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U.S. MERCHANT SHIPBUILDING M. Lee Rice Major Merchant Vessels, 2,000 DWT and Over, Delivered by U.S. Shipyards During 1984 Name of Ship Type Owner GT DWT HP Exxon Baytown* Exxon Wilmington AVONDALE SHIPYARDS Tanker Exxon Shipping Company Products Exxon Shipping Company SHIPYARD Owner Ship Type of Ships Hull Nos. Total DWT Total HP Est. Del'y BAY SHIPBUILDING Sea-Land Service Cont. 3 735-7 48.000 D-NA 86-7 GENERAL DYNAMICS-QUINCY General Dynamics MPS 4* 87-90 90,800 D-105-600 85-6 TACOMA BOATBUILDING At-Sea Incineration Incin. 1 434 7.317 D-2,250 85 TWIN CITY SHIPYARD Gulf Coast Trailing Dredge 1 885 4,800 D-6,800 85 TAMPA SHIPYARDS Ocean Products Carriers Tanker TOTALS 5* 14 1121-5 150,000 300,917 D-76,500 191,150 85-6 *For charter to the Military Sealift Command US SHIPBUILDING OUTLOOK Markets & Cost Saving By M. Lee Rice, President, Shipbuilders Council of America Editor's note: The following re- port is reprinted from the 1984 Annual Report of the Shipbuild- ers Council of America that was released in April, 1985. 32,136 57,720 D-16,800 27,508 48,011 D-16,800 For the shipbuilding and ship- repair industries, 1984 was a year in which "holding ground" was a pri- mary operative phrase. The present policy of the Administration is that our industry must fend for itself as best it can, and survive as best it can despite the projected deficiencies in our ability to meet military require- ments. Indeed, even steps that could have been taken without direct cost to the government and which would have been supportive of the ship- building industry were not imple- mented. Among these are withdraw- al of the proposed rule that would allow the repayment of construction differential subsidy (CDS) by oper- ators to qualify affected vessels for Jones Act trading privileges. The threat of rule promulgation contin- ues to disrupt the Jones Act market for operators and thwarts shipbuild- ing potential. A tolling of the litany of failures in policy planning and the execution of maritime policy does not need to be repeated. My message in the 1983 Shipbuilders Council Annual Re- port can be redated, as current, without fear that important gains have been neglected. It is, of course, a fact that the Congress enacted the Shipping Act of 1984 following seven long years of Congressional debate. That Act, which is intended to give regulatory relief and broadened operating flex- ibility to the liner industry, when signed by the President was hailed as the new beginning of a healthy merchant marine. It is also true that two major contracts for Jones (continued on page 46) BATH IRON WORKS Falcon Champion Tanker Falcon II Sea Transport 28,200 33,500 D-12,200 BAY SHIPBUILDING Thoroughbred Topper* Tug/barge Norfolk Southern 20,500 33,500 D- 7,200 TACOMA BOATBUILDING Apollo One* Incinerator At-Sea Incineration 2,073 7,317 D- 2,250 * Selected by MR/En as an "Outstanding Oceangoing Ship" of 1984 (12/1/84 issue). Major Merchant Type Vessels, 2,000 DWT and Over, Under Construction or on Order in Shipyards of the United States as of May 1, 1985 No. Secretary Dole Promulgates CDS Repayment Rule Subsequent to Mr. Rice's writing of this article, just as we went to press with this issue, Sec- retary of Transportation Eliza- beth Dole promulgated a rule permitting the owners of U.S.- flag tankers built with the assist- ance of construction differential subsidy (CDS) for the foreign trades to repay to the govern- ment the subsidy on the vessels, thus allowing these tankers to op- erate in the domestic trades. The Department of Transpor- tation, in a press release, stated that the CDS repayment rule will "introduce newer, more efficient tankers" into the Alaskan North Slope crude oil trade, increase competition, and "minimize gov- ernment obstacles to market- place decisions." DoT analysis predicts that seven VLCCs will take advantage of the one-year window, and the CDS repayment on these ships could provide the treasury with $277 million in- cluding interest. The refunding rule is sched- uled to take effect June 6 this year. Accompanying documents are devoid of any in-depth analy- sis of the rule's effect on national security or the shipbuilding in- dustry. This action by Secretary Dole was not unexpected; pro- tracted litigation should follow. 44 Maritime Reporter/Engineering News