California's Ocean Economy - California Resources Agency - State ...

NOEP
7.1 Ship & Boat Building and Repair: Description of the Sector
The shipbuilding and repair industry builds and repairs ships, barges and other large vessels,
whether self-propelled or towed by other craft. This industry also includes the conversion
and alteration of ships and a portion of the manufacture of offshore oil and gas drilling and
production platforms. The boat building and repair industry is engaged in the
manufacturing and repairing of smaller non-ocean going vessels primarily used for
recreation, fishing, and personal transport
Unlike most other industries, only a small number of orders for large ships are received each
year, and these often take years to fill. The orders for shipbuilding and repairs are primarily
placed by large shipping, passenger and cruise, ferry, petrochemical, commercial fishing, and
towing and tugboat companies, or the federal government. The principal federal
government agencies placing ship building and repair orders include the Naval Sea System
Command, the Military Sealift Command, the Army Corps of Engineers, the US Coast
Guard, the National Oceanic and Atmospheric Administration, the National Science
Foundation and the Maritime Administration. The boat building and repair industry is
almost entirely privately owned and is characterized by a very large number of buyers with
varied tastes and a larger number of producers with varied product ranges.
The US ship building and repair industry is primarily devoted to building ships for the US
Navy and a small number of commercial shipping companies. The industry reached its peak
output in the mid-1970s, when it held a significant portion of the international commercial
market while maintaining its ability to supply military orders. Since then, new ship
construction, the number of ship building and repair yards, and overall industry employment
have decreased sharply, particularly since the end of the major naval buildup of the 1980’s.
This decline came on top of a severe drop in the construction of new vessels, which fell
from about 77 ships (1,000 gross tons or more) per year in the mid-1970s to only about eight
ships through the late 1980s and 1990s. Smaller shipyards have been able to keep much of
their mainly commercial market share, since these shipyards build vessels used on the inland
and coastal waterways, which, by law, must be built in the US.
7.2 Ship & Boat Building in California
California was a major ship builder during World War II, when the Richmond and other
shipyards were flourishing. 41 The ship building industry in California is heavily dependent on
the federal government as its primary market. The Navy’s new ship procurement has
declined since the accelerated Navy ship construction in the 1980s. First tier shipyards may
face the possibility of closure. The General Dynamics National Steel and Shipbuilding Co.
(NASSCO) in San Diego CA is the biggest private shipyard on the West coast and employed
more than 3000 people in 2000. Over the last four decades, NASSCO has delivered over
100 ships to the world's fleets -- 53 ships to commercial customers, becoming America's
leading commercial shipbuilder during that period; and 53 auxiliary and support ships for the
US Navy. These have included oil tankers, ferries, containerships, and oceanographic
41 Comments by G. Pontecorvo for review of this document.
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