FEATURE
NAVY
Austal Ramps Up for Potential $1.6B Navy Project
JHSV Set to Take Shape
By Greg Trauthwein
Fast. Shallow Draft. Flexible, with considerable troop and cargo carrying capabilities. Meet the new Joint High Speed Vessel (JHSV), the result of a contract from the U.S. Department of Defense to build the first JHSV at Mobile, Alabama-based Austal USA. The contract is yet another watershed deal in the redevelopment in the way in which the U.S. moves its military personnel and equipment around the globe. Austal is the prime contractor for the project, and the company will design and construct the first 103-m JHSV, with options for nine additional vessels -- a program worth a potential $1.6b -- expected to be exercised between FY09 and FY13. The contract for Austal is a culmination of a long-term investment in the U.S. market for the Australian high speed vessel builder, and the JHSV will
be similar to the Austal-built WestPac Express operated by the U.S. Marines for the past seven years, capable of transporting troops and their equipment, supporting humanitarian relief efforts, operating in shallow waters and reaching speeds in excess of 35 knots fully loaded. The vessels will be a joint-use platform operated by both the United States Army and Navy. "In many respects, I think this (the JHSV contract) has put Austal on the map as being a prime contractor for the U.S. Navy, and is an acknowledgement by the Navy that we've created a company that can perform the awarded work within normal and acceptable risk, which generally means no risk," said Joe Rella, Austal USA's President and COO. "We have put the people, plant and process in place to succeed." In fact Rella's "three P's" -- people, plant and process -- are a mantra as fundamental to the Austal USA plan as the "three R's" are to education. Austal
has invested mightily to earn this contract, an investment which sees the company powering forward in these challenging economic times while companies large and small fall to the wayside. "We are focused on bringing in people from the shipbuilding industry with a proven track record of success, though we have brought qualified people from other industries when the process expertise had a maturity beyond where shipbuilding is today," Rella said. "We have hired a first rate, world-class team. My bias is almost always toward people who have shipbuilding experience." He said the economic downturn has increased the pool of talent from which Austal draws, but that its hiring standards have stayed steady throughout. "In general, the depth of applicants for open positions has increased, but we've also maintained high standards on our hiring practices," Rella said. "We have always focused on getting the most qualified people, and today we simply
have a broader pull from which to draw." The 'Plant' investment comes in the form of the new $90m, state-of-the-art Modular Manufacturing Facility (MMF), which at press time was about 55% complete, according to Rella, with the plan to be up and running by mid2009. Phase 1 of the project includes 350,000 sq. ft. of manufacturing space and 80,000 sq. ft. of ware house space. Phase two -- which in essence will eventually be the 'other half' of the Phase 1 building, will commence once the company has a backlog which warrants the additional throughput. The people and the plant are critical elements in the third 'P' -- Process -- as the inauguration of the new MMF plant will mark Austal's full transformation to a Modular Building process, a transformation which was required to efficiently and effectively build complex vessels such as the JHSV. According to Rella, Austal is currently
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