PANAMA CITY, Fla. (WMBB) — The federal government has dealt a huge blow to Eastern Shipbuilding Group, awarding the contract for the next 11 Coast Guard cutters to another company.
The contract was more than $3 billion.
Eastern Shipbuilding leaders felt good about their chances of winning the contract for the second phase of the Coast Guard’s Offshore Patrol Cutter Program.
Eastern won the contracts for the first four cutters and seemed to be the front-runner to build the next 11 ships.
However, on Thursday, the Coast Guard announced it is going with another bidder, Austal USA out of Mobile, Ala.
Eastern’s president Joey D’Isernia issued a statement, saying company officials are disappointed and are evaluating their options.
U.S. Senator Marco Rubio (R) also issued a statement, blasting the Coast Guard’s decision and calling it “short-sighted.”
He went on to say Eastern was the proven company, and changing builders will cost the taxpayers money.
The Coast Guard awarded Eastern a contract in 2016 for the construction of up to 11 of the new offshore patrol cutters.
The new 370-foot vessels will replace the Coast Guard’s current fleet, which consists of smaller, 270-foot cutters. Each takes three years to build.
When Hurricane Michael hit two years later, the Coast Guard extended some of Eastern’s original deadlines, but reduced the number of ships from 11 to four. They put out a new bid for the next 11 cutters.
Last year, Sen. Rubio visited Eastern to see how the first cutter was progressing. At that time, he expressed his support for Eastern getting the contract for phase two.
“There’s no place in the country that can do this,” Sen. Rubio said. “The jobs it’s creating, what it means to this community, what it means to this part of Florida is incredible, so I think you know now as their bidding, as they’re involved in a competition with a bunch of other companies for the next phase of this project, there’s no place in the country that can argue that they have their own stand-alone facility dedicated to doing this, and they can prove they’ve done it.”
Earlier this year, D’Isernia said all of the nation’s biggest shipbuilders were bidding.
“This is a really great milestone for Eastern Shipbuilding and our community, because this truly has been a community effort to get to where we are, especially since Hurricane Michael,” he said. “We are very proud of it.”
Despite their disappointment, Eastern workers are still completing the first three cutters. Construction on the fourth vessel will begin this fall.
The Coast Guard’s original plan was to build a total of 25 cutters. If that’s the case, then Eastern management may decide to bid on the contract to build the last 10 ships.
However, as D’Isernia said, they’re evaluating their options.
Eastern Shipbuilding was reportedly interested in acquiring some of the paper mill property, next to the company’s Sherman shipyard. At this point, it’s unknown if management is still interested in that option.