But he struggled to get the Navy to increase shipbuilding numbers, one of Trump’s top priorities. Phelan had also lost key staff in recent months. Hegseth in October fired Jon Harrison, Phelan’s unusually powerful chief of staff who had sought sweeping changes to the Navy’s policy and budgeting offices and attempted to curb the role of the undersecretary before undersecretary Hung Cao was confirmed to the post.
Cao, the service’s second ranking civilian, will take over Phelan’s role on an acting basis.
Phelan’s management of the Navy was “out of touch” with the service, which frustrated both Feinberg and Hegseth, according to the second person, who added that Phelan had been left with “low-level people” as advisers.
Hunter Stires, who served as a top Navy advisor in both the Biden and Trump administrations, said Phelan had also made a misstep when he signaled an openness to building American warships abroad.
“Phelan’s statements directly undercut a bipartisan strategy championed by the Trump administration to incentivize world class allied shipbuilders to invest in modernizing and expanding shipyards here in the United States,” he said.
The Pentagon announced Phelan’s surprise departure on Wednesday without citing a reason. “On behalf of the Secretary of War and Deputy Secretary of War, we are grateful to Secretary Phelan for his service to the Department and the United States Navy,” chief Pentagon spokesperson Sean Parnell said in a statement. “We wish him well in his future endeavors.”