Shipping and Logistics

Steel Shipbuilding Coming to Mobile’s Austal USA

Written by Sandy Williams

Southern steel producers and distributors will have a new customer in 2022. Shipbuilder Austal USA, located in Mobile, Ala., broke ground last week on a steel manufacturing line to build steel ships for the U.S. Navy and Coast Guard.

Austal USA is known for its construction of aluminum vessels, delivering 24 ships to the Navy in the last nine years. The new manufacturing line will utilize high-strength and corrosion-resistant steel plate to construct steel ships. The addition of a steel manufacturing line will allow the company to bid for a wider variety of contracts.

“As demand for the greater and larger Navy and Coast Guard fleets grows, Austal USA is investing to meet those changing requirements,” Rusty Murdaugh, Austral USA interim president, said. “We’re investing in our people, we’re investing in our processes, and we’re investing in our facilities and capabilities.”

Last June, Austal USA was awarded $50 million from the Department of Defense under the CARES Act. DOD spokesperson Lt. Co. Mike Andrews said the award “will protect jobs and bolster the local economy in a region hit hard by the COVID-19 pandemic and ensure critical capabilities are retained in support of U.S. Navy operational readiness.” The company’s Australian parent, Austal Limited, is matching the funding for a total investment of $100 million in the Mobile facility.

“Each time we have invested in our facilities, our customers have seen a greater return on their investment,” said Murdaugh. “The steel ships that will come off this line will be the best, most efficient and most affordable steel ships in the Coast Guard and Navy fleets.”

AustalShipIn February, Austal USA was awarded a $235 million contract by the U.S. Navy for the design and construction of the 15th Expeditionary Fast Transport (EPF) vessel, a high-speed aluminum catamaran. Austal USA only has six more aluminum ships to deliver for the branch’s terminated Littoral Combat ship program. The Navy is focusing on a new class of frigate that will be built by another company, but Austal USA sees potential for new contracts from the Navy’s long-range strategy for the fleet.

In December 2020, the Navy released its long-range plan for the construction of naval vessels. The report describes the Navy’s priority to grow the fleet to 316 ships by 2026 and 546 by 2045, including a platform of unmanned surface and sub-surface vessels.

“The industrial base continues to be the fundamental enabler for achieving and sustaining the Navy’s future fleet,” said the Office of the Chief of Naval Operations in its report to Congress. “Our shipbuilding and supporting vendor base constitute a national security imperative that must be steadily supported, and grown, to maintain a skilled workforce. Consistent commitment to the steady acquisition profiles underlying this report is required to ensure the industrial supplier base achieves the capability and capacity required to build and maintain the Navy’s future fleet.”

A number of steel producers and plate suppliers in the South stand to benefit from the Austal USA investment. The steel manufacturing line is expected to begin production in April 2022.


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