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Wednesday, Feb 21, 2024

Change Ahead for Ship Repair Association

DEFENSE: Repair Work Fully Funded; Longtime President to Retire

The volume of U.S. Navy ship repair work on San Diego’s waterfront will likely “take a dip” in 2023, the outgoing head of the Port of San Diego Ship Repair Association said in a recent interview, though other signs are positive.

A federal budget is finally in place, some three months into the fiscal year.

Derry Pence
Port of San Diego Ship Repair Association

Congress provided more funds for ship repair than the president requested. “Maintenance across the Navy is fully funded,” said Derry Pence, the ship repair association’s president.

Congress also declined a Navy request to decommission certain ships, including almost-new Littoral Combat Ships.

Some repair cancellations are expected and the situation is “still somewhat fluid,” Pence said.

The association also announced that Pence will step down this month after 13 years at the head of the repair association.

Navy veteran Gordon Rutherford will take his place as president.

A Quarter of the Fleet

Some 24% of the Navy’s fleet is in San Diego. The region is home to 66 ships and that number is growing, according to the annual military economic impact report produced by SDMAC, the San Diego Military Advisory Council.

Ship repair is a business worth hundreds of millions of dollars annually. The task of repairing, repainting and upgrading surface ships in the region falls to private businesses. Unlike other ports, there is no Navy-run shipyard in San Diego. (U.S. Navy shipyards oversee maintenance on nuclear powered submarines and aircraft carriers in the port — though “topside” work on carriers might fall to a private business.)

The three master ship repair contractors in San Diego are General Dynamics NASSCO, BAE Systems San Diego Ship Repair and Continental Maritime of San Diego. Titan acquired the latter company from Huntington Ingalls Industries in 2020.

There are scores of maritime subcontractors in the area. The ship repair association represents upwards of 150 companies.

A Snapshot of the Waterfront

A representative from NASSCO in Barrio Logan reported that the business is approximately 93% complete on the Ticonderoga-class guided-missile cruiser USS Cowpens. The amphibious warfare ship USS Comstock is 91% complete. Work is ongoing on the Arleigh Burke-class guided-missile destroyers USS Pinckney, USS Curtis Wilbur and the USS Spruance, which arrived in November 2022 with a six-month availability.

Shares of General Dynamics trade on the New York Stock Exchange as GD. The business also builds ships for the U.S. Navy.

Next door, BAE Systems San Diego Ship Repair has six ships in its yard for work. The amphibious assault ship USS Essex occupies BAE’s recent addition, a 950-foot, 55,000-ton capacity dry dock. There is also the landing ship USS San Diego, two Arleigh Burke-class destroyers and the Zumwalt-class destroyer USS Michael Monsoor.

The Zumwalt and Monsoor — two futuristic-looking destroyers based in San Diego — are scheduled for modernization work that will let them carry hypersonic missiles. That work is will take place at the Huntington Ingalls shipyard in Pascagoula, Miss. later in the decade. It is unclear whether the ships will return to San Diego.

Pence, the ship repair association president, recalled that he first saw San Diego as an ensign in 1972. At the time, he was assigned to a destroyer. He worked his way up to supervisor of shipbuilding in Puget Sound, and retired as a captain. He then spent roughly a decade at NASSCO before taking the president’s job at the repair association.

Wrapping up 50 years on the waterfront, Pence said he plans to stay in San Diego.

“It’s been a kick, being able to work with all the companies” in the sector, he said. “I’ve really enjoyed it.”


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