HII warns of potential carrier, amphib issues in FY25 budget request

ARLINGTON, Va. — HII is bracing itself for two big challenges in the Pentagon’s next budget request: the likelihood that money won’t start flowing for the next aircraft carrier as early as industry needs, and the potential for an extended pause in amphibious ship production, the company’s chief executive said.

Chris Kastner told reporters Monday that the Navy should adopt a 2-3-4 strategy for aircraft carriers: Buy two at a time, with three years of advanced procurement funding for each, spaced four years apart.

This plan, he said, would optimize construction at the company’s Newport News Shipbuilding yard in Virginia and benefit thousands of suppliers.

The Navy in 2019 simultaneously bought its last two carriers, the Enterprise and the Doris Miller, with hull numbers 80 and 81, respectively.

The Navy’s plan for CVN-82, as explained in FY24 budget materials, was to begin its advanced procurement in FY26 and buy the carrier in FY28. That’s a longer interval between ships than the company wants, and a year less advanced procurement than it wants.

HII’s concerns grew after Defense News reported in October the Navy was considering whether to ink its next two-carrier contract in FY28, FY29 or FY30. The Navy will reveal its decision on the timing of the contract in FY25 budget materials.

A Newport News Shipbuilding executive, who spoke to reporters Jan. 8 on background, called the potential delay “extremely disappointing.”

“For several years now, CVN-82 has been projected to be a 2028 awarded ship, and the nuclear-industrial base has been planning around that timeline,” the executive said, even though it’s a year or two later than the ideal cadence would call for.

The supply base is worried that a lack of advanced procurement funding in FY25 could lead to some production lines going cold, the executive said.

But if they see further delays — if the contract is pushed back to FY29 or FY30 — “recent analysis and surveys by the Aircraft Carrier Industrial Base Coalition, or ACIBC, suggest that delaying CVN-82 would also result in supplier workforce layoffs, increased costs, and ultimately suppliers deprioritizing military shipbuilding and exploring alternative business opportunities.”

Kastner said the Navy has a chance to give the industrial base some certainty.

“We know the ships are going to be built; they have broad support. So let’s eliminate risk. Let’s get the major suppliers under contract early enough so they can plan and they can make their production schedules,” Kastner said.

“I think there’s a broad understanding of that,” he added, but “the budget is driving discussions around potential delay. One thing we should never delay is the advanced procurement of major equipment in the supply chain.”

Kastner also discussed ongoing uncertainty about the production line for the San Antonio-class amphibious transport dock. The Pentagon tried to halt the production line in its FY24 budget plans and called for a “strategic pause” to consider the future need for amphibs, how many the Navy should have, if there was a cheaper design industry could build, and other factors.

Pentagon leaders still not released the results of any of these studies.

Congress, which has already passed a 31-amphib ship requirement into law, rejected the pause and included the next ship in the program, LPD-33, in the FY24 National Defense Authorization Act. Kastner said he is optimistic funding for the ship will come in a spending bill currently being hashed out by lawmakers.

Kastner told Defense News he has not been briefed on the results of the amphib study and is awaiting details, expected to be revealed in FY25 budget materials.

Kastner also said he is confident that, even if the Pentagon determines it must move to another design, HII will continue to play a role in building some kind of amphibious ship. Its Ingalls Shipbuilding yard in Mississippi is the sole builder of amphibs.

He noted the Navy had threatened to end the program several times and that many recent LPD ships were excluded from formal budget plans, only to be added in by lawmakers after advocacy from industry, the Marine Corps and other supporters.

“We’ve been in the position of supporting [the next LPD’s addition to the budget] every year. And now it’s really broadly supported by the Navy, by the Marines, by the Congress,” Kastner said. “So we understand the process and the realities of supporting every year. It’s something we’ve been able to do, and we’ll continue to do that.

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