Navy secretary tells Congress U.S. shipbuilding programs ‘a mess’

Navy Secretary John Phelan told House lawmakers that he didn’t have good news to share about the state of America’s shipbuilding industry.

He testified Wednesday before the House Armed Services Committee on the Navy’s 2026 budget request alongside Adm. James Kilby, the acting chief of naval operations, and Gen. Eric Smith, commandant of the Marine Corps.

“All of our [shipbuilding] programs are a mess, to be honest,” Mr. Phelan said. “We are behind schedule and over budget.”

The best program is six months late and spending 50% more than planned. The Navy secretary said he’s meeting with officials from U.S. shipyards to get them moving, especially for critical weapons systems like the Columbia- and Virginia-class submarines. 

Rep. Mike Rogers of Alabama, the GOP chairman of the committee, agreed that the maritime defense acquisition system is broken.

“As a maritime nation, our naval capabilities are central to our ability to deter our adversaries, especially China. We can’t do that without growing the surface and submarine fleet,” he said. “But when it comes to shipbuilding, we remain woefully behind schedule and way over budget.”

Mr. Phalen said he is exploring whether foreign shipyards can fill the gap in the short term.

“I’ve got to get hulls in the water, and so that means all options are open,” he said. 

The Navy chief said the long-term answer requires reinvigorating the nation’s domestic maritime industrial base.

“We have to probably expand shipyards. We probably need to open new shipyards as well,” Mr. Phelan said.

The top Democrat on the House Armed Services Committee said Navy shipbuilding is one of the most challenging areas of the Defense Department’s procurement activities.

“It is hard to point to a shipbuilding program that is performing on cost and on schedule,” said Rep. Adam Smith of Washington State. “I recognize that our shipbuilding industry has been hit with a variety of challenges, such as COVID and supply chain instability, but we must find a way to manage through those challenges.”

Building and maintaining a labor force in the nation’s shipyards is also increasingly difficult because experienced builders are retiring, and the companies are forced to rely on junior workers, Mr. Smith said.

“We should address this by taking a hard look at what the proper wage is for shipbuilders, so that we can  not only attract the right workers but also retain them.”