RADM Buzby began by noting that things are beginning to change in a big way in the sealift world. Big decisions from both sides of that Sealift equation--the organic government fleet and the commercial fleet--remain ahead. On the commercial side, the 60-ship Maritime Security Program (MSP) provides us with reliable access to militarily useful US-flag tonnage, as well as the global logistics and distribution networks that they operate in day to day. He estimated that if the government had to own and operate these ships, the budget to do so would be close to $60 billion--something the US could not afford.
Buzby continued by stating that just as important as those ships and those networks, are the highly skilled mariners and crew the ships provide as a source to man, not only the MSP fleet, but government ships as well. The MSP is authorized by Congress out to 2025. That is not that far off so MARAD is working with industry now to lay out what that next generation of MSP should look like in terms of capacity, capability, ship type, and participation. Currently the ships are all dry cargo with two tankers. However, there's a potential need for other types of ships with differing capabilities.
We also need to acknowledge that the cost differential is only getting larger between US and foreign-flag ships, he said. Adding that according to a recent study, operating costs now average around $6.7 million per year. Work to look at the new MSP has begun with participation from MARAD's industry partners, USTRANS-COM and the Navy--and they are committed to getting it right.
Buzby then acknowledged that a nearer term cliff was quickly approaching in 2022, when the current $5 million a year MSP stipend slips back to $3.7 million--a fact that clearly has to be addressed. This is definitely on MARAD's scope and something currently being worked on. "We also need to be looking at the role that cargo preference plays going forward, along with MSP, to ensure that we have a viable peace time fleet that will be there if we call them in time of crisis," he said. "You know, we've heard it loud and clear from industry that cargo, not just stipends, are necessary to make this thing work."
The government's Sealift fleet is not getting any younger, with an average age of 43 years. The cost of maintaining this "antique" fleet is sky-rocketing and it must be re-capitalized soon. Buzby told the audience that he had recently made the difficult decision to take a ship, one...