Transcripts For CSPAN3 Forum Focuses On U.S. Navy Maintenance Challenges 20170627

And international studies, this is about an hour and a half. All right. Well, were going to go ahead and get started. Good morning, everyone. Im a senior fellow here in the International Security program at csis. And im delighted to kick off this mornings Maritime Security dialogue with vice admiral moore. The Maritime Security dialogue represents a cohosted series between csis and the u. S. Naval institute or usni, and it seeks to highlight both current thinking and future challenges facing the navy, the marine corps, and the coast guard. Today represents our second dialogue for 2017, and we look forward to welcoming yall back for additional events throughout the year. We would also like to thank, in a special way, Lockheed Martin and Huntington Ingles industry for making this series possible. And before we get underway for big events like this, we also like to make just a brief announcement, safety announcement, we dont expect any difficulties, but should there be anything as a convener, we just want to make sure that you know weve got some exits right here in the back on both sides and stairs down the front and 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 daly, retired, chief executive officer of the u. S. Naval institute and were happy to have him here and be partnered with usni. Thank you. Welcome. For those who dont know me, pete daly, ceo Naval Institute. The Naval Institute and csis are proud to bring you this maritime dialogue series. And as mentioned we give special recognition to our sponsors, Huntington Industries and Lockheed Martin. For making this event possible. Now ill introduce 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 a lateral transfer to the engineering duty officer community. There, he served in billlets mostly focused on refuelling complex overhauls of Aircraft Carriers. Major command included Major Program manager for inservice Aircraft Carriers and Program Executive officer for submarines, peo subs. Finally, last year, in june, vice admiral tom moore assumed command as the 44th commander of navc. I point out that theres 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 the maintenance and the systems that go on those ships directly. So, we welcome admiral tom moore, who controls one quarter of the navys budget. Thanks, pete. I always am reminded of that by the cno. By the way, you have one quarter of the budget. Thats not necessarily a good thing. So, good morning, and thank you for the invite this morning. Before i get started, last night was a big night for the navy. A couple things. One, my band played live down at the water front, and then lets see what was the other thing that went on last night . Oh, yeah t other thing is we delivered the ford and to the navy. So, kind of a big night for us, actually, from my perspective of having worked on ford for most of the past ten years, just came back from a very successful acceptance trial and the board survey and the navy accepted delivery of the ford last night so you heard it here first. So, thanks for the opportunity to come talk this morning. The theme that was given was the maintenance challenge and thousand reset the fleet. And so what id like to do is talk about this and kind of the context of talking about where the cno is headed with the size of the fleet and then talk about what were doing to grow the size of the fleet on the new Construction Side, but then importantly, talk about, you know, how the maintenance side of the that equation fits in. Its not, you know, admiral daly and i were talking beforehand, its not either. You got to do both. And so sometimes we tend to forget about that. Having been a shipbuilder for most of the last 15 years but also spending time on fleet redirec readiness, im well aware that you have to maintain what you have and continue Going Forward. If you havent read the white paper, get a copy. Its a good read. I like to tell my mast chief its short, has some pictures in it so its great for commander master chiefs. Their lips do not get tired when they read it. And the cnos white paper talks about, i think, importantly, up front, the what the current security skrierenvironment is. And he makes three key points and these key points are applicable when youre talking about new construction or whether youre talking to maintenance sides of the house and the three key points are time matters. There has to be a sense of urgency in some of the things were getting after today. And that applies to across the board, to getting ships and submarines out of availabilities on time to figuring out how you can design these ships quicker and get them built quick e. The second thing is that the pace stay exponential, and if you can look at the world today, and the threats that were facing, the learning thats going on in our near competitors, say russia and china, and the pace theyre changing that capability is changing exponentially and we have to keep up with that pace. As the cno likes to say, its kind of like we went into halftime of a Football Game in 2000 up about 283 and kind of popped the champagne and said, games over, and dmft the referee came in and said, halftimes over, were ready to start the second half and we said, well get there when we get there and we kind of strolled out midway through the Third Quarter only to find that the score was now 2824. So that capability gap between us and our competitors has really closed and its something thats really a keen interest to us here on the navy side of the house in terms of whats the capability that we need Going Forward. So theres a lot of discussion going on today about what is it that what is the navy that we need, and not necessarily what is the navy we need, necessarily in the 2040s but whats the navy we need in the 2020s and we tend to talk a lot about whats the navy we need today, and were trying to take a little bit of a lead angle and figuring out what is it the navy we need, you know, probably in the mid 20s and go make some decisions based on kind of that navy that we need in the 2020s. Theres been a number of recent studies, some done by the navy, some done by independent groups, about what is it that navy need, what should it look like and they all have kind of varying mixes of ships and stuff. But at the end, they all came to the same conclusion, is that we need a bigger navy than we had today and theyre all around the 340 to 350 ships so clearly the size of the fleet does matter Going Forward. And the capability of that fleet a s also going to matter importantly as well. So how do we get there from so one of the things, when we talk about the size of the fleet and i know ill get questions about, hey, the 18 budget didnt add a bunch of new ships, what happened . Well were never going to be able to turn that around overnight. I think what youre going to see, and ill get into it a little bit more in later in my remarks, you know, the 18 budgets holds what we have on the new Construction Side but makes a significant raise 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, hey, the first dollar we get ought to go to readiness and i think thats what youre seeing in the 18 budget. Now, a lot of we spent a lot of time talking about, what is the strategy, the future navy white paper, the design for maintaining maritime superiority all goes to what the navys strategy is Going Forward. And its easy to say, having been in washington, d. C. Since 1999, i tell my people, im on my 18th palm, which is kind of hard to imagine, and if i had a collar every time someone said, you know, we need to build the Strategy First and then the strategy will drive the budget. In the world we live in, that sounds great, but the reality of it is, you dont want a budget completely driving your strategy, but you cant ignore the fact that we live in a fiscally constrained environment. So, you know, what we would like to say about the navy budget is that it is a resourceinformed strategy. And i think thats the reality of where we are today. So were going to increase the build of the ships that we have today. We think the Industrial Base can probably build over the next seven years based on the capacity they have probably 29 more ships than we had in the knowledge 310ship plan. Weve got to get more capability for that dollar. We have to figure out where the need and the curve is with the industry to get them to go work on this stuff. And we have to figure out how to innovate and what are we going to work on the new Construction Side of the house. Were going to continue to build in ddgs. Were going to continue to build the amphibs that we have today. Theres an ongoing discussion on the lcs and the frigate. That is still kind of churning around inside the pentagon that we owe some answers to the congress here later this summer on that. Youll see some things going in that particular area. As we head out, further out, you heard me talk about this before, the future service combatant, what their placement with the cg is, thats going to be critically important as well. Kind of a new buzz word inside navsea, inside the pentagon is swap. S. W. A. P. Space weight and power. And if you heard me talk about, before, as we go build the future navy, while i cant tell you exactly what its going to look like, one of the things that really important for us as we build these platforms is to make sure the platforms have enough space, weight and power so you can modernize and adapt to future threats. We are kind of in an age of electric ships. You probably heard me say before. Ddg 1000 and ford class carriers are prime examples of kind of building in space, weight and power into the platform so that you can adapt and go forward. An interestingly, the ddg51 class, which is around today and serving well, as we have gone and theyre going to build flight 3a, were going to provide late bit more space and a little bit more powner that Going Forward. And those ships are kind of unique in their ability to stay around. It was interesting, you know, my First Department head was on ddg17, uss cunningham. We used to get rid of ships back then at the 25year point. And we probably got rid of them at the 25year point, we didnt do maintenance on them. Anybody that served on a ddg knows they were tough to maintain. The reality is, we didnt spend any money on the maintenance side. At the 25year point a lot of people think, hey, we ought to get rid of these things because theyre rust buckets. The reality of it is that we really got rid of a lot of those ships because from a combat systems standpoint they had become obsolete. And so, fast forward to today, with looking at open architecture, 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 we have a combat system thats not obsolete. Now back over to the maintenance side of the house, now, if you want to get more service life out of the hull, you have to do the maintenance on it. And, you know, admiral daly and i, when i first became a flag officer in 2008, he was fleet forces command, we reached this kind of epiphany where we had not spent any money doing maintenance on our Service Ships for about ten years and we woke up one morning and found out, oh, my goodness, were failing all these in serves and we cant get the ships to their expected service life. In hindsight, it doesnt take a Rocket Scientist to find out, if you dont make investments on the maintenance side of the house, you cant expect the ships to get to where they need to get to. Wed gone along happily for ten years, look, not doing maintenance and saving money to do other things, its working. The reality is, we were consuming the service life of the ships that was built into them and the redundancy, and eventually it caught up to us. If we spent the better part of the last probably eight to nine years digging ourselves out of that hole, particularly as it relates to the surface ships. Private sector of the Service Ships. So one of the key components, i think, of getting out to the size of the fleet that we need is going to be looking at, you know, taking the ddgs we have today and actually extending the service life of these ships. Most of them are in the 30 to 35year range. So were taking a pretty close look at what would it take to get them out another five or ten years . And the reality is that, 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 ships around longer than we have today. And people will say to me, well, weve never really gone a surface ship past 30 to 40 years, and i will point out all the time, yeah, but we routinely take Aircraft Carriers to 50 years. The reason we do that is because we consistently do all the maintenance that you have to do on an Aircraft Carrier. To get it to 50 years. We know how to do this. And i think what youre going to see is, were going to take a very serious look of taking the service life of the existing fleet and extending it out five to ten years. If you do that, and youve seen probably some of the Structure Assessments that gets us to 355 ships around 2045, if you keep ships at their Current Service life and build new, we can probably accelerate that to get to 355 in 10 to 15 years with a relatively small investment over a 30year period. Were going to take a close look at that. One of the things that i have, you know, consistently pointed out as we go look at the new frigate design, look at the future service combat tapped is, we should not design a ship with a service life of a planned service life of 25 to 30 years. Doesnt make any sense. We ought to plan service lives of 40plus years for all of our ships and then build in the s. W. A. T. Context so you can adapt them Going Forward. And i think thats going to be part of our strategy Going Forward. So, the last part i think i wanted to talk about is, i wanted to talk about the maintenance side of the house, and kind of resetting the fleet. If you heard the vice chief back in february, he talked about the fact that if i have the first dollar i get, new dollar i get needs to go to readiness. And the good news is that the fy18 budget has an unprecedented amount of money for readiness. 9. 7 billion in the maintenance accounts, to do maintenance on our ships. And thats good. We need that. Although, as i tell the folks at navsea all the time, we have the resources we asked for, okay, now its over to us to deliver. Its important to understand, when you talk about maintenance, that its not just resources. Im careful, quick to point out that its just not 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 people today, going to grow that to 36,100. Thats where we need to be to consistently deliver the nuclearpowered ships and submarines on time. Today were not doing a good job of that. Only about a third of them deliver on time. Weve had a better year on the carrier side of the house. 12 of the 17 submarines are either in maintenance, overhauls, or inactive are behind. So we have to kind of 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. Navseas Number One Mission priority is the ontime delivery of ships and submarines. And the reason is the number one priority is because of the 235 ships i have today, about a third of them at any time are under navseas control, either in a maintenance available or in pierside availability. To the extent that we dont get them out on time, it causes a great stress on the force. You may remember, there was an article back in january, february, i cant remember the exact month, where a reporter said that the u. S. Navy for the first time did not have an Aircraft Carrier at sea, the First Time Since world war i, we didnt have an Aircraft Carrier at sea. Thats a startling statement when you think about it. Part of that is because we were down to ten carriers, but the other part is because the george h. W. Bush, in maintenance in norfolk, supposed to be eight months, took 13 months. So, it wasnt lost on me when i came into the job a year ago that navseas ability to get these ships out on time is critically important to resetting the fleet and getting the fleet to the size of the fleet we need. S so, back to my original comment. One, we need more people. Clearly. But it cant be only about the people. There are a couple of other things we have to do here. So, one, i have to have the capacity to do the work. That gets to the people side of the house. Then i have to figure out new ways to train the workforce. The kids today coming in, they learn differently than we learned. And the typical timeline to get a trained worker at a Naval Shipyard, when you get them in the door to the time you can get them doing something useful in the ship, is about five years. We have to cut that back. New training methods were looking at we can have somebody turn a wrench and do something useful on our ships in two to three years, versus five years. Were going to have to think differently about how we train the young men and women coming in today. Because they learn differently than we do. The other thing is, were going to have to make an investment in the shipyards, on the private side, and the public side, in order to get the work done more productively. Than were getting it today. Many of our shipyards, some of them are several hundred years old. A lot of them were designed to build ships. In the early part of the 20th century. And theyre really not set up to handle maintenance the way it should be. We typically, in terms of Capital Improvements in the yard, we make investments in equipment and replace equipment on the order, every 20 to 25 years, the Industry Standard is about 10 to 15 years, less than that. I have buildings that are over 100 years old that i cant get work done. So we have to make a concerted effort to look at, from an Industrial Engineering standpoint, how do we set our yards up . And weve got to be willing to make investments in our Naval Shipyards in order to get the work done more productively Going Forward. Finally, youve heard kevin mccoy talk about this many years ago. We have to take the entire Industrial Base into account here. We do have capacity other places when we dont have capacity to do the work in our yards, and this one Shipyard Concept that we talked about probably ten years ago is something we have to look at again. We are getting significant help from both e. W. And h. I. , newport news on some submarine work, were going to need that Going Forward. We have a lot of challenges ahead of us, but the good news is, from the maintenance side of the house, im very encouraged where were headed. Weve got the resources that we need. Weve got a Firm Strategy Going Forward. Well start delivering ships and submarines on time. Well take a very serious look at how we extend the expected service life of the ships that we have. That will also be a part of our maintenance strategy. And i think when you combine those two things together, and add that into the build strategy that were going to have, that 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 just by building new. So with that, i will conclude my remarks and well have a seat here and ill 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, you know, readiness today and build for the future, and its ever been thus. You can go back all those 18 palms or whatever you said you worked on, that was probably there on the first one, and its probably there today. But one thing that sticks out is that the gap may be widened, more than before. The fleets have been running at a very high tempo. You did mention the fleet response plan. But that made more of the fleet more available yeah. For tasking. And you alluded to the report, didnt mention it by name, but have we have we caught up enough . I mean, back in 20082009, 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 members of the in serve board over here. They would tell you that the recent trends on this is a graded event. Graded event. Okay. This is just an okay pass for land. So, theres a couple of aviators out there that got that. I think weve closed the gap. I think but its i think 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 a particularly important, when you talk about the ofrp, because, you know, ofrp was built and they put maintenance at the front for a reason. It was in recognition that you got to get the maintenance done. Were off doing that. But i think the other thing about ofrp, and were having these discussions, ofrp was designed, really, to provide more force. Right. So, youll hear admiral davis talk about it. He mentioned a couple of things. Reset the force, provide, you know, Power Forward in a rotational manner, but it is meant to provide surge capacity. And i think we havent yet tapped into the surge piece of it, and were likely to see more use of, for instance, you know, an Aircraft Carrier, when shes in a 36month cycle, if shes got a sixmonth maintenance availability and then she works up for eight to ten months, you know, shes got a significant period of time. So, you send her on a sevenmonth deployment, you come back, we would like to continue to use her again. I think, you know, were going to go look at, you know, weve made the investment in the maintenance and were going to get the use out of the platforms. But as you use the platforms, you consume the service life out of them and that circles back to the importance of, to your point at the beginning is, okay, were going to use ofrp the way its meant to be used, and make the forces available, then weve got to makes it even more important to go do the maintenance. 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 is, in the post9 11 era, even though the total number of steaming days of the fleet didnt change dramatically, 40 more deployed days than we had before and its kind of like running your car to church or running your car across the country. We were running the car across the country a lot more. We had to do more maintenance. Yes. So you mentioned thank you for that the shipyards and the need to recapitalize that infrastructure. You can go up to 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 . Yeah, i have limited authority to take the omen money to do that. One of the things that ive been working at, had some very serious discussions and frankly, defense committees have been very open about having a discussion about providing more flexibility on with some controls on the use of that money, to make some of the investments we need. On the same side, you know, the milcon side of the house, the milcon budget is always relative to the rest of the budget, relatively small. We need to compete for those dollars, as well. We are laying out a longterm investment strategy. For the Naval Shipyards. Cno specifically asked me, whats the plan . This gets back to my original comment, which is, you know, just throwing more money and more 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 of those is making the necessary investments in Capital Equipment and machinery, et cetera. But providing shops and stuff, if you go, you know, and get your work done, that flows the material and flows the work into the ship better than we do today. So while we dont make the investments we need to make today, thats pretty clear, i mean, we make we meet the 6 threshold thats mandated by congress, but thats kind of a hold what you got and were going to have to take a serious look at what it takes to go invest in these shipyards, particularly if were going to grow the size of the fleet. The shipyards can handle the 275 ships, but if youre talking dry docks, shops and throughput to handle 355ship navy, you have a completely different issue. Right. I agree. Just to get back to capacity issue, youve got a lot of folks out here who are working in industry. Youve already, in your remarks, highlighted the fact that the 18, as far as the next proposed budget, it came down on focusing on nearterm readiness. Makes sense, to a degree, but there was a lot of people, frankly, who were expecting a little bit more. Its the same number of ships in the ship count for 18 as there were in the 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 rampup to 355, which, you know, so, 18s kind of a readiness year, but what should they be looking at . Well, i think Going Forward, i think we in the forestructure assessment we laid out where we want to head. I would tell industry, you know, the key is, we want to keep our production lines going. We want to, you know, with the new frigate or future service combatant, we need to look at ways to streamline the acquisition process. The new buzz word is setbase design is the way to kind of take options and get your, you know, get through the early stages of what the design of the ships going to look like. I think industry is partnering very well with us on that particular area. But its going to be a combination of continuing to build, you know, ddb51s and the production lines we have, and innovating and figuring out how we can build quicker for the next set of ships that are going to come down the pike. And some of those are, were continuing on building forward class carriers, you know, as the cnos stated in his white paper, we would like to get to 12. That would change build centers from five to four. Thats one of the things were looking to do. And then on the surface side of the house, you know, weve got a number of ongoing efforts that will i think were going to yield dividends here Going Forward. Were going to 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 well i think youll see with the 19 budget and beyond that were laying out a compelling case for the size of the fleet that we need and what its going to cost Going Forward. You mentioned, you know, capacity, also in terms of people. And you also mentioned maybe, 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 in avails was that we were turning on and off avails. And then when you went back and tried to find that person with that skill set, they either werent there or you had to pay more. And then, last i saw, and youd hatch the latest, that you were still a little short on the government side of hiring the shipyard workers. 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 early on, in the near term, you know, we do compete for resources with other industries and so when we do have these downturns, we tend to lose the work force. Shortterm. But to your question, you know, can we get the work force 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. When i started working at Newport News Shipbuilding in the Ships Company enterprise in the 90s, newport news had 27,500 workers. Norfolk Naval Shipyard was in the 30,000s at her peak. So weve got to provide, you know, we have to provide, you know, package of things that would interest young people to come work at the Naval Shipyard today and industry would do the same. And yeah, we do compete for some of those people, so in the shortterm, some of them, you know, we grab people that 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 that they can grow their work force and frankly, im not worried that we are going to 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. Youve mentioned that you the good news is is that we got a big bumpup in onm, operations and maintenance money to do maintenance near term. Whats the next big thing that you think, past that, that you would like to see more investment, what, from a prioritization standpoint, where do you need the most help . If admiral moran got his 19 billion, 19. 8 billion, whats the whats the next dollar go to . Yeah, so, i think, you know, 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 work force more productive. Theres an expectation, a correct expectation from the cno and the fleet that were going to give you all this money, we want you to deliver things on time. But once you get the work force and youve got the work force that you need, we expect you to get better. One of the challenges we face today, weve added a significant number of people in Naval Shipyards in the last six to seven years. Is that i have a pretty young workforce. Half the people in the Naval Shipyards today have been there less than five years. Thats, as we add another 2,000 people over the next two years, that trend is going to, you know, thats not going to change significantly. So weve got to recognize we have a young work force and we have to go train them so they can become more productive and we have to provide them more facilities to be more productive. Because the expectation is correct which is, hey, im going to give you the people, im going to give you the dollars, but at the end of the day, i need some of those dollars to build ships and planes and weapons, as well. Once you get that work force trained and its there, you know, i expect you to be able to figure out how to do a 250,000 mandate availability for 230,000 man days, for example. So, i think thats the challenge that we face Going Forward. And so, my next dollar would go into investments in the physical plan of the Naval Shipyards to make them more productive so we can ultimately, you know, start tipping that budget over a little bit and let those resources go somewhere else. Where theyre needed. Thank you. Yeah. Okay, lets open it up. Well have a few folks here, we can just call on you. Sidney, you get the first question. I ask you to identify yourselves and ask a question. Identifying myself for everyone that is already not thoroughly sick of me. Sydney friedberg, breaking defense. Good to see you both again, admirals. You said some interesting things about how did if we invest in maintenance and extending the service lives of our current ships, we can get to 355 a lot faster. Theres 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 . I mean, is it can every one get another five years or is it much more nuanced across classes, so forth . And, you know, what are sort of your best case, middle case, worst Case Scenarios for how much time you can bring that 355 goal closer to the present . Yeah, so, the answer to the questions, yeah, i think it applies to all the ships that have vertical launch. Were not going to go back to some of the earlier burks, but i think where this study has looked at, basically, i think from ddg53 and 54. I cant remember the number. But yeah, it essentially applies to all the burkes and it will apply to the cgs with the exception of york town and gates. How much service life can you get out of them, you can certainly get at least five more years. I think weve taken a look at it. Im convinced on the navsea side of the house, extremely low risk. Frankly, we kind of looked at it from the i think you can at least get it out to its next dry docking, which in many cases is more than five years beyond. With relatively low risk and relatively low cost. The key is, do the maintenance that you need to do and then have some baseline modernization capability that you would like to have. So, you know, on the combat systems side of the house, today, thats baseline nine. For age jis, we kind of have a idea what that looks like on the c4 side of the house. I dont i think its a relatively low risk proposition. As i said, running the numbers, i think you could probably shave 10 to 15 years off of the what it would take to get to 355, if you are 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 do the modernizations so they are combat relevant Going Forward s and we know how to do that. So, i 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 Super Structures on the cruisers. So im not willing to lean forward yet on how far we could get the aluminum hull ships which have a 25year service life. But clearly on the steel hulled side of the ship, theres no technical issue to going longer. The nuclear side of the house is the ssns have a whole series of separate issues. I think we have, you know, we probably sharpened our pencils and the ssns are where they need to be today. What im looking at is on 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, you know, propulsion plan issues and issues associated with the hull from diving and safely operating and submerged. Can i just jump in here and ask you to hit one for a minute on cyber. You know, we think of other commands as having the lead on cyber, but in fact, for the force being and the force that youre building, navsea has a huge challenge here. Could 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 some of my remarks. And i would say, as part of this effort to extend the service life of the existing ships, when i talk about modernization, cyber is a key piece of that. So a lot of people, when they hear cyber, they think spay war. They own all the i. T. Systems. Navsea, im responsible for all of the hmne systems and all the combat systems from a cyber perspective. And so weve got to stay out in front of that. I have got three main Mission Priorities within navsea. Ontime delivery of ships and submarines, culture of affordability, and number three is cyber, for a very good reason. And the recent thing that everybody read about in the paper, the ransomware stuff, that gets our attention pretty quickly. Its real. The reality of it is that our ships and submarines today, theres not an hmne system or combat system on that ship that doesnt have you know, thats not heavily invested in software and computers. And even i just came from riding the trials on gerald r. Ford. Magnificent ship and shes got a machinery control systems that allows you to take 1,000 people off that ship that operates and the ship remotely and not having that sound and security watches some of the things that we did in our earlier days and thats great stuff, but all that stuff that has computers associated with it. So the cyber piece is not just, dont hack into my email, or get into my credit card. Its it goes a lot further than that on the ships today. So we, 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 have a chief Information Officer now. We have grown the size of my work force there on believe it or not, a lot of the cyber folks are in the engineering directorate. We have a Cyber Council that i meet with monthly and were working very closely on standards. So yeah we were as we, you know, grow navsea, and were going to we would have to grow navsea if we grow the size of the force. Were looking pretty close at the cyber piece of that. Thats a key point. Right. More questions. Megan, you had your hand up earlier . Megan, go ahead. No, right here. Hey, sir. Megan epstein. Since sydney did me the favor of asking me first question, ill ask you about the public shipyards. You mentioned getting the same maintenance availabilities done with fewer man hours. I was wondering if that would come as a result of upgrading the yard infrastructure as you mentioned or if that would take maybe rethinking how you approach the processes, how you innovate the procedures . Yeah, i think its a combination of all of those things. One, if you have ever been you know, i use ingles as kind of an example, after hurricane katrina, 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 rethink the way they laid things out, the way ingles is performing today, the new Construction Side of the house, theyre knocking it out of the park. Anybody that does Industrial Engineering would tell you that how your shops are set up and how you flow material can go a long way towards making you more productive. The second piece of it is the workers coming in today, training them and providing them with Training Facilities to get them up to speed quicker and providing them with the tools to be more productive. I think, you know, 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, you know, 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. They are 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 and so theres 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 with yeah, its another thing to put on the pile. Again, were fairly conservative about our use of new technology, but, you know, we we get there eventually. And if you go look at the ford today we do things that we wouldnt when i started back in 1981, that i never would have imagined we would have allowed ourselves to do. I think its a recognition that you have to embrace the technology. It does come with some risk. Particularly on the cyber side of the house. But if you dont recognize that this is the way people learn, this is the way we move information, i think were missing a great opportunity to get better quicker. Yes. Than we would otherwise. Right here in the front. On the end there . Hi. You mentioned the longterm plan for the public shipyards. Could you please be, like, more specific about what youre assessing in terms of investments and people . And when do you anticipate the study to wrap up . Is that study congressionally mandated or is that something that the navy is doing on its own accord . Its not congressionally mandated. We did a study back in 2013, Congress Asked us to plan. And were kind of sticking with that plan today. This is something that ive ask the for and cnos asked for. We approached the navy 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 how, you know, work flows and they mapped out where people had to walk to between the shops and 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. Weve made an investment to go out and do the same thing at the other three shipyards to go get somebody thats a formal industrial engineer, go look at the yards, go map out where are the existing shops today, where do people have to walk to to get the work done, and then where, if you were to optimize that, what would you do . So 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 four class carriers, for example, use 13. 8 kva power on the pier, so, and have a different cooling requirement. So weve got to upgrade the docks for those, as well. So, we have a longterm plan. Investment plan that weve, you know, ive shown to the cno, that includes both the dry docks and then the facilities and investments necessary to get there. Its not cheap. Were talking youre talking, you know, on the dry dock side of the house, probably over the next 30 years, you know, an investment of on the order of 3 billion to 4 billion necessarily to make the dry docks compatible. Those are musthaves, if you want to have virginia payload module and you want forward class carriers, you have to upgrade your dry docks. The second piece of that is the one where im competing with everybody else for the dollars, which is to make the investments necessary in the shipyards. So, yes, that plan, we have the basic outlines of it. I owe cno an answer back in the fall, and i think well finish up with full details in probably february what is ive told him of is today 2017 . Yeah, 2017. In 2018 in february of the next year, i have i think ill have a bow on this thing wrapped and up will lay out where i think we need to go from a navsea perspective. Im having this conversation with the defense committees. Theyre very supportive and want to help in this particular area. Ill move it over here. Sir . Hi there. Im mike stone from reuters. Hey, mike. 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 designed frigate, in terms of survivability, systems and breaking that down, and how that, if you can answer that, then, how that would compare to domestic design . I dont know that it would take you know, i dont know i dont think it matters where the design comes from, in terms of whoever develops the design, in terms of how long it would take us to evaluate it. I you know, i think the thought is here on Going Forward with the future frigate that 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 have to translate it from german or dutch or something, to do the analysis in terms of the survivability, so 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 burchess. Sea power magazine. Admiral, the nimitz class is halfway through its hrh cycles. Im won dooring is the ford designed to have a mid life, if so, would there be a gap between the last anymore admits and the ford going . Yeah, ford will have the ford class is designed for mid life for fueling, as well. Weve gone on submarine side of the house to life of ship corps. And, you know, we look at what it would take to get to, you know, a life of ship 50year core for a ford class and i think we concluded that while technologically feasible, it didnt make sense financially. You have to bring it in to a midlife overall and the refueling is only 10 and its not the critical pass. I think we concluded from a cost standpoint it just made sense to keep the refuelling in there. So we will refuel the ford class let me do the math in my head. Ford delivers yesterday, hell be around 50 years, so, her first rcoh would be in 2040, so bush was the last nimitz class and she will be around till 2057. So her mid life refuelling never do math in public, my staff tells me will be in 2030. So yeah, 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 gap is going to be we delivered bush in 2008, 09. And were delivering ford in 2017. There will be an eightyear gap between the refuelings. Well have to address that. There will be a lot of inactivations in the anymore admits class at the same time. So i suspect that will counterbalance if youre a new produce ship building in the 2040, 2050 time frame that would counterbalance some of the loss of the work are not having a consistent rcoh program. Okay. Over here, on the right . Evan daly, good morning. 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, two data sets. I see the one data set being stuff coming off of oem equipment, whether it be say, rollsroyce turbine. For example, we have a huge amount of data that comes off of turbines that fly through the sky on a commercial level all around the world. Provides us a really insightful way to do Predictive Maintenance on the aviation side. Now, thats commercial application. Within the navy, theres a lot of other data that can come off the ship that is the custodian is the u. S. Navy and you may have information coming off of oem equipment that is owned by, say, the oem. If you are trying to bring this information together and gain insights from it, how do you how do you see handling that . I mean, we talk about cyber, but how do we handle who owns the data, who protects it . And who is able to interpret it in a way that enables you to gain efficiencies . So one, im a big believer that the navy should own the data Going Forward. And youre right, we absolutely have a lot of data coming off our ships today. Dont make a we dont frankly make great use of it. You talked about rolls royce engines. Weve been the Navy Leadership has been up to General Electric to see what theyre doing in what they call digital twins, kind of the digital age in making decisions. I think thats a direction that we are absolutely needing to head in. So i have, you know, 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 ford class machinery and control system, we have the ability to collect vibration data, 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 absolutely driving us to go figure out, how do you make use of the big data to make better decisions Going Forward . And its across a whole host of different applications in my life, 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 got to get better at it. But to the data portion of it, you know, the navy needs to own the data. So that we can make some, you know, 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, you know, how much do you anticipate that o and m costs will increase as you get towards that 3 giveship number, and are you concerned that those o and m costs will eat into the amount of money available for procurement and new builds . Well, clearly, like a car, and 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, youre going to have you got to recognize up front youre going to have a higher o and m cost. If youre going to go into this, thinking you can grow the side of the fleet by 80 ships and that your costs are not going to go up, youve got a problem. So i think we recognize that the costs are going to go up. They are a little bit higher towards the last, later part of stages of life of the ship, but theyre not astronomically higher. But part of the way that you can keep those costs under control is to make a consistent investment and do the maintenance throughout the life of the ship. What we have found on the nimitz class, if you do the maintenance, you dont get any major anomalies. When you dont, then you have problems. So, you know, the classic example for us was theodore roosevelt, cvn71. You know, 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 kind of reset them. And tr missed out on that. And so when she got into her midlife refueling, if you were to look at how many man days should she have had typically at 23 years, she had significantly fewer man days of work done on her than in the first anymore admitted class. First 23 years of life than the first four three did, coming in. So, we had a very challenging refueling overhaul, not surprising. And so, i think youve got to, yes, it will cost you a little bit more towards the end of life, and we have to factor that into our plans, but the key is consistent application of the Maintenance Plan and make the investments necessary on a regular basis. If you do that, you wont have the major problems in the last five to ten years of the ships life. Thats kind of our experience. [ inaudible question ] you have to do the procurement. As i said at the beginning. You have to do the procurement, you have to do the maintenance. If you think we can get to 355 without adding in those accounts, thats not going to happen. We have to factor that into the equation. We have to talk honestly about the budget. But if you want to get to 355, you got to do both. You got to build and you got to maintain. If you skip on one of them, which has kind of been or who are, is to stop on the maintenance, then you run yourselves into trouble. So if were committed to 355 ships, weve got to be willing to go to make the investments on the maintenance side, as well. Im not concerned it would eat into the procurement side. I think we just have to do that eyes wide open. I do think that 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 bit more money up front so that the total Ownership Costs of the ship over the rest of its life comes down. And i think we dont tend to make those investments, the way the budget works is, that 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. And i think 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, we you know, for all the talk about how much the first ship costs, we did make an investment in that ship that would, you know, save 4 billion per ship over 50 years compared to a nimitz class carrier. Thats 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 you are a pleat commander 15, 20 years from now and you have several ford class carriers out there and the maintenance costs for that ships are significantly less, youre going to be happy that whoever was building the ford back in 2008 was smart enough to make the investments up front to reduce manpower and to improve the maintenance reliability of the ship. Okay. On the end, right there, with the 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 . Yeah, well, so obviously were not going to root for another hurricane. So i think, well, if you go look at the Ship Builders today, i think im satisfied the Ship Builders are making the investments that they need to make. You can go look at, you know, look at electric boat, look at newport news ship building today, for instance, some of the things that theyre doing to build facilities that will allow more work to be done inside. They have a thing at newport news called the unit outfitting hall, which is a significant investment which will allow them to get more work for columbia and do four class carrier inside. The challenge has always been on my side of the house is, you know, 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, have been willing to partner with them and share some of the costs if theyre willing to make some of those investments, in a cap ex environment. Im satisfied that the yards today that are out there competing for work are making the investments necessary to keep those yards competitive. And thats one of the great things about competition. If the competition incentivizes them to make the investments in addition 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 . If i need something i need that same type of thinking. To me, the investment is, i get more productive and therefore, i spend less o m dollars, back to this gentlemans question up front, 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. Naval county class of 1981. Just want to represent today. You made a point earlier about a resourceconstrained budget. If you could explain a little bit more about that, taking into consideration your service on the staff of n4, the role you played then on getting the maintenance dollars increased for after you left n4, and what are you seeing today among the resource sponsors . Does n4 play that same role . Or does that shift over to n9 . How does n6 play in all of that . How does that impact you and your budget . Well, were clearly, you know, 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 kind of faced that challenge. You know, the Organization Today places more of the role of managing the dollars with the n9 organization. N4 still plays a prominent role. In assessing what the requirements are. I think the process is more transparent and more open than ive seen it in the past. And so, you know, you need to the im going to get quoted on this, but, you know, the staff doesnt operate, sometimes in an enterprise fashion, in other words and it was designed that way. To provide you know, you head to n6, theyre pretty much focused on surface ships and builtin advocacy. Theyre the advocates for that. So they tend to advocate for that, and so, you know, i think what were trying to get after is, you know, an enterprise look that says, hey, where should the next dollar go to make the most impact for the navy . And i think the n9 organization in concert with n8, from what ive seen today in my 18 years in d. C. , its as good as its ever been. We are having that open discussion in kind of a Corporate Board manner, if you would, to decide, wheres the money going to go . What are the specific trades, you know, what happens if you put the dollar here, what happens what dont we do . And were more looking, instead of winners and losers, its really more of a, you know, getting back to the cnos constant question of, whats the navy we need . And so i think we are trying to work pretty hard to optimize the resources we have to get to the navy we need. So im satisfied that the processes that we have today, and were always kind of tweaking it and finetuning it to make it better, is pretty good and pretty robust. And, you know, the Navy Leadership we have over on that side is doing a terrific job of, i think, managing that, and i think everybody gets a voice in the process. As a result, i think we have a better outcome. We just have a few seconds left, and i see general gregson in the front row, so i have to ask this question. You know, there was some concern that especially the amphibs had not received the love and attention they need. We talked about the surface navy, but within the surface navy, youve got the those assets which are very large, very complex and important. Could you talk a little bit about recovering their readiness and are you satisfied and the cross talk between the navy and the marines on that . Well, ive got a marine on my staff who manages amphibious ships for me. The c21 staff, which does maintenance, talking to the marine corps all the time, n95 is a very strong advocate for the amphibious warfare branch. And where there may have been in the past a tendency to place resources on the nuclear side of the house, today i think we have robust class Maintenance Plans across the board. And, you know, we understand the service life requirements of the amphibious ships. Starting with lpd17, theyre being well maintained today. Were sending, about ready to finish up a maintenance available down in norfolk, shes going to be an fdnf ship. So im satisfied that were making the investments necessary there. Ive been on a lot of the amphibious ships, as well. I dont see any indication that theyre, you know, theyre the last person in line for the maintenance dollars. Right. You just mentioned wasp. She had to sit out for five to seven years because she had an obsolete combat direction system. So thats an example of recovery. Good one. Yeah. Wasp, so she just came back from a deployment at the end of 2016. And we immediately threw her into an availability to get her ready to be an fdnf ship. The crew and the contractor have done extremely well and we are close to getting her out of there and shell get over to japan and do great things over there. Well, thank you. Were going to have to cut it here, but we want to thank admiral moore for giving his remarks today and giving us the time he gave us for questions. Hes a very busy man with a lot on his plate. Like to also mention one more time our thanks for the generosity of our sponsors, Lockheed Martin and Huntington Ingles industry, without whom we couldnt bring you this Maritime Security dialogue. From csis and the navy institute, we thank you, we thank our audience and our speaker again today. Thank you. Lets give him a hand. We can send out more detailed information on it. You have the next question. Not right now. Something a little specific. You mentioned industry helping out with some of the submarine abilities. I know boise is set to go to a private yard. I was wondering if you could say which yard. I cant tell you what yard because its going to be competitively bid. Well see where that goes. 19 was where the capacity existed, was really the reality. Didnt have the capacity in the shipyard. So i had to get money in 18 to start planning it. And then the execution will be in 19. Really it was about where the capacity existed in the industry than anything else. Do you have any other attack submarines that are doing their full availabilities in a private yard right now, or is it just industry coming into the public yards to help out . No. Montpelier boise will go to one of those two yards. Going forward we want to keep this on the table as an option. I want to prevent another boise. As we grow the size of the work force and look at all the submarine work we have on the plate, im trying to get out in front of this to tell the commanders i dont have the capacity in the Naval Shipyard. If you go look at the list of submarines out there, there are several cases where were looking in the future that we may have to go to industry earlier than weve done today. I wanted to ask you about the budget documents. It said it was pushed to the right by ten months. Is like the George Washington going to take longer . No gw is not going to take any longer. Gw is going to start a year later, because we looked at whether we wanted to just inactivate it. Shes going to start here in august. One, the fleet needed her a little bit longer. Sunday night of afterwards, if you get too much of an overlap, newport news would have been doing gw, stanis and would have been building 79 and 80. That kd loo like a workload peek that was going to be a recipe for i dont want to say disaster, but would have caused some problems. Fleet wanted to move it. It fit the israel base need. I would say its a model for where i want to be in the future. The decision was made on stanis years in advance. Lets look at the work we have. The fleets needs come first. If we can meet the fleets needs and figure of a better way to level the work in both the Naval Shipyards and the private sector, well get the work done on time and youll get the work done cheaper if it can apply the resources. One Shipyard Concept when it comes to new builds, do you have any particular classes of ships in mind for that. For some shipyards, theres one ship in the building. Maybe i misinterpreted what you said. The one Shipyard Concept was on the maintenance side of the house where we used the resources from the entire Industrial Base like were doing today in Mount Pellier and columbus. We use newport news when we do carrier availabilities. In terms of new construction, competition is always going to be what were striving to get. The only place we dont have competition is for our Aircraft Carriers because theyre the only person that can actually hold it. Were looking to maintain competition. You mentioned service combatants, extend service lives across the board. Everything. When i talked today, cgs, ddgs, all your amphibious class ships, lcs and some of the logistic ships as well. If its a ship and floating today, were taking a look at what it would take to extend service life. When you talk about aluminum hulls i dont want to pre suppose a decision, all i said is we dont have the Knowledge Base on how that hull performs over a long period of time like with steel. What happens over 25 years, aluminum doesnt quite have the tensile strength, so youll have more flexibility in the hull. Weve seen this with some of the cracking on the Super Structures. Theres issues with as you operate the ship just from a stress standpoint and theres the whole sensitization issue. We have to look carefully well proceed a little more cautiously on extended service life. On amphibious, you said for five years probably on ddgs. Ive said you can easily get five years out of everything thats got a steel hull and probably get more. Last question . Going, going. Thank you all very much. Thanks everybody. Cspan, where history unfolds daily. In 1979, cspan was created as a Public Service by americas Cable Television companies and is brought to you today by your cable or satellite provider. Next, testimony from labor secretary Alexander Acosta on president trumps 2018 budget request. He talked about how jobs could be impacted if the Health Care Law is repealed as well as how to expand apprenticeship programs. This is an hour and 40 minutes. The appropriations subcommittee on labor, health, human services, education and related agencies will come to order. Good morning, secretary acosta, glad youre here and appearing before this