Austal USA Appoints its Fourth President in Five Years

Naval shipbuilder Austal USA announced Thursday that president Michelle Kruger has stepped down from running day-to-day operations and assumed an advisory role, to be followed by retirement in June. The company's COO has taken over management as interim president, effective immediately.

"Austal USA is deeply grateful for Michelle Kruger’s vision, commitment, and the lasting impact that she has made on our organization as company president over the last two years," the firm said in a statement. "Congratulations on this momentous milestone and best of luck with the adventures ahead of you as you enjoy your retirement."

Austal is a key partner in multiple Navy shipbuilding initiatives, from the aluminum-hulled LCS and EPF to steel-hull auxiliaries like the T-AGOS program to modules for other defense primes; the company has a wide and deep portfolio, and has been growing rapidly.

Kruger, a USMMA grad and marine engineer by background, worked on LCS sustainment at NASSCO and then transferred over to Austal in 2022, taking a role running Austal's service business, then president in 2023. During her tenure, she oversaw the launch of a major facility expansion for construction of midsize government vessels and submarine modules for the Virginia- and Columbia-class programs. The infrastructure program, upon completion, will give Austal a total of one million square feet of space in seven assembly bays.

Kruger will now serve in an emeritus capacity until June, when she will retire. Her transition was announced one week after Austal Ltd. had to cut profit guidance by 18 percent because of an accounting error at the Austal USA unit. Austal USA's offices had reportedly double-counted incentive payments on its T-ATS fleet tug contract for the U.S. Navy; when the error was found, Austal had to reduce its revenue projections accordingly. Its stock has fallen by 23 percent in the past month.

Austal USA's COO, Gene Miller, has taken over from Kruger as interim president. He is the fourth Austal USA executive to assume the top role in five years, and the third to begin work after a predecessor's sudden departure.

Kruger became interim president in August 2023 after the resignation of Rusty Murdaugh, who departed after Austal lost money on the same fleet tug (T-ATS) contract, its first experience with steel shipbuilding. Losses on the tug order prompted Austal Ltd. to temporarily halt stock trading and make a cut in earnings projections, followed shortly after by Murdaugh's exit.

Murdaugh had started as interim president in 2021 after the ouster of former president Craig Perciavalle, who was later indicted on charges of accounting fraud related to alleged misreporting of construction costs on the LCS program in 2013-16. In 2024, Austal USA pleaded guilty to one count of securities fraud and one count of obstruction of a federal audit in connection with these events; it appointed an independent monitor, paid a $24 million fine and paid $24 million in investor restitution to settle the criminal charges. Court proceedings continue for Perciavalle and two other suspects.