Articles
Davie's $1B shipbuilding investment the latest in Hou’s blue-chip OEM parade
By Bart Taylor, GHMA
Houston has become America’s marquee manufacturing destination and in September, the parade of blue-chip OEM announcements continues.
Eli Lilly confirmed this week that it will build a new production facility in Houston – a $6.5 billion manufacturing plant to be located in Generation Park. It’s a major win – and an even larger investment than previously speculated. As Lilly notes on its site, “The new Houston site, Lilly's eighth U.S. manufacturing facility announced since 2020, will focus on domestic production of small molecule synthetic medicines.”
Lilly also said it would hire 615 full-time employees, including scientists, engineers, operations personnel and lab technicians – and an additional 4,000 construction jobs.
Even more significant, from my perspective, is the announcement from global shipbuilding icon Davie of detailed plans for a “$1 billion overhaul of the historic Gulf Copper shipyard in Galveston, Texas, aiming to create the “American Icebreaker Factory”—a purpose-built facility for constructing U.S. Coast Guard’s Arctic Security Cutters.”
Mike Schuler with the maritime resource gCaptain noted that “The facility will draw on the expertise of Finland’s Helsinki Shipyard—Davie Defense’s sister company and the builder of complex polar icebreakers in Finland over the past 25 years.”
Schuler quoted Kai Skvarla, CEO of Davie Defense, that the company “will achieve this by working closely with our Finnish colleagues on a proven, fourth-generation Arctic Security Cutter design and by creating a purpose-built facility in Texas. We’ll recruit and train a Texas workforce, buy from American suppliers, and deliver mission-ready ships on time and on budget.”
Skvarla said that “Davie Defense anticipates supporting over 2,000 direct jobs at Gulf Copper and more than 7,000 statewide,” with a total projected economic impact exceeding $9 billion (according to an independent study by Impact Data Source).
Why so significant? It’s long been a hope that a new and modern shipbuilding capacity would be developed in south Texas, an ambition echoed by James Davies, President and CEO of Davie: “We share a vision with Gulf Copper to make Texas a world-class hub for American icebreaker and complex ship production. Texas is ready to lead a new Golden Age of American shipbuilding.”
More, a new shipbuilding ecosystem is an ideal match for what Houston manufacturing does really well. The industrial supply chain here of fabricators, welders, finishers, assemblers and other suppliers is world class and easily America’s most capable. It’s served the energy sector so well over decades and generations, and is poised for new opportunities. Shipbuilding – in addition to the growing aerospace and automotive supply chain in south Texas – would top that list.
We'll have more on the Davies expansion and the development of the Greater Houston shipbuilding ecosystem next time.
Bart Taylor is executive director of the Greater Houston Manufacturing Association and founder of Inside MFG. Reach him at [email protected].
