The shipbuilding industry is considered a very traditional business that experiences long transitional periods to implement major changes, especially in its approach and execution of major business and cultural changes. This reluctance to adopt major changes is mainly due to the industry’s long product development and build cycles compared to other industries, such as automobiles and airplanes. The loner ship cycle, which can be as long as 10-20 years for military builds, is much longer than the cycles typically found in other industries, which are on the order of 1-5 years. Pressure to change in the shipbuilding industry has typically been forced due to economic conditions, wartime efforts or the introduction of new and improved technologies required by customers. Sequestration has recently placed increasing pressure to reduce the cost and number of military ships sponsored by the Federal Government. The key driver to this is our country’s overall economic climate, as well as the global economy. Consequently, this global cost pressure is affecting both military and commercial construction worldwide. Every day, our industry news sources discuss our Government’s shortage of naval shipbuilding funds and the need to cut the number of and the cost of each of these designs. Global shipbuilding orders are down due to overcapacity and reduced customer demand. The US shipbuilding industry is facing some very critical challenges, both domestically and internationally. These challenges must be addressed so that our industry can maintain its national strategic capability.

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