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SCA Weekly Report | August 26-30, 2019

Shipbuilders Council of America

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SCA Weekly Report | August 26-30, 2019


Hurricane Dorian Update


SCA is monitoring Hurricane Dorian as it approaches Florida this weekend. We hope that all SCA members and their families stay safe.




Register Now for the 2019 SCA Fall Membership Meeting


Registration for the 2019 SCA Fall Membership Meeting is still open. The meeting will take place at the Marriott City Center in Newport News, Virginia. Registration for the SCA meeting is $650 per attendee.



  • Jennifer Boykin, President, Newport News Shipbuilding
  • Mitch Waldman, Executive Vice President of Government and Customer Relations, Huntington Ingalls Industries
  • Bryan Caccavale, Vice President of Strategic Sourcing, Huntington Ingalls Industries
  • Nancy Sopko, Co-Director, Special Initiative on Offshore Wind
  • Laura Morton, Senior Director, American Wind Energy Association (AWEA)
  • Jim Bennett, Chief of the Office of Renewable Energy Programs, BOEM
  • RADM William Greene, Director- Fleet Maintenance- U.S. Pacific Fleet, USN



  • Offshore Wind Energy Panel
  • Newport News Shipbuilding Supplier Panel



  • VADM Michael Gilday, Chief of Naval Operations, USN
  • VADM David Lewis, Director- Defense Contract Management Agency, USN


A full schedule of events can be found HERE.





Thank you to the following companies for their early commitment to exhibit at the Fall Meeting:

Tri-Tec Manufacturing

Aerotek Recruiting and Staffing

National Inspection Consultants

Radco Industries

Ryzhka International, LLC

STI Marine Firestop


MCG Workforce Solutions

Gibbs & Cox



Tradesmen International

Ameri-Force Craft Services


For more exhibition information, please review the Exhibition Packet. 




Proposed EDA Transfer: SOC-R Boats to Hungary

The Navy is requesting the transfer of two Special Operations Craft-Riverine (SOC-R) boats to Hungary under the Excess Defense Articles (EDA) program. The boats will be sent to the Original Equipment Manufacturer for refurbishment. Please notify Lee Ann Carpenter of the US Department of Commerce with any comments or questions. I will need to hear from them by Friday September 6. A non-response will be considered as agreement to the EDA transfer. Her contact information is as follows:


Lee Ann Carpenter / Bureau of Industry & Security / US Department of Commerce / 202-482-2583 / LeeAnn.Carpenter@bis.doc.gov




Geurts: Navy Must Provide Clearer Parts Demand Signal to Submarine Builders, Maintainers

To prevent submarine construction and maintenance delays, the Navy needs to provide its supplier base with a broader understanding of parts and equipment demands, the service’s top acquisition official said Tuesday. Submarine parts suppliers are struggling to keep up with demand from the Navy, which is simultaneously building and maintaining a fleet of Virginia-class submarines while embarking on a massive program to build the new Columbia-class of ballistic-missile submarine. Geurts said the Navy could do a better job of effectively gathering information about what the parts and supplies needs for both building new submarines and maintaining current ones. More detailed information on the demand for parts across both the construction and maintenance enterprises would allow companies to determine whether it’s the right time to hire more workers, expand facilities and purchase new machinery.




Pacific Deputy: Coast Guard a Continuing 'Force Multiplier' with Navy in Global Missions

The Coast Guard’s ability to fold into the U.S. joint armed forces to protect America’s interests globally has “never been more relevant,” a senior Coast Guard officer in the Pacific region told the Surface Navy Association West Symposium Thursday at Naval Base San Diego. The Coast Guard, “always a law enforcement agency but also a military force, is well-positioned to do home military security missions and homeland defense missions and defense operations around the world, right alongside their Navy brothers and sisters,” said Rear Adm. Dave Throop, deputy commander of the Alameda, Calif.-based U.S. Coast Guard Pacific Area.





U.S. Navy Boosts Cybersecurity by Moving ERP to the Cloud

The U.S. Navy has completed its largest-ever migration of computerized business systems to a cloud computing environment, the service announced Friday. The Navy's Enterprise Resource Planning suite, which manages about half of the service's annual spending, now lives on a cloud platform rather than an in-house Oracle-based server system. It is the first time that the Pentagon has moved a large-scale business IT system to a commercial cloud service. The Navy says that the migration will make the user experience faster and simpler for 72,000 service members across six Navy commands. It also marks a step towards integrating all the Navy's financial systems into a single general ledger and achieving audit compliance, according to Thomas Harker, who serves as the Navy's equivalent of a CFO. 


DOD Awards Potential $7.6B Cloud Contract to GDIT

The General Services Administration and the Defense Department have awarded the potential 10-year, $7.6 billion Defense Enterprise Office Solution cloud services contract to a team lead by General Dynamics Information Technology. The DEOS Blanket Purchasing Agreement provides for collaboration and productivity tools like email, messaging, word processing, file sharing and storage across the DOD enterprise, according to today’s award announcement, which states the BPA was awarded to CSRA and its “contractor teaming partners” Dell Marketing and Minburn Technology Group. CSRA was acquired by General Dynamics in 2018. The DEOS services will be used to “replace legacy DOD IT office applications with a standard cloud-based solution across all military services,” according to the announcement




China Tariffs on U.S. Oil to Pressure Exports, Gulf Coast Prices

China’s threat on Friday to slap a 5% tariff on U.S. oil imports could further soften demand for physical crude at hubs along the U.S. Gulf Coast, where exporters already have taken to shipping crude overseas without firm buyers, traders said. The tariff on oil imports would likely “shut off flows from the U.S. to China,” leaving exporters to market a rising tide of shale oil to South Korea and Japan, said John Coleman, an oil analyst at consultants Wood Mackenzie.




Report author stands by Jones Act analysis

American Shipper – John Dunham – 29 August 2019

John Dunham & Associates recently completed an analysis for the Chamber of Marketing, Industry, and Distribution of Food in Puerto Rico on how the high cost of shipping, due to the Jones Act, impacts the economy of Puerto Rico. The study examined a range of differential costs from other sources and applied them to a standardized shipping model.


An Opportunity for Trump to Lead on Jones Act Reform

Cato – Colin Grabow – 26 August 2019

President Donald Trump and U.K. Prime Minister Boris Johnson met on the sidelines of the G7 summit this weekend, and among the issues discussed was a possible U.S.-U.K. free trade agreement. In public remarks Johnson made clear his desire that such a deal include cabotage privileges for U.K.-flagged ships.


Millions Of 'Citizens' In The U.S. Have No Guaranteed Rights

Forbes – Erik Sherman – 26 August 2019

If you're from Puerto Rico you have a U.S. passport and certain rights of property and constitutional protections. But what Congress can deliver, Congress can withdraw. You have no direct representation in the House or Senate, which means no say in financial matters. Given the impact congressional actions have had on the island—like how the 1920 Jones Act prevented non-U.S. built, crewed, owned, and registered ships from carrying relief goods from the mainland after Hurricane Maria—having a voice would seem reasonable.


A Pathway to Puerto Rico’s Recovery

The Weekly Journal – Cynthia López Cabán – 28 August 2019

How can we get rid of the Jones Act? “Congress does not understand half of what they are passing legislation on, and that is why I think it is going to need the help of the industry groups to say ‘look if you want to see Puerto Rico back on its feet there are very outdated things that have to be addressed.’ I think industry groups are going to be your most powerful vehicle to get the knowledge and understanding of the things that have to get done transferred,” Conway, a frequent speaker for the Federal Reserve, explained.


Politico Pro Morning Trade: Scrapping Jones Act?

Politico – Hans Vor Der Burchard – 16 August 2019

Trump wants a trade deal with the U.K. by summer 2020, U.K. Prime Minister Boris Johnson said following their meeting at the G7 summit. Johnson also made clear he wanted a U.S.-U.K. trade deal to get rid of the controversial Jones Act which bans foreign ships to navigate from one U.S. port to another. "Donald, what we want is for our ships to be able to take freight, say, from New York to Boston, which at the moment they can’t do. So, we want cabotage. How about that?" Johnson asked his U.S. counterpart.








China Says it Confronted U.S. Warship Near Contested Islands

China identified and warned a U.S. navy destroyer near South China Sea islands on Wednesday, according to a posting on People’s Liberation Army’s southern command’s WeChat account. China said it firmly oppose U.S.’s “so-called navigation and overflight freedom”, adding that it severely damaged China’s sovereignty and security, and jeopardized peace and security in South Sea area; China said its armed forces will take all necessary measures to guard the country.  The USS Wayne E. Meyer, a Arleigh Burke-class destroyer, sailed within 12 nautical miles of Fiery Cross and Mischief Reefs “in order to challenge excessive maritime claims and preserve access to the waterways as governed by international law,” the U.S. 7th Fleet said in a statement to several media organizations, adding the U.S. will continue to “fly, sail and operate wherever international law allows,“ including in the South China Sea.


Insight: Practical Effects from the Supreme Court’s Decision Limiting Punitive Damages for Sailors

The U.S. Supreme Court’s recent decision that sailors injured aboard unseaworthy ships can’t seek punitive damages from shipowners resolved a federal appeals court split. The U.S. Supreme Court’s June 24 opinion in Dutra Group v. Batterton (2019), resolved a split among federal appellate courts by concluding that punitive damages are not available in a general maritime law unseaworthiness action brought by a Jones Act seaman. Read more HERE.


DOT Awards $32.8 Million in Passenger Ferry Grants

Earlier this month, the U.S. Department of Transportation’s Federal Transit Administration (FTA) announced approximately $32.8 million in project selections to improve the safety and reliability of passenger ferries and enhance mobility for ferry users across the U.S. A total of nine projects in nine states will receive funding from FTA’s Passenger Ferry Grant Program. FTA Passenger Ferry Grant Program funds projects to purchase, replace or rehabilitate passenger ferries, terminals and related infrastructure and equipment.


Scrubber Retrofitting Driving Spike in the Charter Market

Ocean carriers are biting the bullet and agreeing charters for significantly higher daily rates as markets tighten ahead of IMO 2020. The IMO’s maximum 0.5% sulfur content regulation for maritime fuel becomes law in less than 120 days and is widely seen as a ‘game-changer’ for the shipping industry. Dry docks are said to be full of vessels requiring the fitting of scrubbers, and reports are emerging of the installation process taking some two weeks or more over estimates of 25-30 days, creating further uncertainty for fleet operators. 


Gulf Island Constructing Passenger/Vehicle Ferry for Texas

Gulf Island Fabrication Inc. is building a new 495-passenger, 70-vehicle, double-ended ferry for the Texas Department of Transportation. The vessel will be built at their Jennings, Louisiana, facility, with delivery scheduled for late 2021.


Crowley Building New ATB for Alaska

Crowley Fuels has signed construction contracts to build a 55,000-bbl., articulated tug-barge (ATB) that is specifically designed to serve the Western Alaska market with delivery of clean fuel products. Master Boat Builders will build the tug, and Gunderson Marine LLC will construct the 350′, 55,000-bbl. tank barge. Construction on the barge will begin in the first quarter of calendar 2020, and delivery of the ATB is expected by January 2021.


American Shipping Company says Jones Act tanker market up

TradeWinds – Matt Coyne – 26 August 2019

Jones Act tanker rates are surging, according to American Shipping Company. The Oslo-traded US-flag shipowner said time charter fixtures were hitting $60,000 per day in its second quarter earnings report Monday. “It is encouraging to see that the overall market dynamic is playing out as expected with… new time charter contracts being secured at higher levels compared to last fall,” said chief executive Pal Lothe Magnussen. “We expect this market development to continue going forward, resulting in gradually improving market conditions.”


SOV specialist plans foray into US offshore wind market

Rivera – David Foxwell – 27 August 2019

The last 18 months have seen vessel owners target the fast-growing US offshore wind market. Among the latest is the Danish company that pioneered the concept of service operation vessels (SOVs). Speaking exclusively to OWJ, Esvagt deputy chief executive Kristian Ole Jakobsen says the US market was the logical next step for the company, which is already a leader in the market in the North Sea and Baltic. “The North American offshore wind industry is emerging and Esvagt sees significant potential in bringing its competence and track record to the US market,” Mr. Jakobsen says. “Most global companies in the offshore wind industry are looking at the US,” says Mr. Jakobsen. “We have taken a decision to enter the market on the east coast and are looking for a partner.”


Dutra Launches New Hydraulic Dump Scow ES15

Dredging Today – 27 August 2019

Dutra Group has launched its new 6,000cy Hydraulic Dump Scow built in Corn Island Shipyard, Grandview, Indiana. The launching ceremony took place on August 20, 2019. Following the launching, christening and commissioning of the Dump Scow ES15, the vessel will finish sea trials and additional testing this week.



If you have any questions, please do not hesitate to contact Paula Zorensky on the SCA staff.