Post & Courier / By David Wren
Jon Miller started looking for a site a couple years ago where he could bring his company’s work for the Navy’s nuclear submarine program back in-house after subcontracting it out to a third party in Philadelphia.
In the end, the Charleston region was the only clear choice.
“We looked everywhere, from the Great Lakes all the way down the East Coast and including the Gulf,” said Miller, senior vice president and general manager of the Navy Propulsion division of Leonardo DRS. “Charleston really started rising to the top.”
DRS placed the final support beam on its $120 million, 140,000-square-foot manufacturing, assembly and testing site at the Bushy Park industrial complex in Goose Creek, where propulsion systems for the new Columbia-class ballistic missile submarine will be built. A $45 million expansion is already planned, even though work isn’t scheduled to start until later this year.
Arlington, Va.-based DRS is one example of a growing base of Navy contractors setting up shop in the Charleston area, creating a defense-related shipbuilding renaissance in a region where the industry had dimmed following the 1996 closure of the Charleston Naval Complex along the Cooper River.
They include companies like Curtiss-Wright, which designs and builds steam turbines in Summerville, and metal fabricator Keel Holdings.
More recently, Newport News Shipbuilding, a division of defense giant Huntington Ingalls Industries, started operations at a 45-acre site next to DRS. The Virginia-based company will make large metal parts for the Navy’s next-generation subs and aircraft carriers. It sent its first module to its headquarters less than 60 days after arriving in Goose Creek in late January.
“We’re starting to build this maritime synergy and ecosystem here that is really going to be special,” said Matt Needy, vice president of Charleston operations for Newport News Shipbuilding.
For Needy, the Charleston region was an easy call because that is where the workers are.
Newport News Shipbuilding acquired the former W International metal fabrication factory, and most of the roughly 500 employees who’d worked there agreed to stay on with the new owner. That gave the shipbuilder a ready labor force of skilled welders and machinists with experience building big metal structures for Navy vessels.
Newport News Shipbuilding also inherited a top-notch training program to get welders up to speed.
“The Navy needs those ships now,” Needy said, referring to the urgency to rebuild the nation’s warship fleet to head off China’s dominance.
“We could go make an investment somewhere else and it would take two, three years for us to be able to do what we’re doing here in just the first quarter” since closing on the acquisition, he said.
Miller also said speed was a primary reason for DRS, adding state and local development officials as well as Bushy Park’s owners were “very helpful at helping us expedite so that we can get to production as fast as possible.”
It could be argued that W International spurred the recent defense industry influx when it moved into Bushy Park in 2018, using $150 million in government funding to set up a state-of-the-art metal works site where large aircraft parts were built in a 480,000-square-foot facility complete with a barge slip on the Cooper River. Although W International’s founder left under the cloud of a federal whistleblower investigation, the work he did set the table for Newport News Shipbuilding’s arrival.
“We have all the elements needed here for a successful recipe to expand our business,” Needy said, adding he expects to hire hundreds of additional workers in the coming years.
Tony Deering was one of the few people running a metal fabrication business for Navy work before W International arrived, growing Pegasus Steel from a handful of employees cutting steel plates for military vehicles to a workforce of more than 250 people making structures weighing more than 800,000 pounds at three Lowcountry factories.
When private-equity firm Arlington Capital Partners created a $3.8 billion fund in 2023 to build a defense subsidiary called Keel Holdings, Pegasus was one of two South Carolina businesses it quickly snapped up.
The other was Metal Trades, a previously family-owned metal fabricator that’s been around for more than half a century. Keel recently announced plans to invest $70 million on new facilities at the site — a preparation and paint building, a fabrication factory for Columbia-class submarines and an employee center.
“If you look at the growth of Charleston last 10 to 15, years, it is becoming more of a manufacturing hub, and there is quite a population growth that’s occurred along with that. And so it … should grow into more of its own shipbuilding ecosystem, if you will, to support these priority Navy programs,” Brian Carter, Keel’s CEO, said on the company’s website. Carter could not be reached for comment.
Defense contractors add the Lowcountry’s weather and beautiful scenery is an easy draw for talent.
“I’ve got a big facility just outside of Milwaukee,” Miller, of DRS, said. “I don’t want to call out Milwaukee, but you can imagine the different responses I get when I say I have a job opening in Charleston versus a job opening in Milwaukee.”
Mission-critical
Foreign Policy magazine has called the 21st Century “a lost generation of shipbuilding, leaving the Navy unready at a time when China has already built the world’s biggest fleet, with more hulls splashing off its slipways every year.”
The Office of Naval Intelligence has concluded that China now has the world’s largest navy, by far, with an estimated 400 warships compared to roughly 300 for the United States. There are numerous reasons for the U.S. decline: post-Cold War budget cuts, a constricted supply chain, skilled worker shortages, a lack of shipbuilding facilities and others. Expanding the supply chain with new facilities in the Lowcountry is an attempt to reverse those trends.
“We know that our near-peer threats are real and working at an unrelenting pace in attempts to surpass other nations’ war-fighting capability, and this certainly includes ours,” said Capt. Reed Koepp, deputy commander of Joint Base Charleston. “Time is of the essence and we need more players on the field, meaning our ships.”
Expanding shipbuilding capabilities in the Charleston region “is just the news that warfighters need to hear,” he said.
Employees at the Newport News Shipbuilding site in Goose Creek wear T-shirts with the saying “the mission starts with us” emblazoned on the back.
“If we can’t give the Navy the ships they need, then they can’t protect our freedoms and do what they need to do overseas,” said Needy, the site’s general manager. “So, we are committed … to increasing capacity and throughput of what we do every day to get those ships out faster and maintain high quality and give the Navy what they need to do their job.”
The Charleston Naval Shipyard played a key role for the military in the years since it was established in 1901 and through World War II, assembling more than 200 ships, including 21 Navy destroyers, and employing nearly 26,000 people at its peak. In later years, it overhauled submarines and was a home port to a number of Navy destroyers, cruisers and attack submarines until its closure in 1996 as part of nationwide budget cuts.
Newport News Shipbuilding and others looking to build today’s warships point to Charleston’s proud tradition in the shipbuilding sector as a source of motivation.
“We have a great opportunity to grow and build Charleston’s maritime legacy, not only for the benefit of our economy here, but for our nation’s defense which is so vitally important,” Needy said.
Every commercial ship and military vessel coming through Charleston Harbor passes a clear reminder of the region’s ties to the Navy as they sail past the USS Yorktown, Koepp said. The Essex-class aircraft carrier and National Historic Landmark is moored in the harbor as part of the Patriots Point Naval and Maritime Museum.
“A decorated warship, multiple battle stars during World War II, Vietnam War, Apollo recovery missions and now it houses the Medal of Honor museum,” Koepp said during a talk with Navy contractors this month in North Charleston. “That ship was built by, guess who — Newport News Shipbuilding. And it was done so in an amazing 16 1/2 months.”
Koepp said the nation’s shipbuilding mission was clear when the Yorktown was commissioned in 1943 during the midst of the second world war. With a growing number of conflicts around the globe these days, he said, that mission remains vitally important.
“Your work here enables the protection of our greatest treasure — the privilege to live in the free land that we call America,” he said.