.”

Early SIOP efforts

Though SIOP is expected to span two decades, there’s an urgency to some of the first steps in the program.

The dry dock work is time-sensitive: there are submarine and aircraft carrier maintenance availabilities on the books with no dry docks that can support that work. Puget Sound, for example, is supposed to conduct the first availability for Ford-class carrier John F. Kennedy in fiscal 2034, and the dry docks there cannot accommodate the carrier’s power and cooling requirements. Portsmouth faces the earliest deadline, with the yard planning work on Virginia-class boat California in FY26 that requires the overhaul of Dry Dock 1.

Beyond the dry dock work, the SIOP program is developing a digital model of all four yards. The Navy has completed 3D models of each yard, but still needs to combine that with the results of dozens of engineering studies — on things like environmental issues, predicted climate change effects and underground surveys — and detailed models on how each shop and piece of gear operates, to create a finely tuned digital twin of the yard.

With this digital twin, the Navy will be able to generate potential layouts and determine the optimal work flow. The five-year plan notes this digital twin will identify bottlenecks, optimize shop layout, measure equipment utilization, compare the costs of investing in innovative new equipment with potential savings, improve schedule and financial planning and more. Once a new layout, or area development plan, is settled on, the Navy could decide how to break that into discrete projects and when to schedule them based on budgetary considerations as well as the maintenance activities taking place in tandem.

Though this early work is relatively straightforward, much of the work that will follow in the remaining 15 or so years will be complicated by the fact that there’s no long-term funding mechanism for SIOP. That makes it something of a gamble to start overhauling a yard without a guarantee of sufficient and timely funding in the future.

The SIOP effort is also, to some degree, tied up with a related Naval Sustainment System-Shipyard (NSS-Shipyard) effort to improve processes at the public yards. With both initiatives still relatively new, it’s unclear how one’s outcome could affect the other.

Ettlich noted the complexity of handling both at the same time, telling Defense News the Navy could optimize its spaces for the way it does business today or it could find a new way of doing business. If it finds entirely new processes for certain ship repair activities under NSS-Shipyard, that could result in a different desired layout under SIOP, for example.

Additionally, the yards are trying to optimize for the next century of work, which means platforms that haven’t hit the water yet and repair technologies that haven’t been invented.

The lead Ford-class carrier has yet to go on its maiden deployment, but LeBeau said enough is known about its maintenance needs to plan for dry dock upgrades at Norfolk and Puget Sound.

“We understand for the Ford-class carrier that our dry docks are large enough, but they don’t have enough power and saltwater cooling. And so those are two upgrades that we’ve worked” to include in plans at Norfolk and Puget Sound, LeBeau said.

The submarine side is much harder: the Navy is already building Block V Virginia-class submarines and thinking to the future SSN(X) next-generation attack sub, but the shipyards are just now getting their first look at the Block III Virginias due to the time lapse between when they hit the fleet and when they’d need their first maintenance availability at a public shipyard.

For submarines, planners will have to use the best information available from the Program Executive Office for Submarines and from industry to design a shipyard that can accommodate the knowns and be flexible for the unknowns.

“One of the tenets that we have with the area development plans is making sure that our facilities are adaptable to future requirements,” LeBeau said. “These buildings are going to be around for 50, 75, 100 years. Our dry docks will be around for more than 100 years.”

“The [chief of naval operations and the secretary of the Navy] have both mentioned that this is a once in a century program. So our requirements need to be thinking that far out as well,” he added.

A money problem

Though the Navy in 2018 made a bold pitch for SIOP — a $20 billion investment that would not only replace aging dry docks and outdated equipment but also generate efficiencies as high as 30% in submarine and carrier maintenance — lawmakers weren’t immediately onboard.

The pendulum now seems to have swung the other direction: some lawmakers want the Navy to speed up the 20-year timeline, partly selected due to the challenge of allocating so much money for shipyard renovations and partly because of the difficulty of overhauling a yard even as it continues to do ship maintenance at a high pace.

By this spring, lawmakers were increasingly pushing to accelerate SIOP by five or 10 years. This fall, House Armed Services readiness subcommittee chairman Rep. John Garamendi scolded the Navy for not fully funding the early planning and dry dock work in SIOP.

“This sends the message that the facility and the equipment optimization is optional,” he said in an Oct. 28 hearing. “But we keep hearing that it is essential. It cannot be both absolutely necessary and essential and then not prioritized on the funding programs.”

Garamendi said he is using the five-year plan to hold the Navy accountable going into FY23.

“We’ll find out what is it that you proposed and then we’ll find out what the [secretary of defense] has actually approved. And if those two do not match up to the expectations of the five-year program that you’ll develop for us, [service leadership] will hear from us. This committee is not messing around,” he said.

The plan outlines $4.2 billion in work over the next five years, primarily for dry docks, which appears to take priority over optimization planning efforts.

“The large amounts of funding required for these DD projects will be a constraining factor for implementation of the optimization strategy under the Navy’s current projection of top-line funding authority over the next five years,” it notes, even as some lawmakers would like to see that planning work sped up.

Already, in fact, “funding constraints have led to a slip in completion” of the area development plans from mid-FY22 to late FY25. “With additional funding, the Navy could accelerate completion of the ADPs” by nearly two years, it adds.

Even as questions remain about the path forward and the funding for SIOP, Ettlich said the plan, put simply, will address a need for speed. When the optimization effort is complete, he said, he wants to see the Navy able to repair ships more quickly.

“That’s really it. It’s all about speed of play,” he said. “How do we spend less time in depot maintenance and more time in operations? So either, A, you do less work, or B, you do it more effectively. So we’re gonna go for do it more effectively.”

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