Shipbuilding in San Diego

Located in the shadow of the Coronado Bridge is National Steel and Shipbuilding Corporation (NASSCO), San Diego’s premier shipbuilder.

The American shipbuilding industry never really recovered from the decline of the mid-1980s. There are now only a handful of shipyards and most are struggling, but San Diego’s National Steel and Shipbuilding (NASSCO) is the exception. With more ships waiting in the backlog than at any time in their history, and an efficient and flexible shipyard and workforce, NASSCO has its sights fixed on building more and better ships.

San Diego’s most successful shipyard was founded in 1905, when NASSCO started as a small machine shop and foundry in a rented storeroom at 7th and Market streets, known as California Iron Works. In 1906 the company moved to a new location at 11th and ‘N’ Streets, moving again in 1914 to a larger building at the foot of 7th Street to a site which contained a machine shop and foundry.

The economic conditions of the early 1920s were hard, and in 1922 California Iron Works went out of business. The company was taken over by US National Bank, which operated it as a foundry and machine shop, renaming it National Iron Works. The Great Depression took its toll in San Diego and, like many shipbuilding enterprises, National Iron Works closed in 1933. But C. Arnholt Smith later acquired the company and began investing in the yard, with an eye to expanding it. In 1938 National Iron Works purchased the Ingle Manufacturing Company, makers of industrial and marine ranges.

During the war years National Iron Works concentrated on constructing equipment for the war effort but did not build any ships. After World War II the yard started to receive orders for replacement shipping. The first boat built by what would become NASSCO was the fishing boat Juana, which was 52ft with a displacement of 40 tons, and was launched in 1945. A Mexican fishing company also ordered 17 shrimp boats and, to cut costs, the customer asked that the first five boats with a crew of six not be equipped with toilets or sinks, suggesting that the crew use a five-gallon can instead.

In 1948 the company bought the adjoining Lynch Shipbuilding Co with an eye to expanding their interests in shipbuilding. Accordingly, the yard was used to build barges and small tugboats for the US Army Transportation Corps. In 1949 the company was renamed National Steel and Shipbuilding Corporation. Eight years later, in 1957, NASSCO bought the adjacent Martinolich Shipbuilding Co to further expand the shipbuilding and dry docking business.

In October 1956 NASSCO’s first sliding slipway was built, which involved the largest single concrete pour in the history of San Diego. The slip was used to construct many vessels, with Lt Col. John V. D. Page launched down the slipway on 28 September 1957.

In 1960 NASSCO was acquired by a consortium comprised of Henry J Kaiser Co, Morrison Knudsen Co Inc, MACCO Corporation and FE Young Construction Co. MACCO Corporation soon sold its shares, and so by 1962 equal ownership had been reduced to Kaiser and Morrison Knudsen. During this era the management sought to broaden NASSCO’s interests to include aircraft and missile parts.

In 1961 a contract between NASSCO and the US Navy was signed for the construction of the first $18 million prototype combat stores ships AFS-1 USS Mars. During the next ten years the US Navy placed orders with NASSCO for six further ships of this class, including USS Niagara Falls, which was completed on 29 April 1967. NASSCO went on to secure a seventh Mars class vessel, USS San Jose, upon USS Niagara Falls’ completion.

Commercial orders

As well as military orders, commercial orders were also secured, and in 1971 an $83.6 million contract for three San Clemente class oil-bulk-ore ships was received. A year later, on 4 January 1972, President Richard Nixon visited the yard and promised to assist NASSCO in obtaining more work.

The 1970s were a productive time for NASSCO despite the machine shop being destroyed by fire in 1973. Infrastructure improvements continued, especially in 1975, when a large building dock was completed at a cost of $9 million. In 1979 the company won a $151 million contract from Union Oil for three product carriers.

If the 1970s were successful, the following decade was somewhat up and down.

NASSCO started the 1980s at an all-time peak employment level, with 7,600 workers in the shipyard and the US Navy market strong thanks to the Reagan Administration’s aims of a 500-ship US Navy. The commercial market was also in a good shape.

In 1980 the shipyard had work in hand on a 188,000dwt tanker, three Union Oil Product carriers, the first Ingram product carrier and four Yellowstone class supply vessels for the Navy. NASSCO was also working on construction of the US Navy cable-laying vessel USS Zeus. In the following years the yard built a second Ingram and three product carriers for American Trading and obtained the contract for the three Waterman mid-body conversions, as well as three SL-7 conversions in 1983.

The years of the Reagan Administration were tough for the shipbuilding industry in the US when, in 1981, the government slashed the construction subsidy and financing assistance to commercial ship operators. This took away the incentives American shipowners had to build ships in America, and cheaper vessels were built abroad. In 1982 Waterman Steamship Corp placed an order with NASSCO to convert three of its ships, while in 1983 a 25,000-ton capacity $21 million floating dry dock was ordered from the Kawasaki Company in Japan.

Despite this good news, in 1983, for the first time in NASSCO’s history, not a single keel was laid down. NASSCO did, however, re-enter the offshore drilling market with a $5.5 million contract to fabricate two modules to be mounted on deep-water oil drilling platforms. And the US Navy awarded NASSCO a multi-million dollar contract for five of the 17 NASSCO-built Newport class landing ships to return to the yard to receive regular overhauls in a deal worth $80 million. In 1984 a $250 million contract was secured for the construction of two Alaska class supertankers for the Exxon Shipping Co, one of which was Exxon Valdez.

The mid-1980s were a bleak time for worldwide shipbuilding, but particularly so in the United States. In fact, the US commercial ship market evaporated. President Reagan had eliminated the construction differential subsidy, causing the commercial shipbuilding market to disappear. In 1986 3,442 employees were laid off and, with the delivery of the second Exxon ship due in early 1987, new construction activity at NASSCO ceased.

A lifebelt was thrown to the shipyard by the US Navy who, in 1987, selected NASSCO to build a new class of combined oiler and supply vessels, the AOE. Also in 1987 tragedy struck when six shipyard workers were killed after a crane basket fell onto the US Navy supply ship USS Sacramento, which was under repair.

In 1987 NASSCO received a contract to convert the SS Worth (which the yard had built) into a hospital ship for the US Navy. After an extensive conversion, the supertanker’s interior was replaced by a modern hospital with over 900 beds, as well as operating theatres and extensive medical facilities. The vessel was subsequently rechristened USNS Comfort’

General Dynamics

In 1989 NASSCO became an employee-owned business. The yard continued to secure newbuild work on both military and commercial shipping and an increasing repair work, principally on US Navy vessels. In November 1998 General Dynamics bought NASSCO and made them the third of their US shipyards that make up General Dynamics Marine Group, the others being the Electric Boat Company and Bath Iron Works.

General Dynamics brought with them the financial clout that secured NASSCO’s future. Now NASSCO is one of the world’s most successful and efficient shipyards and has upwards of nine ships on the order-book, including two ferries for service in Alaskan waters, three transports for the US Navy and six Lewis and Clark oilers for the US Navy.

As the shipyard entered the 21st century, work continued to be secured from the US Navy both in terms of newbuild vessels and repair work on amphibious assault ships and destroyers based in San Diego. On 31 October 2011 General Dynamics acquired Metro Machine Corps, a surface ship repair company in Norfolk, Virginia and renamed it NASSCO-Norfolk, with the yard having the most modern dry dock in the United States at the time of the acquisition.

General Dynamics-NASSCO acquired the ship repair and coatings division of Earl Industries in January 2012. Earl Industries is a prime contractor for the US Navy, with a series of contracts to modernise and maintain nuclear aircraft carriers at Norfolk, Virginia and Mayport, Florida.

The facility at Mayport, adjacent to the maintenance piers of the US Navy base at Naval Station Mayport, covers an area of just two acres, but within this compact site are modern machine shops, electrical clean room and sheet metal workshops and a 30,000ft2 production building.

In terms of newbuild vessels, NASSCO has secured a contract to develop the US Navy’s new Mobile Landing Platform ships and construction of the first-of-class, Montford Point, starting in July 2011. The second ship of the class, named for former Mercury program astronaut John Glenn, was laid down in December 2012.

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