Bath Iron Works President Dirk Lesko, a 30-year veteran of the Bath-based shipbuilder, abruptly resigned Thursday.

A two-sentence company memo sent to employees said Lesko’s resignation was effective immediately, and that he was being replaced temporarily by another executive until a permanent successor is found.

“Dirk Lesko has resigned as president of Bath Iron Works. Robert E. Smith, General Dynamics executive vice president for Marine Systems, has assumed direct responsibility for Bath Iron Works pending appointment of a permanent replacement,” the company said in a statement sent early Friday to the Press Herald.

BIW, owned by Virginia-based defense contractor General Dynamics, did not explain the reason for Lesko’s sudden departure and declined to comment further.

One analyst speculated that Lesko’s departure may have come as a surprise to BIW leadership and could have been prompted by a disagreement with General Dynamics over a recent commitment to boost BIW workers’ pay.

Tim Suitter, spokesman for the shipbuilders’ union IAMAW Local S6, also declined to comment about Lesko’s resignation or his tenure at the shipyard. The union represents roughly 4,300 BIW workers.

The shipbuilder didn’t offer any further details about the leadership change. Lesko became president of BIW, which builds warships for the U.S. Navy, in 2016.

BIW is one of Maine’s largest employers, with nearly 7,000 workers at its Bath shipyard and production facilities in Brunswick.

In 2020, Lesko helped the company navigate a contentious strike that stretched through the summer and took more than two months to resolve. It was the first strike at BIW since a 55-day walkout in 2000.

Lesko’s resignation was made public on the same day that union leadership announced a memorandum of agreement concerning “historic” midterm wage adjustments.

“To reach a midterm wage adjustment of this magnitude is something that all parties should be proud of,” IAMAW Local S6 wrote in a letter to members. “We are at a critical juncture with BIW. We need to prove we are the best shipbuilders in the world by delivering ships on time and on budget. That will greatly improve our negotiations strength headed into contract negotiations in August 2023.”

‘CAUGHT FLAT-FOOTED’

Naval analyst Craig Hooper said Lesko’s abrupt departure was a surprise not only to him, but likely to BIW as well.

“At the corporate level, General Dynamics appears to have been caught flat-footed,” said Hooper, CEO of Themistocles Advisory Group, a Maryland-based national security advisory firm.

During previous leadership changes, General Dynamics officials have either announced a lengthy transition period or paired the announcement with news of an immediate long-term successor, he said. In this case, there was neither.

Hooper said it seems that the situation around Lesko’s departure may have evolved quickly.

Overall, Lesko’s tenure was a boon to the shipyard, Hooper said. He had stabilized things, weathered some tough labor relations, and the shipyard was performing well.

“That suggests Lesko’s abrupt retirement was a result of broader fiscal pressures within the wider General Dynamics corporation,” Hooper said. “Efforts to control inflation can have real consequences.”

Given recent statements from the union, there may have been some “disconnect” over labor costs between shipyard managers and the corporate office, he suggested.

“No executive wants to get in the middle of that, and, seeing the writing on the wall, Lesko may have jumped ship before he could be formally pushed,” Hooper said.

Loren Thompson, an industry analyst and CEO of The Lexington Institute in Arlington, Virginia, told NewsCenter Maine that Lesko’s resignation “had nothing to do with performance or personal behavior.”

“Dirk violated corporate policy, a specific rule, and that was deemed sufficient for a parting of the ways,” Thompson said, citing unnamed industry sources. He declined to comment further.

CHANGES UNDER LESKO

The shipyard experienced myriad changes during Lesko’s tenure.

It was during his time that BIW positioned itself as the sole producer of advanced Zumwalt-class destroyers. Bath Iron Works had initially planned to construct 32 of the vessels, the largest destroyers ever built and featuring a unique hull shape and design to reduce their footprint on radar.

Cost overruns and changes to the geopolitical theater gradually resulted in the number of ships being reduced to three, as the Navy restarted its Arleigh Burke-class program with more technological upgrades.

The last of the Zumwalt class ships, the future USS Lyndon B. Johnson, left the shipyard in January. The Zumwalt program cost the Navy $23 billion in research, design and construction.

In recent years, Lesko focused on getting the shipyard caught up on its production schedule, as well as a push to hire and train an additional 2,000 workers, The Associated Press reported. At one point, the shipyard was six months to a year behind schedule on delivering ships to the Navy.

Lesko’s departure is not the only leadership change for BIW in recent weeks. On March 25, U.S. Naval Capt. David Hart was installed as Navy supervisor of shipbuilding. He replaced Capt. Joseph Tuite, who retired after 30 years at the shipyard.

Currently under construction are the Arleigh Burke-class destroyers Patrick Gallagher, Carl M. Levin, John Basilone, Harvey C. Barnum Jr., Louis H. Wilson Jr., William Charette and Quentin Walsh.

It was also during Lesko’s time at BIW that the shipyard secured a $45 million tax break from the state.

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