Northrop Grumman Head Pushes to Avoid Delay

Wednesday, October 19, 2005
BY PETER DUJARDIN Northrop Grumman Chairman and CEO Ron Sugar said in a visit to the Newport News shipyard Tuesday that the yard has made improvements in meeting cost and deadline targets. The yard's performance on aircraft carriers and submarine construction contracts has become an issue, with costs having risen both on Virginia class submarines and the George H.W. Bush aircraft carrier. Improving such performance has been a priority of shipyard President Mike Petters, who's been on the job since last year. "We're in the middle of a great trend here," Sugar said on the flight deck of the USS George Washington aircraft carrier. "Is there room for improvement? Of course. But we're going to continue to push hard on that." Sugar spoke to thousands of workers Tuesday, met with union leaders and attended a reception with community leaders at the Mariners' Museum in Newport News. Then he was off to South Hampton Roads for a visit with company employees and military customers. During his flight deck talk, Sugar said the company is working to avoid a delay in the start of the nuclear refueling and overhaul job on the USS Carl Vinson. The job, which already has been delayed a year, is scheduled to start in November. But the 2006 federal Defense Department budget, which contains the bulk of the money to pay for the Vinson job, hasn't passed Congress. In addition, the House and Senate versions of the bill are $193 million apart on how much money should go toward the Vinson. Without the congressional funding, the Navy typically doesn't start a project. But Petters said the yard is finding "all the alternatives that we can put on the table" in an effort to get the job started in November. Sugar said the company also sees a priority in getting the next generation aircraft carrier, the CVN-21, started on time in 2007, and in getting the country to buy two submarines a year, rather than the current one. Sugar said it is important to the shipyard industrial base that the Navy and Congress decide on a firm shipbuilding plan rather than going from year to year with wide jumps in how many ships are bought. "One of the things that would be very helpful for us is to have a clear sense of the Naval force structure and therefore the shipbuilding requirements as we look over the next 5-10 years," he said. "Then we can make the capital investments necessary to do the work, and we can establish the manpower level." Source: Hampton Roads Daily Press

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