Transcripts For CSPAN3 Forum Focuses On U.S. Navy Maintenance Challenges 20170612

Facing the navy, marine corps and coast guard. Today represents our second dialogue for 2017, and we look forward to welcome you all back for additional events throughout the year. We would also like to thank in a special way Lockheed Martin and Huntington Industries for their support in making this event really this series possible. Before we get under way, for big events like this, we also like to make a brief announcement, safety announcement. We dont expect any difficulties. But should there be anything as a convener, we want to make sure you know weve got exits on the back on both sides and stairs down the front. Both myself and anthony bell in the back will be your responsible officers to kind of direct you in the right way just in case anything should come up, just look for one of us. And so for our formal introduction to get us started, im going to turn things over to vice admiral peter daley, retired, chief officer of u. S. Naval insitituteinstitute. Were happy to have him here. Welcome. Dont know me, pete daley, ceo naval institute. We are proud to bring you this maritime dialogue series continuation in our third year and as mentioned, we give special recognition to our sponsors, huntington engles and Lockheed Martin for making this event possible. Our speaker for today, 1981 graduate of the academy, also holds degrees from George Washington university, and a Naval Nuclear engineering degree from m. I. T. After serving 13 years as a Nuclear Propulsion qualified Surface Warfare officer, he made lateral transfer to the duty officer community. There he served and focused on refueling, complex overhauls of Aircraft Carriers. Major command include Major Program manager for inservice Aircraft Carriers and Program Executive officer for submarines, peos, subs. Finally last year in june, vice admiral tom moore assumed command as the 44th commander as navc. I point out that there is over 75,000 uniformed and civilian employees of navc. Navc is entirely responsible for the contracting and supervision of all navy ship and sub ship building, and responsible for maintenance and systems that go on those ships directly. So we welcome admiral tom moore who controls onequarter of the navys budget. [ applause ] thanks, pete. Im always reminded of that, by the way, you have onequarter of the budget. Thats not necessarily a good thing. Good morning and thank you for the invite this morning. Last night was a big night for the navy. Couple things. One, my band played down at the waterfront. And then what was the other thing that went on last night . The other thing we delivered the ford to the navy. Kind of a big night for us. Actually from my perspective having worked on general ford for most of the past ten years, just came back from a very successful acceptance trial and board of acceptance survey and navy accepted delivery of the ford last night. You heard it here first. Thanks for the opportunity to come talk this morning. The theme that i was given was the maintenance challenge and how to reset the fleet. So what i would like do is talk about this in kind of the context of where the cno is headed with the size of the fleet. Then talk about what were doing to grow the size of the fleet on the new Construction Side. But then, importantly, talk about how the maintenance side of that equation fits in. As admiral daley and i were talking beforehand, it is not either. You got to do both. So sometimes we tend to forget about that, having been a ship builder for the most of the last 15 years, but willing having spent most of the last year on sea readiness. I am well aware that you got to use what you got and continue to go forward. If you have not read the sea notes on the white paper navy, it is a good read. A short, it has pictures in it. It is great for command master chiefs. Their lips do not get tired when they read it. And the cnos white paper talks about what the current security environment is. He makes three key points. These three points are applicable whether you are talking new construction or whether you are talking maintenance side of the house. The three key points are time matters. There has to be a sense of urgency in some of the things were getting after today. That applies across the board. To figuring out how you design these ships quicker and build them quicker. The pace today is exponential. If you look at the world and the threats that were facing, the learning thats going on in our competitors, say, russia and china, and the pace they are changing their capability is growing exponentially. We have to keep up with that pace. It is like we went into halftime of a Football Game in 2000 up about 283, and kind of popped the champagne, said games over. In fact the referee came in, said halftime, over, were ready to start the second half and we said well get there when we get there. We kind of strolled out midway through the Third Quarter only to find out that the score was now 2824. That capability gap between us and our competitors has really closed and its a really keen interest to us on the navy side of the house in terms of what is the capability we need Going Forward. There is a lot of discussion going on today about what is the navy that we need. Not necessarily what is the navy we need in the 2040s but what is the navy we need in the 2020s . We tend to talk a lot about whats the that ivy we need today. We are trying to take a little bit of a lead angle and figure it out. What is the navy that we need in the mid20s. And go make some decisions based on kind of that navy we need in the 2020s. There have been a number of recent studies some done by the navy, and some by independent groups about what is the navy and what should it look like . They have various mixes of ships and stuff but in the end they all came to the same conclusion we need a bigger navy than we have today and they are all around the 340 to 350 ships. Clearly the size of the fleet does matter Going Forward, and the cape and tability of that f also going to matter. How do we get there . When we talk about the size of fleet and i know ill get questions about how the 18 budget didnt add a bunch of new ships, what happened . We were never going to be able to turn that around overnight. I think what youre going to see and ill get to it later in my remarks is the 18 budget holds what we have on the new Construction Side but makes a significant investment on the readiness side of the house which i think is, if you listen to the vice chiefs testimony back in february, his point was, the first dollar we get ought to go to readiness. I think thats what youre seeing in the 18 budget. We spent a lot of time talking about the strategy, the future navy white paper, it all goes to what the navys strategy is Going Forward. And its easy to say having been in washington, d. C. Now since 1999 i tell people im on my 18th palm which is kind of hard to imagine. If i had a dollar every time someone said we need to build the Strategy First and the strategy will drive the budget. In the world that we live in that sounds great but the reality of it you dont want a budget completely driving your strategy but you cannot ignore the fact that we live in a fiscally constrained environment. What we like to say is we have a resort informed strategy. I think thats the reality of where we are today in the navy budget. We will increase the builds of the ships we have today. We think the Industrial Base can probably build in the next seven years, based on the capacity they have, probably 29 more ships than we had in the original 310ship plan. W we have to get more capability for that dollar. Figure out where the knee is in the curve industry. In terms of the dollar. Have to figure out how to innovate, and what we are going to work on the new Construction Side of the house. We will continue building edgs, the amphibs that we have today. There is ongoing discussion on lcs and the frigate that is still kind of churning around inside the pentagon and we owe some answers to the congress here later in the summer on that. Youll see some things going on in that particular area. As we head out further out and if you heard me talk about this future service combatant, thats going to be critically important as well. The new buzz word inside navc and the pentagon is s. W. A. P. , space, weight, and power. If youve heard me talk about before, we go build the future navy. While i cant tell you exactly what it will look like, one of the things that is real,ly, really important for us as we build these platforms is to make sure the platforms have enough spate, weight and power so you can modernize and adapt to future threats. We are in an age of electric ships and fordclass carriers are prime examples of building in space, weight, and power into the platform so you can adapt and go forward. And interestingly, the ddg 51 class which is around today and serving well, we are going to provide a little bit more space and a little bit more power in that Going Forward and those ships are kind of unique in their ability to stay around. It was interesting, my First Department head was on the uss cunningham we used to get rid of ships around the 25year point. We probably got rid of them at the 25year point. We didnt do maintenance. Anyone who served on a ddg knows they were tough to maintain. But we didnt spend any money at the maintenance side. At the 25year point people would think we need to get rid of these things because theyre rust buckets. The reality is, from a common systems standpoint, they had become obsolete. Fastforward to today, take a look at open architecture and spy radar and vertical launch and now you have a platform that can stay around a lot longer. So now we have to kind of shift the thought process now. Back over to the maintenance side of the house and now, if you want to get more service life for the hull you have to do the maintenance on it. And admiral daley and i when i first became a flag officer in 2008 we had kind of reached this epiphany where we had not spent any money on doing maintenance for about ten years and we woke up one morning and realized we are failing auto these in serves we do not have ships to get to their expected service life. In hindsight, it does not take a Rocket Scientist to realize if you do not make investments on the maintenance side, you cannot expect the ships to get to where they need to get to. We had kind of gone along happily for ten years saying, hey, not doing maintenance and saving on other things is working. The reality is we were consuming the service life of the ships that was built into them and it caught up with us. We spent the last eight to nine years digging ourselves out of that hole. Particularly as it relates to the private center of the service ships, including the ships. One of the key components of getting out to the size of the fleet that we need is taking the ddgs and the cgs and the amphibs we have today and extending the service lives of these ships. Most of them are in the 35 year range. We are taking a pretty close look at what would it take to get them out another five, another ten years. The reality is, for a steel hull, if you do the maintenance, you can get the service life out much longer. And with todays open architecture and vertical launch i think theres great opportunity for us to make the investment. A relatively small investment, to keep the ships around longer than we have today. People say we have never gone with a service ship beyond 35 or 40 years. But i point out all the time, yeah, but we routinely take Aircraft Carriers to 50 years. We consistently do all the maintenance on the Aircraft Carrier to get it to 50 years, so we know how to do this. And i think what youre going to see is were going the take a very serious look at taking the service life of the existing fleet and extending it out five to ten years. If you do that, and you have seen some of the Structure Assessments which gets us to around 355 ships around 2045 if you keep ships at their Current Service lives and build new, we can probably get them to from 35 to another 15 years. Will take a close look at that. One of the things i have consistently pointed out as we look at the new frigate design is we should not design a ship with a planned service life of it 25 to 30 years. It doesnt make any sense. We ought to go plan service lives of 45 years for all of our ships and build into the context, the spate, weight, and power Going Forward. The last thing that i want to talk about is the maintenance side of the house. And resetting the fleet. If you heard the vice chief, he talked about the fact that if i have the first dollar i get new dollar i get needs to go to readiness. The good news is the fy 18 budget has an unprecedented amount of money for readiness. It is about 9. 7 billion in the maintenance accounts to do maintenance on our ships. Thats good. We need that. Although as i tell the folks we have the resources we asked for now its over to us to deliver. It is important that when you talk about maintenance it is not just resources. Im quick to point out its not just about money and not just about adding more people. That cant be the only part of the solution here. Clearly, the 9. 7 billion that we get is going to help us. We need to grow the size of the Naval Shipyards. 33,850 today. We are going to grow it to 36,100. Thats where we need to be to deliver the Nuclear Power ships and submarines on time. Today we are not doing a good job with that. Only onethird deliver on time. Kind of better on the house side with carrier side. But 12 of those 17 submarines are behind and we have to turn that around. And so people will help. Certainly the capacity piece of that is important but its not the only piece of it Going Forward. The Number One Mission priority is the ontime delivery of ships and submarines. And the reason its the number one priority is because of the 235 shipsvy today, about onethird of them at any period in time are not in my control. So to the extent that we dont get them out on time it causes a great stress on the force. There was an article in january or february where a reporter said that the u. S. Navy for the first time did not have an Aircraft Carrier at sea. Since the First Time Since world war i that we didnt have an Aircraft Carrier at sea. That is a startling statement. When you think about it. Part of that is because we were down to ten carriers, but another part of that was because the george h. W. Bush took 13 months when it was supposed to take eight months. It wasnt lost on me that navseas ability to get them out on time is critically important. To resetting the fleet and getting the fleet to the size of the fleet that we need. Back to my original comment, we need more people, but it cannot be only about the people. Theres a couple other things we have to do here. One, ive got to have the capacity to do the work. That gets the people side of the house. And then i have to figure out new ways to train the work force. Kids learn differently than we learned. And the typical time line to get a trained worker by the time you get them in the door to the time they can do something useful is on the ship is about five years. We got to cut that back. And new training methods so we can have someone turn a wrench and do something useful in two to three years versus five years. We have to think differently about how we train the young men and women coming in today because they learn differently than we do. We need to make an investment in the shipyards to get the work done more productively than to day. Many of our shipyards, some of them are several hundred years old. They were designed to ships early 20th century and not set up to handle maintenance the way they should be. We typically, in terms of capit capital, improvements in the yard, we make investments in equipment and replace equipment about every 20 to 25 years. The Industry Standard is 10 to 15 years less than that. I have buildings over a hundred years old that i cant get work done. Weve got to go make a concerted effort to look from an industrial standpoint how to do we set our yards up and we have to make investments in our Naval Shipyards to get work done more productively Going Forward. Finally, youve heard kevin mccoy talk about this many years ago. Weve gotta take the entire Industrial Base into account here. We do have capacity other places when we dont have the capacity to do the work at our yards. And this one concept we talked about ten years ago is something were going to have to take a seriously look at again. Were getting significant help from eb and hi on submarine news for work were going to need Going Forward. We got a lot of challenges ahead of us, but from the maintenance side of the house, im very encouraged where were headed. We got the resources that we need, a Firm Strategy Going Forward and well start delivering ships and submarines on time and take a look at how we extended the lives of ships that we have. That will also be a part of our maintenance strategy. I think when you combine those two things together and that into the build strategy that were going to have, weve got a viable path Going Forward to get to 355 and may in fact be able to get there sooner than we would otherwise get there by just building new. With that, i will conclude my remarks and take a seat here and be happy to take any questions that you might have. Well, thank you for those remarks and for the audience and for our guest speaker, well start with a few questions up here and then open it up. Well get a discussion going and have plenty of interaction. You know, you mentioned, admiral, that theres this tension between readiness today and build for the future, and you can go back all those 18 ponds or whatever you said you worked on, ask that was probably there on the first one and its probably there today. But one thing that sticks out is the gap maybe widened more than four. The fleets have been running at a very high tempo. You didnt mention the fleet response plan, but that made more of the fleet more available for tasking. You alluded to the bilau report. Didnt mention it by name. But have we caught up enough . Back in 2008, 2009, corrections were put in place, but it strikes me that both from a maintenance standpoint and from a need for modernization, things are pretty tightly wrapped and its a pretty tough its pretty tough to catch up. How caught up are we . Are you satisfied . And maybe you dont agree with the premise, but i think its a particularly challenging scenario. Well, i think we have made major gains to catch up. I dont think weve completely dug ourselves out of the hole. And we have some numbers over here, i think they would tell you that the recent trends on this is a graded event. Graded event, okay. I think weve closed the gap. Were almost there, but its one of those things that as we saw before, if you dont once you get there, if you dont then consistently maintain the funding that you can rapidly lose the edge that you had. And i think thats particularly important when you talk about the ofrp, because ofrp was built and they put maintenance at the front for a reason. It was in recognition that you gotta get the maintenance debut. So were off doing that, but i think the other thing about ofrp, and were having these discussions, the ofrp was designed really to provide more force. So youll hear admiral davis talk about it. Its designed to do a couple things, reset the force, provide Power Forward in a rotational manner, but its also meant to provide surge capacity. And i think we havent you know, we havent yet tapped into the surge piece of it. And were likely to see more use of, for instance, an Aircraft Carrier when shes in a 36month cycle if she has a sixmonth maintenance availability, and then she works up for eight to ten months, you know, shes got a significant period of time. You send her on a sevenmonth deployment and come back, wed like to continue to use her again. I think were going to go look at, you know, weve made the investment in the maintenance, were going on get the use out of the platforms. But as you go use the platforms, youll consume the service life out of them and it circles back to the importance of your point at the beginning, okay, were going to go use ofrp the way it was meant to be used and make the forces available, then it makes it even more important to go do the maintenance. Because theres a direct correlation between how much you use them and how much maintenance you have to do. One of the interesting things we found, in the post 9 11 era, even though the total number of steaming days of the fleet didnt change dramatically, but 40 more deployed days than we had before. Its like running your car across church or across country. We were running the car across country more often and had to do more maintenance on it. You mentioned that thank you for that the shipyards and need to recapitalize a lot of that infrastructure. You can go up to kittering, maine, and see buildings that are over 100 years old. So if thats important, is there money budgeted for the recap . You mentioned that you got maintenance money. Are you allowed to apply that to efficiencies and upgrades to the facilities and the capacity you have . I have limited authority to take the yeoman money to do that. One of the things ive been working at and had serious discussions and frankly defense committees have been very open about having a discussion about providing more flexibility on that . With some controls on the use of that money to make some of the investments we need. On the same side, the milcon side of the house, its always relative to the rest of the budget relatively small. We need to compete for those dollars as well. And were laying out a longterm Investment Strategy for the Naval Shipyards. They specifically asked me, whats the plan . This gets back to my original comment, which is were just throwing more money and people at the problem by itself is not going to make us more productive. It will help, but theres a number of other elements to the productivity piece and one is making the necessary investment in capital equipment, in welding machines, et cetera, but also in providing shops that are if you go and get your work done, that it flows the materials flows into the work into the ship better than we do today. One, we dont make the investments we need to make today. Thats pretty clear. We meet the 6 threshold mandated by congress, but thats kind of a hold what you got and well have to take a serious look at what it takes to invest in the shipyards particularly to grow the size of the fleet. The Naval Shipyard today can handle the 275 ships, but if youre talking dried option shops and throughput for 355 ships in the navy, now you have completely a different issue. I agree. But just to get back to capacity issue, you have a lot of folks out here who are working in industry. Youve highlighted your remarks that the 18, as far as the next proposed budget, it came down on focusing nearterm readiness. Makes sense to a degree, but there was a lot of people who were expecting a little bit more. Its the same number of ships in the ship count for 18 as there were in previous administrations budget. Are there things that you are looking at . And are there things that industry should be looking at as you lay in for the ramp up to 355 . So 18 is a readiness year, but what should they be looking at . I think that Going Forward, weve laid out where we want to head. I would tell industry the key is, we want to keep our production lines going. We want to, with the new frigate or future service combatant, we need to look at ways to stream the acquisition process. The new buzz word is set base design is a way to kind of take the options and get through the early stages of what the design of the ships are going to look like. I think industry is partnering well with us in that area. But its going to be a combination of continuing to build dg51s and innovating and figuring out how we can build quicker for the next set of ships that are going to come down the pipe. Were continuing Building Four class carriers. Wed like to get to 12. That would change build centers from five to four. Thats one of the things were looking to do. And on the service side of the house, we have a number of ongoing efforts that i think well yield dividends Going Forward. But well have to continue to make the case on the budget side of the house for the resources necessary to get that done. And you know, thats obviously challenging in the environment that were in today. And i think youll see with the 19 budget and beyond that were laying out a compelling case for the size of the fleet we need and what it is going to cost Going Forward. You mentioned capacity also in terms of people. And you also mentioned maybe the, you know, dusting off kevin mccoys, you know, one shipyard concept. Are we seeing strain in competing for the same people . A couple observations is that what we found with the sequester, the fiscal cliff, and some of the wild swings was that we were turning on and off veils and when you went to find the person with the skill set, they werent there, or you had to pay more. And then last i saw and you have the latest, that you were still a little short on the government side of hiring the shipyard workers. Yeah. You had a goal through 16 of having about 2,000 more than you currently have onboard. Are we eating ourselves on this, and is there a better way to do this . Well, there is some tension in the nearterm. We do compete for resources with other industries. So when we have the downturns, we tend to lose the workforce, shortterm. But to your question, can we get the workforce necessary to go build the ships that we need and do the maintenance . The answer to that is yes. Weve had that in the past. You know, in the 90s, newport news had 27,500 workers. Norfolk naval yard was up in the 30,000s at her peak. So weve got to provide, you know, a package of things that would interest the young people to come work at the Naval Shipyards today. We do compete for some of those people. So in the shortterm, we grab people they would like to have and vice versa, but if theres a stable, predictable plan out there and we know were going to grow the size of the force, when i talk to the leaders of industry, theyre not worried they can grow. And im not worried that well have a problem growing the size of the Naval Shipyards as well. I think weve got a good plan out there and well be able to press on with that Going Forward. Last question before we open it up to the audience. You mentioned the good news is, we got a big bump up in o m, operations and maintenance money, to do maintenance near term. Whats the next big thing past that, that you would like to see more investment from a prioritization standpoint. Where do you need the most help . Iffed ed admiral moran got his maintenance, whats the next dollar go to . Yeah, so i think, in my lane, on the maintenance side of the house, the next dollar goes into investing in the shipyards. Making the investments necessary to go make the workforce more productive. You know, theres an expectation, a correct expectation from the cno that were going to give you all this money, we want you to deliver things on time. But once you get the workforce and youve got the workforce that you need, we expect you to get better. One of the challenges we face today is weve added a significant number of people in Naval Shipyards over the last six to seven years, is that i have a pretty young workforce. Half the people have been there less than five years. Obviously as we add another 2,000 people over the next two years, that trend is gonna thats not going to change significantly. So weve got to recognize weve got a young workforce, and weve got to go train them to become more productive and weve got to provide facilities to become more productive. Because the expectation is correct, which is, hey, im going to give you the people and the dollars, but i gotta at the end of the day, i need some of those dollars to build ships and planes and weapons as well. So once you get that workforce trained and its there, i expect you to be able to figure out how to do a 250,000 mandate ability for 230,000 mandate, for example. So my next dollar would go into investments in the physical plan of the Naval Shipyards to make them more productive so that we can ultimately start tipping that budget over a little bit and let the resources go somewhere else, where theyre needed. Thank you. Okay, lets open it up. Well have a few folks here. We can just call on you. Sydney, you get the first question. Ask you to identify yourselves and ask a question. For everyone whos not thoroughly sick of me, sydney friedberg, breaking defense. You said some interesting things about how if we invest in maintenance and extending the service lives of our current ships we can get to 355 a lot faster because there is a big return on investment for that. Id love you to walk through some of the details and the numbers on that, you know, how much life are you thinking of getting out of what ships . Can every r. Lee bird get another five years or is there much more nuance across classes and blocks . And what are sort of your bestcase, middlecase, and worsecase scenario for how much time you can bring that 355 goal to the present. Yeah, the answer to the question, yeah, i think it applies to all the articley bird a ships that have vertical launch. Were not going back to some of the earlier ones. But the study has looked at basically from dg, maybe 53 or 54, but it essentially applies to all the r. Lee birds with the exception of tyco and yorktown and gates. How much service life can you get out of them . Certainly at least five more years. Weve taken a look at it, im convinced on the navsea side of the house, extremely lowrisk. Weve kinda looked at it from the i think you could at least get it out to its next dry docking. In many cases, thats more than five years beyond with relatively risk and relatively low cost. The key is with being do tdo th that you need to do, then have some baseline capability that you would like to have. For aegis, we have an idea on the c4i side of the house. I think it is a relatively lowrisk proposition. As i said, running the numbers, i think you could probably shave 10 to 15 years off of the when it would take you to get to 355 if youre willing to consider the entire fleet in that set. Obviously thats not im not the decisionmaker on that, but from the technical side of the house, navsea doesnt see anything technically that would prohibit us from extending the service life of the ships. Again, do the maintenance and the modernization so theyre combat relevant Going Forward. And we know how to do that. So i dont think this is something that were leaning that far forward on technically. I think its pretty straightforward. I will say, on the aluminum hull side of the house, we dont have as much Knowledge Based on aluminum hulls and how they react over time. Weve seen some of the challenges with just the aluminum structures on the cruisers. So im not willing to go lean forward yet on how far we could get the aluminum hull ships which have a 25year service life. But on the steel hull side, theres no technical issue going longer. The nuclear side of the house, i think weve probably sharpened our pencils and the ssns are where they need to be today. What im looking at is on house, carols will stay 50 and the surface ship side of the house. The submarine force is i think pretty well understood how long we can take those out based on propulsion point issues and issues associated with the hull from diving and safely operate and submerge. Can i just jump in here, to hit one on cyber. Yes. We think of other commands as having the lead on cyber, but for the force in being and the force that youre building, navsea has a huge challenge here. Can you talk a little bit about the special efforts required in that arena to become cyber compliant and secure . Thats a great question. I probably should have mentioned that in my remarks. I would say as part of this effort to extend the service life of existing ship, when i talk about modernization, cyber is a key piece of that. A lot of people when they cyber think because they dont know the i. T. Systems. Navsea, im responsible for all the hm e systems from a cyber perspective. Weve got to stay out in front of that. Ontime delivery of ships and submarines, culture of portability and number three is cyber for very good reason. The wannacry stuff gets our attention pretty quickly. The reality of it is, our ships and submarines today, theres not a combat system on that ship that doesnt have, thats not heavily invested in software and computers. I just came from riding the trials on gerald r. Ford, that magnificent ship. Shes going a machine and control system that allows you to take thousands of people off that ship that operates and the ship remotely and not having to have sound and security watching some of the things that we did in our earlier days. Thats great stuff, but all that stuff has computers associated with it. So the cyber piece is not just, dont hack into my email or get into my credit card, it goes a lot further than that on the ships today. We on the navsea side of the house, we have a very big focus on how do we go manage this Going Forward. Have you had to set up any new Staff Organization or bring on new folks to deal with that . Yeah, we have. We stood up we have a chief Information Officer now, weve grown the size of my workforce there on the believe it or not, a lot of the cyber folks are in the engineering director and navsea, a cyber counsel that i meet with monthly. And were working on standards with admiral ty and 10th fleet admiral gil day on that. So as we grow navsea and we would have to grow navsea, if we grow the size of the force and were looking closely at the cyber piece of that. Thats a key point. More questions. Megan, you had your hand up earlier. Go ahead. No, right here. Since sidney did me the favor of asking my first question, ill ask you about the public shipyards. You mentioned trying to get the same maintenance availabilities done with fewer man hours. I was wondering if that would come as a result of upgrading the yard infrastructure like you mentioned or if that would take some meaty rethinking how you approached the processes, how you innovate the procedures . Yeah, i think its a combination of all of those things. So, one, if youve ever been i use ingalls as an example after hurricane katrina, we had the opportunity to rebuild. And obviously katrina was a terrible blow to the gulf coast down there, but when they had the opportunity to rebuild the facilities and kinda rethink how they made things out, you look at how ingalls is performing today on the new Construction Side of the house, theyre knocking it out of the park. So anybody that does Industrial Engineering would tell you how your shops are set up and how you flow material can go a long way towards cutting making you more productive. The second piece of it is the workers that are coming in today and training them and providing them with Training Facilities to get them up to speed quicker and then providing them with the tools to be more productive. I think one of the things we tend to be a pretty conservative organization on how we use technology. And theres great opportunity out there, i think, to use technology, including cell phones, et cetera. Theres Security Issues with them, that would allow us to be more productive at the deck plate. Todays kids learn a lot different. Theyre not used to throwing a drawing on the table. Theyre well versed on taking an app on a phone and looking at a drawing or taking a picture of something on the ship and then pushing a button and having the material delivered to them. So theres a lot of opportunity here for us to get more productive that goes well beyond just adding people to the shipyards. Will the government work rules that we have today allow you to take full advantage of that . Is that another thing to put on the pile . Yeah, its another thing to put on the pile. Were fairly conservative about our use of new technology. But we get there eventually. And if you go look at the ford today, we do things today that we wouldnt when i started back in 1981, they would never have imagined we would have allowed ourselves to do. So its a recognition that you have to embrace the technology. It comes with risk, particularly on the cyber side of the house, but if you dont recognize that this is the way people learn and this is the way we move information, i think were missing a great opportunity to get better quicker than we would otherwise. Right here in the front on the end there. You mentioned the longterm plan for the public shipyards. Could you please be more specific about what youre assessing in terms of investments and people . Yeah. And when do you anticipate the study to wrap up . And is that study congressionally mandated or something the navy is doing on its own accord . Its not congressionally mandated. The Congress Asked for it in 2013. This is something that ive asked for and the c os asked for. The Naval Shipyard kind of got off and did this on their own a couple years ago where they hired an industrial engineer to go look at the layout and work flows and they mapped out where people had to walk to between the shops. So they were able to go put that on the plate and they showed that to me when i came in last year. I was very interested in that. So weve made an investment to go out and do the same thing at the other three shipyards to get a formal industrial engineer to look at the yards and go map out where all the shops and existing shops today, where do people have to walk to to get the work done. And if you were to optimize that, what would you do . So a combination of that. And then Capital Improvements on the facilities themselves, in terms of welding machines, et cetera. And the last piece of that is the dry docks. As we go to virginia payload module, to block five, you know, the submarines wont fit in a lot of the existing dry docks. And ford class carriers, for example, use different power on the pier and have different cooling requirements. So weve gotta upgrade the docks for those as well. So we have a longterm plan, Investment Plan that ive shown to the cno, and that includes the dry docks and the facilities investments necessary to get there. Its not cheap. Were talking youre talking on the dry dock side of the house, probably over the next 30 years, an investment of on the order of 3 to 4 billion necessary to make the dry docks compatible. Those are kind of musthaves. If you want to have virginia class submarines and you want ford class carriers, youre going to have to have greater dry docks. The second piece to that is the one where im competing with everybody else for the dollars which is to make the investments necessary in the shipyard. So, yes, that plan, we have the basic outlines of it, i owed cno an answer back in the fall, and i think it will finish up in, probably february of the next year with full details. Thats what ive told them. Is today 2017 . Yeah. February of next year. I think ill have a bow on this thing wrapped up and well lay out where i think we need to go from a navsea perspective. Im having this conversation with the defense communities as well. Theyre very supportive and want to help on this particular. Ill move it over here. Sir . Hi there, im mike stone from reuters. Thanks for coming in. You talked a little bit about frigate and delivery and keeping costs down. I wanted to understand how much time navsea would need with a foreign design frigate in terms of survivability systems and breaking that down . And if you can answer that, how would that compare to domestic design. I dont know that would take you know, i dont know, i dont think it matters where the design comes from, in terms of who develops the design, as far as how long it would take us to evaluate it. You know, i think that the thought is here on Going Forward with the future frigate, it will be a competitive environment that will include a look across a Broad Spectrum and we could consider a foreign design as part of that competition. We havent obviously gotten to that point yet. But if we got to the point where we were considering those designs, it wont take navsea any longer unless i gotta translate it from german or dutch or something to do the analysis in terms of the survivability of service. I dont think theres any time difference between where the design comes from. Okay, this gentleman right here on the end. Pass your mike. Thank you. Rick burgess, sea power magazine. Admiral, the nimitz class is halfway through its rcoh cycles. Is the ford designed to have an rcoh mid life and if so, will there be a gap between the last nimitz and the ford going in for the rcoh . Yeah. The ford class is designed for mid refueling as well. Mid life refueling. You know, we looked at what it would take to get to life of ship 50 core for a ford class. I think we concluded while technologically feasible, it didnt make sense from a cost standpoint. If youre going to keep the ship for 50 years, you gotta bring it in to a mid life overhaul anyway. And the refueling portion is only about 10 . Its not the critical pass. So we concluded it made sense to keep the refueling in there. So we will refuel the ford class. Let me do the math in my head here. Ford delivers yesterday. Shell be around for 50 years. Would be in 2040. Add 23 years to that. So, lets see, the last bush was the last nimitz classed and she will be around until 2057. So her mid life refueling, never do math in public is what my staff tells me, is in 2030. So there will be a little bit of a gap in the refueling program between when we refuel the last of the nimitz class and when we would do ford. Essentially the gaps going to be, we delivered bush in 200809. And ford in 2017. So there will be an eightyear gap between the refuelings and have to address that when we get there. Is there will be a lot of inactivations in mid class carriers at the same time, so i suspect that will counterbalance if youre new ship building in the 20402050 time frame, that would counterbalance some of the lost work in the rcoh program. Okay, over here on the right. Admiral daly, good evening. Rob alameda from rollsroyce. A lot of what you spoke about this morning, sounds like a huge data problem in a lot of ways. Particularly when it comes to, what i see, i see two data sets. One being stuff coming off of obm equipment, whether it be a rollsroyce turbine. We have a huge amount coming off the turbines that fly through the sky in the commercial world. All around the world. It provides us a really insightful way to do Predictive Maintenance on the aviation side. Thats commercial application. Within the navy theres a lot of other data that can come off the ship where the custodian is the u. S. Navy, and you may have information coming off obm equipment thats owned by, say, the oem. If youre trying to bring this information together and gain insights from it, how do you see handling that . I mean, we talked about cyber, but how do we handle who owns the data . Who protects it . And who is able to interpret in a way that allows you to gain efficiencies . So, one, im a big believer the navy should own the data Going Forward. And youre right, we have a lot of data coming off our ships today. We frankly dont make great use of it. You talked about rollsroyce engines. The Navy Leadership has been up to General Electric to see what theyre doing in what they call digital twins and the digital age and making decisions. I think thats a direction that we are absolutely need to head in. So i have, on surface ships today, i have a system called icas. Integrated Condition Assessment system. Weve had the ability to collect data for years. Frankly, we dont do a lot with the data to help us make decisions. But as we go to some of the systems we have today, like the fords class machinery control system, we have the ability to collect vibration data and temperature and stuff. And we absolutely have to go take a step forward and become more mature in the use of that data. The cno is driving us to go figure out how to make use of the big data to make better decisions Going Forward. Its across a whole host of different applications in my world, on the maintenance side of the house, how do you use data to make better decisions about when you do. Maintenance and what type of maintenance do you do. The commercial industry is light years ahead of us in that particular area and weve gotta get better at it. But to the data portion of it, you know, we need to get the navy needs to own the data so that we can make some integrated decisions about what were going to do. Okay, right up here, up front. Well get you a mike. Thank you, admiral. John harper with National Defense magazine. As you grow the size of the fleet and extend service lives, how much do you anticipate that o m cost will increase as you get toward to 355 ship number, and are you concerned that will eat into the money for procurement and new builds . Well, clearly, like a car, in our experience with, say, enterprise, or nimitz is now 42 years old, they do take a little bit more maintenance towards the end of their life. So but if youre going to get to 355 ships, you gotta recognize up front youre going to have a higher o m cost. If youre going into it thinking you can grow the fleet by 80 ships and your yeoman costs are not going to go up, youve got a problem. So i think we recognize that the costs are going to go up. Theyre a little bit higher towards the last, later part of the stages of a ships life. But theyre not astronomically higher than the nimitz class. But part of the way that you can keep those costs under control is to make it a consistent investment and do the maintenance throughout the life of the ship. What weve found on the nimitz class is when you do the maintenance consistently in accordance with the plan, that you dont get any major anomalies. When you dont, then you have problems. So, you know, the classic example for us is theodore roosevelt, cbn71, as we transitioned many years ago from a maintenance structure that we used to have into what we call today the incremental Maintenance Plan, most of the carriers got a complex overhaul to reset them. And t. R. Missed out on that. So when she got into her mid life refueling, if you were to look at how many mandates should she have had at 23 years, she had fewer man days of work done on her in her first 22 years of life. Than the first three did coming in, and 72 as well. We had a very challenging refueling overhaul, not surprising. So i think youve got to yes, it will cost you a little bit more towards the end of life, and we gotta factor that into our plans. But the key is consistent application of the Maintenance Plan and make the investments necessary on a regular basis to do the maintenance. If you do that, then you wont have these major perturbations in the last five to ten years in the ships life. Thats our experience. [ inaudible question ] i mean, you gotta do both, as i said at the beginning. You have to do the procurement and you have to do the maintenance. If anybody thinks we can get to 355 without having growth in both of those accounts, you know, theyre living in la la land, because thats just not going to happen. Weve gotta factor both of those in to the equation and weve got to have an upfront, honest discussion about the budget. But if you want to get to 355, you gotta do both. You gotta build and you gotta maintain. If you skip on one of them, which has been our history, to stop on the maintenance, then you run yourself into trouble. If were committed to 355 ships, weve gotta be willing to make the investment on the maintenance side as well. Im not concerned two eat into the procurement side. I just think we have to do that one eyes wide open. I think one of the things back on the new Construction Side of the house that we dont pay enough attention to is, be willing to spend a little more money up front so the total Ownership Costs over the ship over the rest of its life comes down. We dont tend to make those investments because the way the budget works, the budget year youre in matters and maybe the next budget year, but its pretty hard for people to make investments today that are going to save you money, 10, 15, 20 years down the road. Weve got to take a more total Ownership Cost perspective as we get into the next round of ships and be willing to make that investment. The ford class, for all the talk about the how much the first ship cost, we did make an investment in that ship that would, you know, save 4 billion per ship over 50 years compared to a nimitzclass carrier. And so thats a significant savings. And while people may not be interested in that 4 billion savings today when theyre struggling to balance the budget and build ships. I guarantee you if youre a fleet commander 15, 20 years from now and youve got several ford class carriers out there and the Maintenance Cost for those ships are significantly less than nimitz, youre going to be pretty happy that whoever was building the ford back in 2008 was smart enough to make the investments up front to reduce manpower and improve the maintenance reliability of the ship. Okay, on the end right there. Toby harshaw from bloomberg view. You mentioned briefly that this modernization of the shipyards had to happen on the private side as well as the public. You went into great detail on what youre doing in your four yards. But short of hoping for another hurricane, what do you do to make sure that the private side invests as much money in that as you guys are . Well, so obviously were not going to root for another hurricane. I think if you go look at the shipbuilders today, im satisfied the shipbuilders are making the investments that they need to make. If you can go look at electric boat and newport news ship building today, some of the things that theyre doing to build facilities that would allow more work to be done inside, they have a thing called the unit outfitting hull, which would allow them to get more work for colombia and do ford class carrier work inside. The challenge on my side of the house, the private sector is incentivized to make those investments because it makes them more profitable Going Forward. And so were willing to, and we have been in contracts on the new Construction Side, been willing to partner with them and share some of those costs, if theyre willing to make those investments, kind of in a cap x environment. Im satisfied that the yards today that are out there, competing for work, are making the investments necessary to keep those yards competitive. Thats one of the great things about competition. If the competition incentivizes them to make the investments necessary in the yard to make them more profitable. I dont have the same business model. Thats the challenge on my side of the house. Im not out to make a profit, so whats the incentive for me to make investments in the yard. I need something along i need that same type of thinking. To me, the investment is, i get more productive and therefore i spend less yeoman dollars, back to this gentlemans question of funds, less maintenance dollars in the future so theres more money available for procurement. Okay, question here in the center. Admiral shannon . Good to see you. Good morning, sir, jim shannon, Naval Academy class of 1981. Thats who im representing today. You made a point earlier about a resource constrained budget. If you could explain a little bit more about that, taking into consideration your service on the staff of then four, the role you played then on getting the maintenance dollars increased for after you left in four. And what are you seeing today among the resource sponsors . Does infour play that same role or has that shifted over to innine, and how does that impact you and your budget . Well, were clearly we clearly always have more requirements than we have dollars. I dont think thats new today. It may be tighter, the gap may be bigger, but weve always faced that challenge. You know, the organization the Organization Today places more of the role of managing of organizations and i think the process is more transparent and more open than i have seen it in the past. I am going to get quoted on this. The staff does not operate sometimes in an enterprise fashion. It was designed that way. Theyre pretty much focused on theyre advocacies. Theyre the advocates for that. They tend to advocate for that. I think what we are trying to get after is you know an enterprise look that says where should the next dollar go to make the most impact of the navy. What i am seeing of today in my 18 years in dc that it is as good as i have ever been. We are having that open discussion and kind of Corporate Board manner if you would to decide where is the money going to go and what are the specific trades and what happens if you put the dollars here and what happens of what dont we do. Instead of winners and losers, we are more of getting back to the cnos questions of whats the navy we need . So we are trying to work pretty hard to optimize the resource we have to get to the navy we immedianeed. I am satisfied the process that we have today that we are tweaking and finding to make it better is pretty good and row tu robust. I think everybody gets a voice in the process. As a result, i think we have a better outcome. We have a few questions left and i see general grayson in the front row there, i have to ask this question. There were some concerns thatitf did not receive the love that it needs. Could you talk about the recovery of their readiness and are you sacrifice of the marines on that. Well, i got marines on my staffs that manages the ships for me and talking to marine core all the time. 95 is a strong advocate for the war far branch. And whether we may have been in the past playing more resources in the side of the house and the nuclear side of the house, today we have robust planes across the board. We understand the service life requirements of the ships. Theyre being well maintained today. You are about to finish off. I am satisfied of making investments necessary there and i have been on a lot of the ships as well. I dont see indications they are the last person in line for the maintenance dollars. Now you mentioned loss, she had to sit out five to seven years because she had a combat system. Thats an example of recovery. W. A. S. P. S. Just came back from deployment at the end of 2016, we threw her into get her ready to go and being shipped. They have done extremely cool and contractor is doing very well and we are close to getting her out there and she will get over to japan and do great things over there. Well have to cut it here. But we want to thank admiral moore giving his remarks today and giving us his time of questions. Hes a very busy man with a lot o on his plate. One more time of our thanks to our generosities of our sponsors, Lockheed Martin. Without them, we would not be able to bring you this. We thank you them and thank you to our speakers today. Thank you. [ applause ] as well look at that t well go through a process thatll help us get quicker to okay, this is what we want. If anybody wants, we can send out detailed information of what set bases on so it will give you a pretty good answer. Thank you. Did you have the next question . No, i dont. Can i ask you something a little specific. You mentioned in the industry helping the attacked submarines, i was wondering if you can say which yards that is going to and why it is 19 instead of 18. I cannot tell you. It is a competitive bid. 19 was one of the capacity. I did not have the capacity of the shipyards. I had to get money in 18 and execution is 19. Really it is more about where the capacity existed then the industry than anything educationaelse. Is it just industry coming into the public yards to help out . So we got lapell columbus. Weve always gone forward and keeping this on tape as an option. I want to prevent another boise. As we grow the size of the work force and looking at all the submarines and what ef we have the plate, i dont have the capacity of the Naval Shipyard and we can talk to the industry earlier than we typically done. If you look at the list of submarines out there, there are cases where we have to look and go i think to the future more than what we have done today. I want to ask you of the budget. So, why is that, is that like the George Washington take longer . Gw is not going to start any longer. It is going to start later and whether we want to in activate every and what you are available of discussions. Shes going to start here in august. So there was a couple of things. One, the fleet needed her a little longer and when gw moved right to the year, it ciareatedf a significant over lap. So we look closely of that over lap. If it gets too much of an every lap, that would have been doing gw and it would have been building 79 and 80. That looked like a workload that was going to be a list before of natural disaster. That would have caused you some problems. Fleet wanted to move it. It fits the Industrial Based needed. I would say it is the kind of the model that i would like to go with all of our decisions. And the decision was to make them standard years in advance. Lets go look at the work we have and fleet needs, that comes first. If we can meet the fleet needs, you will get the work done on time and you will gel the work done cheaper if they can apply the resources. Moving away from the one shipyard concept, do you have any concept in mind for that . Oh i am not really sure. We are moving away from the shipya shipyard. Maybe i interpret what you said. The one ship constable is on the maintenance side of the house where we use the resources of industrial space like we did with columbus and etcetera and we can use it in the middle east. New construction, competition is always going to be what we are striving to get. So we are looking to maintain competition where ever we can. Thank you. Are you looking to extend the sort of line of everything i mentioned of. Lcs and some of the come up sportsmanship as well. If it is a ship and it is floating today, well take a look at what it will take to extend it so and so. I dont want the presuppose the decision. All i am saying is we dont have the knowledge performing the steel holes. What happens over 25 years, aluminum does not have the strength so you will have a little bit of flexibility on on the hall. There is issues with jo job just from stress sample and there is a whole sense of we have to look carefully and precautiously. You can get five years and you can probably get more. Last question, going . Going . Thank you very much. Thanks everybody, good to see you. Please keep my card. Thank you. Today Steven Mnuchin testifies today of his 2018 budget request. We have live coverage at 4 00 p. M. Eastern cspan 3. Chief madden joining chairman do dunford. Their coverage begins at 7 00 p. M. Eastern on cspan 2. In case you miss it on c span. Calloway on the possible threat of climate chapg on national security. If you go back to older film of the 1980s of whether it terrain of the most significant battlefield combat. Whether it is the open seas or it is the the heel you are going to climb. They are in change. The military is concerned about that. The military is long had an interest of dealing with things like this and forecasting what hay happen. I want to know why you dont have to single pamg and ask uhuh through i said in in beginning of the meeting and thats interruptions, you know are not going to be tolerated. Okay, if you please sit down, sir. Would you please sit down . Will you please sit down. Out in the hall. Thank you for leaving. Main senatoor anchor king. Why are you not answering these questions, is there or not . Not that i am aware of. I feel it is it is appropriate precipitation. What you feel is not common. Today we release a report titled was the cup on the beat. Which is regarding cppp olding in add rate rules from in pres gating. We have received numerous records from lbb and indicates that the cspp was sleep at the whole. Y span available. Tomorrow at 2 30 or at the library. Shes expected to answer questions on several issues including ongoing investigation. About formal fbi director james comey testify. You can watch live coverage tomorrow at 2 30 p. M. You can listen live on cspan radio. Next of a discussion about the federal role in education and the level of change expd