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  • Writer's pictureASSA Staff

RESPONSE TO DEPUTY'S MANAGEMENT ACTION GROUP (DMAG)

September 12, 2023


The Honorable Jack Reed The Honorable Roger Wicker

Chairman, Committee on Armed Services Ranking Member, Committee on Armed

United States Senate Services

Russell Senate Office Building Room 228 United States Senate

Washington, DC 20510-6050 Russell Senate Office Building Room 228

Washington, DC 20510-6050


The Honorable Mike Rogers The Honorable Adam Smith

Chairman, Committee on Armed Services Ranking Member, Committee on Armed

House of Representatives Services

Rayburn House Office Building, Room 2216 House of Representatives

Washington, DC 20515 Rayburn House Office Building, Room 2216

Washington, DC 20515


Dear Chairmen and Ranking Members:


I am writing to you as the Chairman of the American Shipbuilding Suppliers Association (ASSA), a not-for-profit association formed in 2011 to advocate for the United States shipbuilding supplier industrial base. Along with the corporate members of ASSA, I am deeply concerned with the steady decline we have seen in the domestic shipbuilding supply chain over the past 20 years and our increasing dependence upon allies and foreign partners for critical ship components and systems.

ASSA strongly encourages the conferees on the Fiscal Year 2024 National Defense Authorization Act to adopt the Senate-passed provision regarding the increased use of the domestic shipbuilding supplier industrial base. Below are the many reasons why we believe this action is critical.


DOD’s “Fiscal Year 2019 Industrial Capabilities Report” (May 2019) stated: “Industries involved in the manufacturing of shipbuilding components were among the hardest hit by the global shift in the industrial base over the past 20 years. Since 2000, these industries experienced a combined decline of over 20,000 establishments in the United States.”

While this decline has continued unabated for years, our allies and foreign partners were expanding their reach into the US shipbuilding industry while maintaining restrictive policies for US participation in their national shipbuilding programs, often with significant offset requirements for participation.


Unlike the position recently espoused in a letter to your offices from the Defense MOU Attachés Group (DMAG), our corporate members, representing thousands of tax paying skilled workers and voters, are encouraged by the efforts of the Senate Armed Services Committee and the full Senate to rectify the shipbuilding supplier industrial base issue by passing legislation that would not only stop the erosion of domestic capability, but encourage new investment and growth in this critical market segment.

It is imperative that US Government shipbuilding programs maximize the use of a robust domestic supplier industrial base to ensure our ability to build and sustain the modern Navy necessary to meet and defeat potential threats.

ASSA recognizes the importance of global agreements and alliances, but it remains incumbent upon the US Government to “provide for the common defense,” which includes providing the capability to fully support domestic shipbuilding programs without over-reliance on foreign suppliers. Unlike the members of the DMAG, ASSA is grateful for your continued focus on strengthening first and foremost the fragile domestic shipbuilding supply chain through continued legislative proposals to increase domestic content requirements for current and future US Government shipbuilding programs.


ASSA understands the proposed legislation under consideration is focused exclusively on shipbuilding programs and does not address increasing domestic content across all Department of Defense programs, as intimated by the DMAG letter. Shipbuilding is a unique and demanding profession that requires broad industrial base support from potentially thousands of small to large companies, many of whom provide products dedicated to supporting US Government shipbuilding programs. Recent surveys have shown that far too many shipboard components have a limited number of domestic sources as a result of the greatly diminished domestic commercial shipbuilding in the US and of the increased procurement from often subsidized foreign suppliers. A refocus on stabilizing and strengthening the domestic shipbuilding supply chain will stimulate domestic investment in this market, increase competition for these critical components and systems, eliminate international supply chain interruptions that have been too commonly experienced in the last three years, and eventually reduce the cost and lead time of building the complex ships required to meet current and future global threats. Additionally, the added tax revenue that can be realized by manufacturing these shipboard systems and components in the United States will be substantial.


In addition to the financial benefits of growing the domestic shipbuilding supplier industrial base, the ability to demand full accountability of lower-level sources of supply significantly improves the security of these systems and components and provides additional protections against counterfeit and unauthorized parts. The national security benefits of the expansion of this critical supply chain are significant and the additional protections provided by the increased use of domestic suppliers enhances the ability of the US Navy and US Coast Guard to operate without the threat of increased cyber vulnerability. As always, ASSA appreciates the dedication of the Members of the Armed Services Committees to ensure that our Nation can truly provide for the common defense of its citizens.

Very Respectfully,


Chris Cikanovich, Chairman

Copy to: All Members of Senate and House Armed Services Committees


ASSA Letter in Response to DMAG Letter
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