THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Wednesday, May 3, 1995 TAG: 9505030473
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: ASSOCIATED PRESS
DATELINE: NEWPORT NEWS LENGTH: Medium: 52 lines
Newport News Shipbuilding & Dry Dock Co. has submitted a bid to build up to five warships for the Kuwait navy.
The project, valued at up to $1.3 billion, marks the Virginia shipyard's second attempt to sell ships to a foreign navy since it unveiled its frigate design more than three years ago.
Yard executives expect to hear later this year on a bid to build four ships for the United Arab Emirates. A decision on the Kuwaiti contract is expected by October 1996.
The shipyard has been shifting from U.S. Navy work in recent years by seeking jobs for foreign navy construction and commercial shipbuilding.
The yard's payroll is down to just under 20,000, from a high of nearly 30,000 during the Reagan administration's Navy buildup. Executives say they plan to pare the work force to as low as 14,000 by the end of 1996.
Newport News has considerable competition for the Kuwait work. Industry analysts say Ingalls Shipbuilding and Trinity Marine Group, both in Mississippi, as well as shipyards in Germany, France, Italy, Canada, the United Kingdom and the Netherlands, bid on the project.
But as a U.S. builder, Newport News may have a leg up on the international competition, said Guy Stitt, a naval analyst.
``The U.S. is probably in a better position than most because of what happened in the Persian Gulf War,'' Stitt said. ``It's sort of a political debt.''
The United States came to Kuwait's aid after Iraq invaded its neighbor in August 1990.
While Ingalls already has made a name for itself in the foreign warship market by delivering three frigates to Israel, Kuwait and Israel are not allies and may not want to have similar ships, Stitt said.
``That may create an underlying prejudice against Ingalls' proposal,'' he said. ``That's a plus for Newport News.''
Trinity, he said, has built few warships like the frigates Kuwait expects to order.
Kuwait lost all but two of its navy vessels in the war with Iraq and is looking to buy between three and five frigates.
Newport News proposed to build a smaller version of its FF-21 - named for fast frigate for the 21st century - that it's been marketing internationally since 1992, said Mike Hatfield, a Newport News spokesman. Adapting the model shouldn't be much problem since the ship was designed by computer, Hatfield said. by CNB