Austal USA broke ground Tuesday on a massive new assembly hall that will double its shipbuilding capacity and provide workspace for an estimated 1,100 new jobs in Alabama.
The Mobile-based shipbuilder says the new building, to be known as Final Assembly 2 or FA2, represents a $250 million investment and will provide 192,000 square feet of workspace “which will enable the erection of large steel modules for Navy and Coast Guard ships, including the Offshore Patrol Cutter (OPC) and T-AGOS programs.” The OPC is a Coast Guard ship, while the T-AGOS is a Navy ocean surveillance class. Austal has contracts in hand for both.
While the new hall will facilitate Austal’s rapid transition into steel shipbuilding, it was clear at Tuesday’s groundbreaking ceremony that the process is well under way: A portion of a massive steel drydock that Austal is building for the Navy loomed nearby, blocking out part of the Mobile skyline.
“It was not long ago, March 2021, we had the most recent groundbreaking when we met to break ground for a steel panel line not too far to the north,” Larry Ryder, Austal USA’s vice president of business development and external affairs, told an audience of state and local economic development officials and officeholders. “Thank you for coming back in April of 2022 [when] Governor Ivey joined us to cut the ribbon on our new steel panel line facility. That facility is operational and has enabled us to build large steel modules. Those modules will be transported to this new building, Final Assembly 2, where the vessels will be erected and launched.
“So what exactly are we building?” Ryder continued. “When complete this new building will almost double the capacity of all of our existing assembly bays and will enable the erection of large steel modules for the Navy and Coast Guard ships … In addition to the manufacturing capacity of these new buildings, the expansion includes a ship lift that will provide a safe and reliable system to launch ships as they are completed in the assembly buildings. The ship lift will also enable bringing ships back on the land side facility for repair and maintenance.”
Michelle Kruger, who was confirmed as Austal USA’s president in April after a period as interim president, said the 25-year-old shipyard was just getting started.
“We’ve all heard of dog years, but we probably haven’t talked about shipyard years,” she said. “But in shipyard years, Austal is very much in, maybe, I would say, infancy to toddler [years] in comparison to some of the other bigger companies with shipyards that have been here a century or more. And I have to say that when you think about that, we have done an amazing amount of work and expansion in the last 25 years.”
“Austal USA is once again answering the nation’s call to expand the defense industrial base to meet the needs of our military,” Kruger said. “The secretary of the Navy and the chief of naval operations have called upon industry to step up and invest in our facilities. The secretary called upon industry to move at flank speed to make fundamental investments in the industrial base. Austal USA is answering that call today. Our $250 million investment is a clear statement of our readiness to invest when we have a clear demand signal.”
Ellen McNair, who took office as Alabama’s Commerce Secretary in January, also spoke.
“This is the type of company and the kind of project that helps define our state,” said McNair. “It truly does. And I want to thank Michelle, your company, for 25 years of investment and reinvestment to the state of Alabama.”
Austal USA currently has two large assembly halls on the Mobile River waterfront directly across from downtown. The new hall will sit to the south of them on the other side of the facility where Austal makes the modules that are then pieced together to form vessels such as the Navy’s Independence-class Littoral Combat Ships.
Ryder said the placement comes with a very important advantage. Currently modules must pass over the Wallace Tunnel and in some cases also the Bankhead Tunnel on their way into the old assembly halls. There’s a weight limit, and steel is heavier than aluminum.
When FA2 is up and running, that won’t be an issue: Modules transferred there won’t pass over the tunnels.
Ryder said the Austal USA workforce is about 3,100 people at the moment. The opening of FA2 will create a need for about 1,100 more workers. “We’re ramping up as the building goes up, we want to have the workforce ready when the building opens,” he said.
More construction is coming, as are more jobs. Austal has landed contracts for work assembling modules that will go into nuclear submarines. Austal said a building will be constructed to house that work, which he said will employ about 800 workers.
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