Nunavut premier asks Ottawa for $250 million to tackle territory's housing crisis

The Canadian Press

Nunavut Premier, P.J. Akeeagok is shown in his office in Iqaluit, Wednesday, Jan. 17, 2024. THE CANADIAN PRESS/Dustin Patar

Nunavut's premier is asking Ottawa to provide $250 million to help the territory build more homes, which he says is key to addressing health-care issues caused by overcrowding. 

P. J. Akeeagok said in an interview in his office today housing is his government's top priority and a lack of housing has been an issue for decades across the North.

He says while he understands $250 million is a significant ask, Nunavut residents "deserve the same access" to housing as those elsewhere in Canada.

Prime Minister Justin Trudeau and Housing Minister Sean Fraser have spent the past several months travelling the country, announcing millions in spending for cities to get more homes built at a time when the Liberal government is under immense pressure to increase supply as a way to tackle housing affordability.

Akeeagok says it was "incredible" to see the amount of resources Ottawa has been providing to cities across Canada to tackle the current housing crisis, and the $250 million would be proportionate to what the federal government has spent elsewhere. 

Another issue facing Nunavut is the increased cost of living, which he says people are feeling from higher food and fuel costs, particularly as households have no alternative but to use diesel. 

Akeeagok says he would "absolutely" like to see Ottawa provide it with a carve-out when it comes to the levy on its fuel, as the government did in Atlantic Canada, given Nunavut's 25 communities have no access to alternative power. 

This report by The Canadian Press was first published Jan. 17, 2024

Tech industry expecting more layoffs, but say hiring coming too this year

Tara Deschamps, The Canadian Press

Marissa McNeelands, left, and April Hicke, founders of Toast, a women's tech collective, attend the Collision conference in Toronto on Wednesday, June 28 2023. THE CANADIAN PRESS/Chris Young

Tech’s biggest names spent last year in layoff mode and if the last few weeks are any indication, that pattern is continuing into this year.

Two weeks into January, major tech firms such as Google, Amazon, Discord, Instagram and Duolingo have already made job cuts and several other firms are rumoured to soon be following suit.

Even as industry members and observers expect the cuts to continue, they're optimistic that layoffs won't hit last year's levels.

"I don't think that this is going to be anywhere close to the layoffs of 2023," said April Hicke, co-founder of women's tech collective and talent organization Toast.

She views many of the job cuts carried out in January as companies streamlining their operations to make their businesses even more revenue-focused, especially as advances in artificial intelligence arise and companies get a better handle on how COVID-19 has shaped their futures.

The COVID-19 pandemic brought a boom in tech hiring as more people spent time at home on their devices and as capital remained easy to access while interest rates were low. 

But when lockdowns and other restrictions related to the health crisis began to lift, many tech companies realized their businesses would not continue to grow at the same levels as they had during the pandemic's onset. 

At the same time, investors became more tight-fisted with their funding and interest rates were aggressively hiked to offset inflation. They have yet to be lowered.

"A lot of tech companies are highly leveraged, so when interest rates are high, they get squeezed and they have to cut costs and sort of get lean," said Tu Nguyen, an economist with accounting and consultancy firm RSM Canada.

"They can't afford to just have a lot of people without generating the maximum amount of output and profitability, so with a high interest rate, they do have to cut staff."

That's exactly what Canadian companies such as Shopify Inc., Lightspeed Commerce Inc. and Hootsuite Inc. did last year, along with giants like Amazon, Google and Meta.

By the end of 2023, aggregator Layoffs.fyi had counted 262,582 workers globally laid off by 1,186 companies.

It has so far counted 7,528 employees laid off globally at 48 tech companies in January.

But "these layoffs of the large major tech companies are not all necessarily negative for Canadian companies," said Benjamin Bergen, president of the Council of Canadian Innovators, an innovation policy organization supporting startups in the country.

The cuts have been a good opportunity for Canadian firms to pick up talent that would be harder to lure away from larger multinational companies.

While big names like Google and Amazon have so far dominated layoff talk, smaller firms like Toronto-based artificial intelligence and biomedical startup BenchSci have reduced their head count too this year and news aggregation startup Artifact recently announced it's closing down. 

"The companies that I think that are most feeling the pinch are the ones that are scaling up but have not achieved cash-flow positive operations, and that's where I think maybe in the domestic Canadian market, you're going to see more of the layoffs," said Bergen.

Nguyen felt the cuts will trickle in until about the middle of the year, when central banks start easing interest rates and companies get the confidence to hire again.

A fall 2023 survey conducted by the Council of Canadian Innovators found many tech organizations expected to be hiring in 2024.

"And in some cases, they're double-digit head count increases," Bergen said.

That's in line with some of what Hicke is seeing.

"Companies that were a little more reluctant to hire through 2023 are starting to be a little more bullish," she said.

Some 84 per cent of Toast's clients engaged the organization in a talent search last year with the bulk of that work coming in the final two quarters. 

Data, AI and machine learning roles were popular among job postings, but marketing and sales professionals were in the mix too, Hicke said.

This report by The Canadian Press was first published Jan. 17, 2024.

Duelling U.S. sandwich brands Jimmy John's and Jersey Mike's to expand in Canada

Tara Deschamps, The Canadian Press

A Jimmy John’s sandwich chain location is shown in a handout photo. THE CANADIAN PRESS/HO-Jimmy John's

A battle of the sandwich brands is materializing as a pair of U.S. sub companies announce big plans for Canada.

Inspire Brands announced Wednesday that its Jimmy John’s banner would use a franchise model to make its way outside the U.S. this year with a restaurant in the Greater Toronto Area and more to follow across the country.

Meanwhile, Redberry Restaurants said its Jersey Mike’s Subs brand, which already has two locations in Ontario, plans to open more than 300 Canadian restaurants by 2034. Some will be franchises, others owned by Redberry, which owns and operates more than 180 Burger King and Taco Bell locations.

Both companies are known for their customizable submarine-style sandwiches, which are served with sides like chips and cookies. At Jimmy John's, diners can also opt for wraps or an unwich, a sandwich which uses lettuce in lieu of a bun.

They will join a number of homegrown and foreign sandwich companies with years of operating in Canada, creating a fight for dining out dollars. 

Joanne McNeish, an associate professor at Toronto Metropolitan University specializing in marketing, said the news is "exciting" for the Canadian market, but the big question is whether these brands have enough appeal in a new market.

"There's some assumption particularly about the Canadian market (from some American brands) that 'Oh, they're just like us, so they'll eat the same,'" said McNeish.

"First of all, our population is far more diverse than their population ... Second of all, these are restaurants that pride themselves on large portions. That's not actually a Canadian sensibility."

McNeish suspects these brands are interested in Canada because people turn to lower-priced goods and comfort food during economic downturns. COVID-19 has also placed an emphasis on healthy eating.

But there are a wealth of rivals already catering to both.

The closest rivals for Jimmy John's and Jersey Mike's will likely be Subway, also a U.S. chain, Toronto-born Mr. Sub, which is run by the Thai Express- and Manchu Wok-owning MTY Food Group, and Firehouse Subs and Tim Hortons, which share a parent company with Popeyes Louisiana Kitchen and Burger King.

Coffee giant Starbucks and U.K. café brand Pret A Manger, which has been expanding in Canada through A&W, are also players in Canada’s fast food sandwich market, though both focus on more artisanal ingredients.

McNeish feels Jimmy John's and Jersey Mike's will need to spend heavily to build the necessary brand awareness because their competitors "will not hesitate to fight back" with discounts, loyalty programs and coupons.

"These are not tiny brands that will run out of cash against these promotional efforts," she said.

"There will be price promotions and it could then cause consumers to default to the brands they're loyal to and they're aware of and it will not allow Jimmy John's and Jersey Mike's to get the traction."

Jimmy John's, which also announced an international franchise agreement for Latin America on Wednesday, has yet to share where its first location will be or how many stores it hopes to open.

"We won't publicly announce the number, but ... we're approaching 3,000 in the U.S. and we have amazing runway to grow, so you could easily do that and more in Canada over a long period of time," Michael Haley, president and managing director of international for Jimmy John's parent company Inspire Brands.

Inspire Brands, which is also behind Arby's, Baskin-Robbins, Buffalo Wild Wings, Dunkin' and Sonic, will use Canadian franchisor Foodtastic Inc. to launch Jimmy John's in Canada.

Foodtastic has more than 1,100 restaurants across brands including Milestones, Freshii and Quesada.

Asked about what the Canadian Jimmy John's menu will look like, Haley said, "You want to be able to go to a Jimmy John's in Canada and feel like you're at a Jimmy John's.

"But we also want to ensure that we make those changes that are needed to resonate with the Canadian consumer."

Jimmy John's research revealed more than 60 per cent of Canadian consumers prefer a hot sandwich, so the chain will offer the option to have a sandwich toasted. Jersey Mike's offers hot grilled sandwiches in addition to cold ones.

"There's just little tweaks. Sometimes even the name of the sandwich can be adjusted to resonate and just have a better translation," Haley said.

On whether Inspire Brands will bring some of its other companies, including burger and fries giant Sonic, to Canada, Haley said, "We do see that many or most of our brands can and could resonate in Canada."

"Stay tuned on Sonic. I think that will be our sixth brand to come outside the U.S. and we're not too far off working through today what the international adaptation of the brand could look like."

This report by The Canadian Press was first published Jan. 17, 2024.

 

Pushback against DEI 'unwise': experts

Jordan Fleguel, BNN Bloomberg

As diversity, equity, and inclusion (DEI) initiatives come under fire from prominent billionaires, experts caution that women and people of colour are still massively underrepresented in leadership roles.

DEI policies have become common at many Canadian and U.S. institutions such as businesses and universities, in an effort to bring more diversity to corporate leadership structures.

Pushback again the policies has escalated in recent weeks, following the resignation of Harvard University’s first Black woman president, with Elon Musk and Lululemon founder Chip Wilson publicly stating their opposition to the movement.

But despite years of effort to bring more diversity to the corporate world, there have only been small inroads made by women and people of colour, according to Darren Rosenblum, associate dean of graduate studies at McGill University’s faculty of law.

In an interview with BNNBloomberg.ca, they said DEI policies are still needed to bring about change.

“I think there's a lot of room for further diversification,” Rosenblum told BNNBloomberg.ca in a telephone interview.

“For people to take this moment as an opportunity to push against that is really unwise because expanding the pool of leadership is an essential component of good governance.”

Wes Hall, executive chairman and founder of Kingsdale Advisors, has for years advocated for increased diversity and representation in Canadian boardrooms.

In an interview with BNN Bloomberg, he said DEI has often been unfairly used as a scapegoat for other issues organizations face, distracting from the policies’ true goals.

“The problem that a lot of people seem to be having is when it comes to all the problems that we see in the world today, they put it in the DEI bucket, saying if we didn't have DEI, we wouldn't have all these problems,” Hall said.

“Then (they think) when somebody gets an opportunity, it's not because they're capable of doing that job, it's because of this DEI movement … but DEI is really just about representation. Representation in the boardroom, representation in C-Suite and representation in society.”

HARVARD CONTROVERSY

Discussions around whether DEI policies are fair or even legal have been ongoing for years, but the conversation returned to the forefront this month following Claudine Gay’s resignation as president of Harvard University.

Gay, the first Black woman to ever hold the position, resigned following allegations of plagiarism, but first drew criticism for not strongly condemning antisemitism on campus in the wake of numerous reported incidents of anti-Jewish hate amid the ongoing war between Israel and Hamas.

A Harvard subcommittee and independent panel that investigated the plagiarism allegations against Gay found “a few instances of inadequate citation” in her past academic writing. 

“It has become clear that it is in the best interests of Harvard for me to resign so that our community can navigate this moment of extraordinary challenge with a focus on the institution rather than any individual,” Gay wrote in an email to the Harvard Crimson earlier this month.

Prior to her resignation, billionaire investor and Harvard alumnus Bill Ackman was one of Gay’s most outspoken critics, leading calls on social media for her to step down.

Ackman has since turned his ire towards DEI policies, arguing in a social media post that Gay was not awarded her position by merit, but rather through efforts to diversify Harvard’s leadership, saying “she did not possess the leadership skills to serve as Harvard’s president.”

Fellow billionaires Elon Musk and Chip Wilson also chimed in on the broader issue, with Musk calling DEI “another word for racism.”

Wilson, the controversial founder of Canadian athleisure brand Lululemon, recently criticised his former company’s “whole diversity and inclusion thing,” in a Forbes profile.

“They’re trying to become like the Gap, everything to everybody,” he told the magazine. “I think the definition of a brand is that you’re not everything to everybody … you’ve got to be clear that you don’t want certain customers coming in.”

Wilson, who started Lululemon in 1998, stepped down from the company in 2013 and relinquished his board seat but remains a shareholder.

NEED FOR REPRESENTATION

Hall, who has worked with Ackman in the past, said he doesn’t see much merit in the current anti-DEI arguments, because he still sees a glaring lack of representation that needs to be intentionally addressed.

“If you go outside and it's a beautiful sunny day and somebody walks outside and says it's really gloomy and cloudy out, are you going to argue with that person? Probably not,” Hall said.

“But if it's somebody you respect saying that, you probably would be a little bit puzzled, maybe disappointed, because it's clear that the sky is blue, but I live the issue. I live it. I see the fact that there's representation that's lacking in certain circles.”

FEW PEOPLE OF COLOUR ON BOARDS: PROF

Rosenblum said that women used to be a rare sight in corporate boardrooms, but thanks to consistent and intentional efforts to include them, “we've seen the number of organizations with no women on their board plummet.”

But people of colour, and more specifically women of colour, are still massively underrepresented, they noted.

“The numbers are just nowhere near the level where there would be any justification for making a claim that there are people in leadership positions who are there solely because of their race,” they said.

Hall agreed with that sentiment, noting that “when people talk about DEI and they blame Black folks, for example, the numbers say otherwise.”

“The numbers suggest that Black and Indigenous (people) are at the very bottom of the totem pole in terms of people who are benefiting from DEI, but when it goes sideways, they're the ones that get the blame.”

Hall said that despite the recent pushback against DEI, he has meetings every day with people who are intentional about changing society for the better, with diversity in mind.

“There are a lot more people in this world who want to see good happen… than people who want to see the contrary,” he said.

 

Oil sector CEO compensation jumps double-digits amid surging profits: report

Rosa Saba, The Canadian Press

CEO pay in the oil and gas sector has soared with the industry's post-pandemic resurgence and will likely increase even more with the completion of the Trans Mountain pipeline expansion this year, a new report projects.

The report released Wednesday by the Bedford Consulting Group looked at C-Suite salaries, bonuses and other forms of executive compensation at 143 North American oil and gas companies — 68 of which were headquartered in Canada.

It found that in 2022, the most recent year for which data is available, executive pay in the sector rose sharply. 

That year, chief executives' total compensation ranged from a median $425,255 at companies with total assets under $100 million to $16.6 million at companies with total assets topping $30 billion.

Five of the seven company asset tiers laid out in the report saw median CEO compensation rise by at least 20 per cent in 2022 from the year before. 

In some cases, CEO compensation rose by as much as 75 per cent, the report found.

The increase in executive pay came as the oil and gas sector rebounded from years of downturn and low commodity prices. Russia's invasion of Ukraine in early 2022 led to global fears about energy security, causing oil prices to spike.

Bedford managing partner Frank Galati attributed the increase in executive pay in 2022 to the industry's "strong position," as energy demand rebounded alongside a slew of new export terminals on the Gulf of Mexico coast.

In Canada, surging oil prices led a number of energy firms to report all-time record profits in 2022. 

Some companies were also criticized by environmentalists and politicians for directing significant profits to shareholders in the form of dividends and buybacks, rather than prioritizing investments in decarbonization.

While executive compensation data for the 2023 year is not yet publicly available, Bedford Consulting Group is already projecting that CEO pay will tick higher in 2024. 

The Trans Mountain expansion project, which is 98 per cent complete, is expected to add over half a million barrels per day of Canadian oil export capacity.

Improved market access is expected to help narrow the Western Canada Select differential, the discount Canadian oil companies typically take on their product in part due to lack of export capacity.

Bedford said that as a result, it expects to see further increases in executive compensation in the Canadian oil and gas sector in the coming years.

This report by The Canadian Press was first published Jan. 17, 2024.

WestJet Encore pilots kick off conciliation, starting countdown to possible strike

The union representing pilots with WestJet's regional subsidiary have started the clock on potential job action — though any moves on that front are still at least three months off.

The Air Line Pilots Association, which represents more than 300 WestJet Encore aviators, says it has kicked off the conciliation process by filing for help with the federal mediation service.

The request leaves the labour minister 15 days to appoint a conciliation officer who will work with both sides toward an agreement — with possible picketing or strikes to follow if a deal fails to materialize after two months of talks.

Carin Kenny, who chairs the union's WestJet Encore group, says negotiations have come to a "near standstill" as the pilots demand better wages, working conditions and career progression.

In June, 1,800 pilots with WestJet and the now defunct subsidiary Swoop ratified an agreement that granted a 24 per cent pay bump over four years.

Bargaining came down to the wire, with WestJet cancelling more than 230 flights in preparation for job action before a deal was reached hours ahead of the strike deadline in May.

This report by The Canadian Press was first published Jan. 16, 2024.

Extreme weather a growing risk to Canada's electricity grid: experts

Amanda Stephenson, The Canadian Press

A series of electricity grid alerts in Alberta during the deep freeze last week made headlines across the country, but experts say power systems all across North America are increasingly at risk of being overloaded during severe weather.

Francis Bradley, CEO of the industry association Electricity Canada, said there is virtually nowhere the electricity grid isn't vulnerable to the rising severity and duration of climate change-related extreme weather.

“Over the last two years or so, during these extremes of weather, we’ve seen new peaks hit in terms of electricity demand," Bradley said in an interview.

"And it's not just in Alberta. We saw new peak demands hit last summer in Ontario, we saw new peak demand hit last winter in Quebec, for example. In most regions of the country, the extremes are increasing."

South of the border, electricity grids have suffered the strain in recent years. Winter storms led to blackouts in Texas in 2021 and blistering heat waves have forced California to declare repeated emergency grid alerts.

In Canada, Albertans were warned in an emergency alert issued by the provincial government last weekend to immediately reduce their power usage to avoid potential rotating blackouts as temperatures approached -40 C.

No blackouts were required, with the Alberta Electric System Operator noting electricity consumption dropped significantly within minutes of the alert being issued.

But the operator's data shows grid alerts in Alberta during both heat waves and cold snaps are increasing in frequency. The electric system operator issued just four provincial grid alerts in the four-year period between 2017 and 2020, but has issued an additional 17 since 2021.

Electricity grid reliability has become a political issue in Alberta, where the phaseout of dispatchable coal-fired power plants combined with a dramatic increase in intermittent wind and solar capacity has sparked debate about the practicality of a rapid transition to green energy.

But Bradley said Alberta's problems are not unique. All jurisdictions are facing rising demand for electricity, spurred in part by the increased demand for electric vehicles and other clean-energy innovations, and no single province has a perfect solution.

"Ontario, for example, has had concerns and has asked customers to reduce consumption during heat waves in the past," he said.

"Yes, I've heard concerns expressed about the energy mix in Alberta, but you'll also hear concerns about the energy mix if you happen to be in British Columbia or Manitoba right now because of drought. They're extremely dependent on hydro, and that's problematic in a low-water year."

A report released in November from the North American Electric Reliability Corporation (NERC) warned that much of North America this winter is at an elevated risk of having "insufficient energy supplies" to meet demand in extreme operating conditions, such as "prolonged, wide-area cold snaps."

While in general, U.S. jurisdictions are more vulnerable to potential winter grid interruptions because they are less prepared for cold weather, the report also flags parts of Canada as being vulnerable.

Saskatchewan, for example, is noted as being at "high" risk of electricity demand shortfalls this winter due to increased demand projections, the retirement of a natural-gas-fired power plant and planned generator maintenance.

Both Quebec and the Maritimes were noted to be at "elevated risk."

Mark Olson, NERC’s manager of reliability assessments, said Alberta wasn't even flagged as a potential area of risk by the report — a fact he said that demonstrates how difficult electricity demand forecasting has become as extreme weather intensifies. It is hard for electric system operators to predict or plan for climate events that are completely out of the range of normal.

"I know Alberta's system operator there is evaluating things, but there's early indication that the demand level was even higher than a normal peak winter demand event," Olson said. 

"It looks like it was more like a once-per-decade type of cold weather event."

Rob Thornton, president and CEO of the International District Energy Association, said grid alerts are worrisome for the public but added it's important to understand that the risk of a catastrophic grid failure remains exceptionally low.

"The grid in North America is really reliable, it really is. It's an amazing engine and machine," he said. 

Still, he said events like those experienced in Alberta last weekend show the importance of developing policies that will ensure a resilient and reliable electricity system to 2050 and beyond. This will include finding the proper balance between dispatchable and intermittent sources of electricity, investing in additional capacity to meet growing demand, building more inter-jurisdictional connections and more.

"These events (grid alerts) cause, I don't know if anxiety is the right word, but certainly awareness," Thornton said.

"Mother Nature is showing some fangs from time to time."

This report by The Canadian Press was first published Jan. 18, 2024.

 

ONE Continues Fleet Investments Ordering Its First Methanol-Fueled Ships

ONE Frontier is part of a current class of ships being delivered by Yangzijiang to Seaspan of ONE's operations (Yangzijiang)

PUBLISHED JAN 17, 2024 3:33 PM BY THE MARITIME EXECUTIVE

 

 

Ocean Network Express (ONE) is continuing to move forward with an aggressive fleet investment program announcing its next major order and this time it is for methanol dual-fueled containerships. The carrier, which was established seven years ago by three major Japanese shipping companies, mapped a strategy in 2022 that calls for an investment of $20 billion in its fleet and operations by 2030.

The new contract is being split between two Chinese shipyards, Jiangnan Shipyard and Yangzijiang Shipbuilding, which will jointly design the new class of vessels. Due to start delivery in 2027, the vessels will have a capacity of 13,000 TEU.

ONE is calling the vessels a significant milestone as its first fleet of methanol-dual fuel vessels and saying they will play a key role in reaching ONE’s sustainable goals as part of the Green Strategy. In addition to being methanol dual-fuel, the ships will include state-of-the-art technologies such as optimized hull form, waste heat recovery systems, and bow windshields. ONE said that selected vessels will also be equipped with an air lubrication system and shaft generator to help with exploring potential enhancements in fuel efficiency and the reduction of greenhouse gas (GHG) emissions.

 

Rendering of the newly ordered methanol dual-fuel containerships (ONE)

 

The order comes as Yangzijiang Group’s New Yangzi Shipbuilding is in the midst of delivering a class of seven 15,000 TEU vessels to be operated by ONE and owned by Seaspan. The fifth vessel, ONE Focus, was delivered at the end of last week as part of a contract that was placed in 2022.

In December, ONE took delivery on the last of six ultra-large boxships each with a capacity of over 24,000 TEU built in Japan. Using this class, ONE set new records in November and December for the highest TEU levels loaded on a single ship. The record now stands at 22,000 TEU with the loading of ONE Innovation in Singapore on December 14.

The company in March 2023 hedged its move toward alternative fuels ordering 10 ammonia/methanol-ready containerships to be delivered in 2025 and 2026, each with a capacity of 13,700 TEU. This followed a previous order for 10 conventual-fueled containerships to be built by Hyundai Heavy Industries and Nihon Shipyard.

ONE emphasizes that the new ships are being built to meet customer demand and part of its long-term strategy to evolve into a vessel owner. The designs they said are adaptable for future changes in the global market. ONE is currently the sixth largest carrier with a capacity of approximately 1.8 million TEU according to Alphaliner. The company CEO Jeremy Nixon in 2022 said the strategy would be to invest in 150,000 TEU of capacity annually although some of the additions are being built to replace older ships. He had predicted that ONE would deploy its first alternative fuel vessel by 2030.

 

U.S. Navy Plans Deep Review of Shipbuilding Delays

The future Constellation-class frigate (illustration courtesy Marinette Marine)

PUBLISHED JAN 15, 2024 2:50 PM BY THE MARITIME EXECUTIVE

 

Following news that a next-generation frigate will be delayed, the U.S. Navy has announced a top-level review of its shipbuilding programs. Workforce challenges have plagued many American manufacturers, and the Navy says that it is feeling the impact in its acquisition pipeline. 

“I remain concerned with the lingering effects of post-pandemic conditions on our shipbuilders and their suppliers that continue to affect our shipbuilding programs, particularly our Columbia Class Ballistic Missile Submarines and Constellation Class Frigate,” said Navy Secretary Carlos Del Toro in a statement Thursday. "We will continue to work with industry and all other stakeholders to strengthen our national shipbuilding capacity, both naval and commercial."

Two top acquisition officials, head of NAVSEA Vice Adm. Jim Downey and assistant secretary Nickolas Guertin, will head the review. 

The announcement followed shortly after USNI News reported delays in the Constellation-class frigate program. The first-in-class vessel will likely be delayed by at least a year because of understaffing at the contractor's Wisconsin shipyard, a source in Congress informed USNI. A Navy program manager confirmed that there are "challenges within the schedule." The setback would push back the frigate's handover to 2027, the final year of the "Davidson window" prediction of peak risk for a Taiwan Strait contingency. 

An in-depth review of the staffing issues at the Constellation-class shipbuilder's yard is already under way. The Navy has provided supplemental funding to incentivize staff to stay in Wisconsin and complete the project, according to USNI. 

Welders are in high demand in shipyards and industrial enterprises across the U.S., and skilled craftsman may have their pick of employers, including yards in larger cities and warmer climates.

 

USN Launches New Task Group for Uncrewed Operations in the Middle East

The new Task Group focuses on the deployment of the uncrewed vessels and integrating into crewed operations (USN)

PUBLISHED JAN 16, 2024 7:11 PM BY THE MARITIME EXECUTIVE

 

The US Navy reports as of the start of 2024 it has commissioned a new unit, Task Group 59.1, which focuses on the operational deployment of unmanned systems teamed with manned operators to bolster maritime security across the Middle East region. The group builds on the previous efforts developing uncrewed vessel operations in the Middle East and is designed to expand capabilities in an already very volatile area.

The group was officially commissioned in Bahrain as part of the U.S. Naval Forces Central Command’s Task Force 59. The task group, known as dubbed “The Pioneers,” will be under the command of Lt. Luis Echeverria, a surface warfare officer with over 60,000 unmanned operating hours at sea across 34 operations and exercises with Task Force 59.

“Task Group 59.1 is ready to take the capabilities of TF 59’s unmanned systems and charter new ground with manned and unmanned teaming concepts,” said Echeverria. “We are ‘the pioneers’ for the future of our Navy, and I couldn’t be more honored to lead this team.”

Established in September 2021, Task Force 59 is the Navy’s first Unmanned and Artificial Intelligence Task Force. It has tested, upgraded, evolved, and operated with more than 23 different unmanned systems according to NAVCENT. They did not specify which systems are being deployed with the group but noted that TF 59 integrates unmanned systems and artificial intelligence with maritime operations in the U.S. 5th Fleet area of operations to help ensure maritime security and stability in the Middle East region.

 

Devil Ray T-38 and Saildrone on earlier tests in the Gulf of Aquaba (USN)

 

“We are bringing budding, relevant technology to warfighters and doing it fast,” said Capt. Colin Corridan, Task Force 59 commodore. “Breaking the molds of the legacy acquisition model requires a level of connective tissue between industry partners and the end user operators, and 59.1 answers that bell. Our sailors will be there to ensure seamless integration of new tech introduced to operators while in the theater.”

U.S. Naval Forces Central Command/U.S. 5th Fleet’s area of operations encompasses about 2.5 million square miles of water area and includes the Arabian Gulf, Red Sea, Gulf of Oman, Gulf of Aden, Arabian Sea, and parts of the Indian Ocean. This area comprises 21 nations and includes three critical choke points at the Strait of Hormuz, the Suez Canal, and the Strait of Bab al Mandeb.

In recent months, Task Force 59 has conducted a series of unmanned exercises to advance lethality at sea. The exercises used live munitions fired from a T-38 Devil Ray unmanned surface vessel to strike a training target and they reported the munitions hit every time.

Forces from the U.S. 5th Fleet completed a four-day exercise in May 2023 that focused on unmanned systems and artificial intelligence integration into maritime operations. The prior month, the U.S. Navy sent the first unmanned surface vessel through the busy Strait of Hormuz, as part of its ongoing efforts to integrate drones into the fleet for a broad range of patrols and monitoring. The 41-foot vessel that looks like a speed boat was escorted by two U.S. Coast Guard cutters and according to reports was closely observed by the Iranians. The Iranians harassed and seized one uncrewed vessel used for monitoring, but the Navy defends its program saying it permits them to expand coverage and be seen at a lower cost of operations.

U.S. Navy Launches its First Purpose-Built Midsize USV

Courtesy NAVSEA

PUBLISHED JAN 17, 2024 12:51 AM BY THE MARITIME EXECUTIVE

 

Austal USA has launched the U.S. Navy's first purpose-built midsize unmanned vessel, Vanguard, Naval Sea Systems Command announced last week. 

Vanguard is the third in a series of USV testbeds based on a commercial crewboat design. Vanguard is the first built from the keel up for this purpose; the first two were converted from existing vessels. The hull was launched on December 13, but NAVSEA delayed the announcement until January 11. Outfitting is still under way under the guidance of Austal and defense contractor L3Harris. 

The program is an extension of the "Operation Overlord" experiment, a joint Pentagon-Navy development project, and the Navy refers to the vessels as "Overlord USVs," or OUSVs. According to program manager Capt. Scot Searles, Vanguard will have "new, built-in capabilities that our previous OUSVs did not possess." When the vessel is completed, it will make the trip to San Diego to join near-sister ships Ranger and Mariner, which have just returned from a five-month transpacific voyage. 

The results of that voyage are promising, Searles told defense media on Tuesday. In August, Ranger and Mariner deployed to the Western Pacific with Sea Hunter and Seahawk, a pair of smaller trimaran USVs. The four vessels sailed a combined 46,000 nautical miles, and stayed in autonomous mode almost all of the time. Human crews were on hand to intervene when needed, but this was infrequent, he told USNI. About once every two weeks, an intervention would be required for one of the ship's systems, whether mechanical systems, comms links or autonomy systems. 

The autonomy suite only had to be deactivated 13 times for all four vessels over that time period. “We’re having to actually have a human step in and correct the autonomy less than one time per month," Searles told USNI. 

For the future Large USV (LUSV) program, Congress has required the Navy to demonstrate that certain key mechanical systems can operate for 30 days without human intervention. This includes a 720-hour "no-touch" continuous run requirement for the diesel generator. The first land-based test for a popular commercial engine model was completed in December, and it "demonstrated sufficient mechanical reliability."

LUSV's mission is to serve as a magazine ship, essentially an extension of a destroyer's missile carrying capacity. It will be a 1,500-ton vessel, far smaller than a conventional surface combatant, saving cost while expanding the service's vertical launch cell count.