>While thousands rally for its future and brace for layoffs and sweeping economic impacts, Avondale Shipyard's owners admit it's still too early to say what its plans are for one of the Gulf south's largest employers.
On Oct. 1, several hundred union members marched from the foot of Champions Square near the Louisiana Superdome to the Hale Boggs Federal Building along Poydras Street. Their message was clear: "Save Our Shipyard." That shipyard is Avondale, the sprawling West Bank shipbuilding facility that employees several thousand people from the metro New Orleans area. In July 2010, Northrop Grumman announced the shipyard is expected to close in 2013, with rolling layoffs of more than 4,000 employees. Its owner, Northrop Grumman-spinoff group Huntington Ingalls Industries (HII), has no immediate plans to sell it, and may instead cash in on an anticipated $271 million from the U.S. Navy for what HII believes will save millions of dollars in Navy spending. HII plans to consolidate all of its Gulf Coast shipbuilding in its other facility in Pascagoula, Miss. Local and national campaigns fight, hope (and pray) to keep Avondale open — and the march (and the rally that followed) offered another platform for hundreds of union members, laborers, families and elected officials to do just that.
Mayor Mitch Landrieu, standing on a truck bed in front of the Superdome on a clear late morning, kicked off the march. "Everyone (here) helped rebuild America," he told the crowd, adding that the shipyard's importance to New Orleans is immeasurable.
But is HII even considering a sale? A Pray for Avondale campaign last month asked faith communities to consider the livelihoods and future of the shipyard. Several potential "buyers" have since approached HII, and elected officials have taken a more visible role in pressuring the state to find some way to keep the yard open beyond 2013. Have those prayers been answered?
Before the march moved up Poydras, members of the NAACP, International Brotherhood of Electrical Workers, AFL-CIO, United Steelworkers and others (boilermakers, teachers, musicians and several other local union affiliates) shouted their affiliations in a roll call for those marching. Leading the march was Rev. Jim VanderWeele of New Orleans Interfaith Worker Justice, which co-organized the Pray for Avondale campaign.
Signs throughout the march read "Mitch Landrieu Don't Know, Don't Care," with others substituting Gov. Bobby Jindal or Rep. Steve Scalise, R-Jefferson, for Landrieu's name. Chants broke out: "For our families, we work hard. Help us save Avondale Shipyard."
The march and rally (organized by Save Our Shipyard, a campaign led by the Metal Trades Department of the AFL-CIO) touted a prospective "buyer" (though he admits there is no real "seller" yet): Percy Pyne IV, CEO of American Feeder Lines. With American Feeder Lines, Pyne wants to use the in-place employees and facilities to build 10 small cargo ships (for which he already has orders) at $75 million each, with possible plans to build more, keeping the shipyard open beyond 2013.
"If we do not have our commercial shipyards, if we do not have Avondale ... the country will collapse under its own infrastructure funding crisis," Pyne told the crowd. "I'm pleased to be here. We want to build ships. I suspect all of you know how to build ships. Anyone who's worked on a ship, would you raise your hand, please?" Almost everyone there did so.
How ready is HII to make a deal? Randy Belote, vice president of strategic communications for Northrop Grumman, said the company "completed the spin-off of Huntington Ingalls Industries in March of this year" thus Northrop Grumman has "no comment or insights" on the terms of the shipyard's sale and its worth.
Beci Brenton, HII's corporate director for public affairs, explains that "the cost savings associated with closing the Avondale shipyard relates to all of the costs associated with operating a large industrial operation being eliminated from the government cost footprint. These costs are being eliminated from the cost of future Navy ships as the Pascagoula shipyard has enough capacity to satisfy all future requirements."
As far as HII's willingness to sell the shipyard, Brenton says it is "working with federal, state and local officials to explore other uses for these facilities," but, Breton says, "it would be inappropriate to speculate about possible outcomes at this time."
Louisiana officials and candidates have made clear their support: Scalise and U.S. Sen. Mary Landrieu both issued statements supporting the rally; Jefferson Parish President John Young said the decision to close Avondale is about the future of "our children and grandchildren"; Democratic gubernatorial candidate Tara Hollis said in a statement she "will work with those in Washington and the State of Louisiana to keep the Avondale Shipyard open."
U.S. Rep. Cedric Richmond, D-New Orleans, made the most colorful and well-received speech at the rally. Richmond's attempts in Congress to block HII from receiving federal funds to offset Avondale's closing costs failed 246-177.
"When you're telling me we have a shipyard that builds the best ships in the country, you have people that work there, for generations, that give blood and sweat to make sure those ships are the best in the country, to close it down, when you're not losing money is sinful, shameful and wrong," he said.
Darlene Davis has worked at Avondale for 18 years and now is the only female ship rigger in the yard. "We have our families, we have our kids. ... We're here, we're collective, we're together," she told the rally crowd. "With the help of our politicians ... we need you."
"This is about saving Avondale and the shipyard," said Tiger Hammond, president of the Greater New Orleans AFL-CIO. "This is about the largest private employer in the state of Louisiana ... closing down 5,000 jobs. ... Huntington Ingalls, keep the shipyard going. Keep these 5,000 workers and 6,000 support workers. And if you don't want to, get the hell out of the way and let someone else do it."
Avondale opened in 1938 as the Navy's largest shipbuilder. Its nearly $2 billion economic impact rivals the state's fishing industry as Louisiana's most profitable. (Shipbuilding in the Gulf Coast generates nearly $12 billion annually, according to SOS.) Avondale workers are predominantly African-American, and the workforce's median income is $43,000. The shipyard employs thousands of people from the metro area, and thousands of people in surrounding communities live and work under the shipyard's economic shadow. SOS fears Avondale's closure would depress property values, close small businesses, and create a trickle-down effect rippling through the metro area.
In her statement of support read at the rally, Sen. Landrieu wrote she is "committed to doing everything in (her) power to bring business to the shipyard," noting the range of skill sets and trained workers that will be left without a job if the yard closes.
Pyne also recognizes those workers. "You have the workforce — good, skilled, trained people, "he says. "Skilled welders, pipe fitters — it's hard to find them."
State Sen. J.P. Morrell, D-New Orleans, and Rep. Robert Billiot, D-Westwego, marched among dozens of groups. "It's a nuclear bomb," Morrell said of the economic impact of a potential Avondale closure. "And the state doesn't have a sense of urgency."
Billiot, who served as mayor of Westwego for 18 years and now represents the district in Baton Rouge, said the closure's ripple effect will cost an additional thousands of jobs.
Pyne, speaking under a nondisclosure agreement, told Gambit a deal to keep Avondale open is on the table with HII. "Everybody's trying. 'Can you build ships at Avondale if everybody wanted to?' Yes. Undoubtedly," he says.
So where's the roadblock?
"We have to overcome a reluctant owner," AFL-CIO's Metal Trades Department president Ron Ault said to the rally crowd. "Part of the deal is they're concerned about the cleanup costs at Avondale."
If HII sold to another shipbuilder (like Pyne), it may be selling to a potential competitor — whereas if it closes Avondale and consolidates with its other shipbuilding facility in Pascagoula, Miss. (as planned), it could receive a profitable gain from a Navy reimbursement. But to sell the yard, HII also would have to pay the Environmental Protection Agency for the cost of remediation and site cleanup. "There's no telling what that's going to cost," Ault said to the crowd, which then booed.
Other lingering problems for Avondale are Pentagon reports on safety flaws and workmanship issues with its Navy ships, including the U.S.S. New York, the publicized San Antonio class ship made with melted-down metals scrapped from the World Trade Center. Despite millions of dollars in state grant funding to modernize and renovate the shipyard, the Pentagon pointed to failed sea trials and a 2010 Congressional report stating many of the ships weren't capable of "combat survival."
Louisiana NAACP president Ernest Johnson called for state and federal involvement and pressure to keep the shipyard open.
"We need President (Barack) Obama," Johnson said. "We appreciate him creating jobs, but we need him to save these jobs. ... We need the United States federal government to investigate why these jobs are being terminated when this country needs jobs. We call upon President Obama to launch an investigation to save our jobs."
Tom Buffenbarger, president of the International Association of Machinists, said, "I know a fight when I see one, and we are in a fight. We are in a war. ... and we will win."
Richmond echoed Buffenbarger: "At the end of the day, this is a fight we're going to win."