Moore. We are going to get started. Good morning. I am a senior fellow here. And i am delighted to kick off this mornings mari security dialogue. The dialogue represents a company hosted series. Seeks to highlight both current thinking and future challenges facing the navy, the marine corps and the cost gourt. And we look forward to welcoming you all back for additional events throughout the year. We would like to thank in a special way Lockheed Martin and huntingt huntington ingols industry. We would like to make a brief safety announcement. Should there be anything as a convener, we have exits in the back and stairs down the front and both myself and anthony bell in the back should be directors. So just look for one of us. And for our formal introduction, i am going to turn things over to vice admiral peter dally and we are happy to have him here. Welcome, i am pete daly. We are proud to bring you this series continuation now in our third year. We give special recognition to our sponsors. For making this event possible. Now i will introduce our speaker for today. 1981 graduate of the academy also holds degrees from George Washington skpu after serving mostly focused on refueling, complex, overhalls of Aircraft Carriers. Major command included Major Program managers for aircraft care rers and Program Officer for peo subs. I point out that there is over 75,000 uniformed and civilian employees of navsea which is entirely responsible for contracting and super vision of all navy and ship and sub ship building and responsible for the maintenance and be the shipments that go on those ships directly. So we welcome admiral tom moore who controls onequarter of the navys budget. [ applause ] i am always reminded of that. That is not necessarily a good thing. So good morning, and thank you for the invite this morning. Before i get started, so last night was a big night for the navy. One, my band, played live down at the water front. And what was the other thing that went on last night. Oh, yeah, we delivered the ford to the navy. So kooif a big night for us from my perspective. Having worked on it for most of the past ten years. And the 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 how to reset the fleet. And so what i would like to do is talk about this in the context of talking about where the cno is headed with the size and fleet and talk about what we are doing to grow the size of fleet and more importantly talk about how the maintenance side of that equation fits in. It is not, as we were talking beforehand, it is not either. You got to do both. And so sometimes we tend to forget about that. Having been a ship holder for the last 15 years. And also spent years on ship readiness. I am well aware that you have to do both, maintain what you got and continue to build forward. If you havent read the cnote, it is a good read. It is short. Lips do not get tired when they read it. And the cnos white pair is important. He makes three key points. And these are applicable whether you are talking new construction or the maintenance side of the house. Three key points is time matters. And that applies to across the board. To getting ships and submarines out and designing and getting them out quicker. The pace is exponential. If you look at the world today and the threats that we are facing, the learning that is going on in our near competitors, russia and china, and the pace is growing. We have to keep up with that pace. Kind of like we went into the half of a football up to 203 and we said we will get there when we get there. And we kind of strolled out midway through the Third Quarter only to find out that the squco was 28to 34. It is a key interest to us here on the navy side of the house. So a lot of discussion going on today about what is it, what is the navy that we need. And not necessarily what is the navy we need in the 2040s, but what is the navy we need in the 2020s. And we in figuring out, what is the navy we need 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 indepen department groups, about what is it the navy you 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 have today, they are all around the 340 to 350 ships. Clearly, the size of the fleet does matter and the capability of that fleet is also going to matter importantly, as well. So, you know, how do we get there from here . 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 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. 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. 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 weapon had in the original 3010ship plan. 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 fridgate. We owe some answers to the Congress Later on in that. As we head out, further out, you heard me talk about this before, the future service combatant, thats going to be critically important, as well. Kind of a new buzz word insi insiinside navsea, inside the pentagon is swap. 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. Ford class carriers are prime examples of kind of building in space, weight and power into the platform so 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 threea, were 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, 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 moin tan. The reality is, we didnt spend any money on that side. People thought, 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 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 mainvestments on the maintenance side of the house, you cant get there. The reality is, we were consuming the service life of the ships that was built into them 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. 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 . 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. 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 say, 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. 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 designs, the future service combatant is, we should not design a ship with a service life of 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 built in the swap 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 fye 18 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 Nuclear Powered 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 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 275 ships i have today, about a third of them at any time are under navseas control, either in a maintenance available or some pure side 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 eight 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. 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 work force. 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 and you can get them doing something useful in the yard is five years. We want to have somebody turn a wrench and do something useful in our ships in two to three years versus five. 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. 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, 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 eb and hi, newport news on 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 StrategyGoing Forward. Well start delivering ships and submarines on time. Take a very serious look at how we extend the expected service life of the ships that we have. 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 bet to 355 and may be able to get there sooner than we would otherwise get there by just 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, readyness today and build for the future, and its you can go back, all those 18 palms, whatever you said you worked on, and 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