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Navy Awards Contracts for New Ship Components

The building of a modern warship requires not only the initial large contract with the builder but numerous other ones to buy components and support for the actual ships. Other systems are purchased with separate contracts and then items are provided to the builder for installation on the ships as they are assembled. The U.S. Navy is currently building new aircraft carriers, missile destroyers, Littoral Combats Ships (LCS), amphibious warfare ships as well as support vessels.

The LCS is being built by 2 different yards under 2 separate contracts. The LCS-1 design are made in Wisconsin by Marinette Marine and Lockheed Martin (LMT). The LCS-2 in Mobile, AL by Austal America and General Dynamics (GD). While they have dissimilar hull designs the basic weapon fit remains the same and both will carry mission modules. Up to 20 LCS are on contract to be built with the Navy periodically issuing contracts for 2 from each builder.

2 related contracts were recently awarded to support U.S. Navy ship construction. First General Dynamics (GD) received one for 8 MK 46 Naval Weapon Systems. The MK 46 is a 30mm cannon mounted in a stabilized turret. These will be installed on LPD-12 amphibious assault ships and the LCS. The contract is worth $26 million and is a follow on to previous contracts under which 30 systems have been delivered.

Then ATK (ATK), the ammunition and explosive manufacturer, received a contract for 30mm ammo. This $12 million contract is for incendiary rounds for the MK 46. It is a 5 year Indefinite Delivery / Indefinite Quantity (ID/IQ) contract with 1 base and 4 option years. As an ID/IQ the Navy will order off of the contract what is required to outfit ships with the Mk 46 weapon.

With Sequestration and the budget reductions recently passed by Congress and agreed to by the Obama Administration FY13 will probably not see many more major contracts awarded. There may be many though like these to support bigger programs already underway.

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Nation’s Seventh Littoral Combat Ship Takes Shape as Lockheed Martin Team Lays The Keel — Press Release

The keel laying ceremony for LCS 7, the future USS Detroit, took place at Marinette Marine Corporation’s shipyard on Nov. 8, 2012. Pictured from left to right: U.S. Navy Commander Nate Schneider, LCS Program Manager’s Representative, Supervisor of Shipbuilding Bath, Detachment Marinette; Joe North, Lockheed Martin Vice President of Littoral Ship Systems; Sen. Carl Levin (D-Mich.), Mrs. Barbara Levin, ship sponsor; Chuck Goddard, President & CEO Marinette Marine Corporation, U.S. Navy Rear Admiral James Murdoch, Program Executive Officer, Littoral Combat Ships; Monsignor James Dillenburg, Keel Laying Chaplain. (PRNewsFoto/Lockheed Martin)

MARINETTE, Wis., Nov. 8, 2012 /PRNewswire/ — A Lockheed Martin (NYSE: LMT)-led industry team officially laid the keel for the U.S. Navy’s seventh Littoral Combat Ship (LCS), the future USS Detroit. The event was part of a time-honored keel laying ceremony that took place at the Marinette Marine Corporation shipyard in Wisconsin.

The Lockheed Martin LCS team is building the futuristic Freedom-variant LCS for the U.S. naval fleet. With the first two ships delivered, two additional ships in production and two more in early material procurement, the industry team is addressing the Navy’s need for an affordable, highly-networked and modular ship unlike any other in the world. This new class of combatants is designed to support a wide variety of missions including anti-submarine, surface and mine countermeasure warfare, shipping lane protection, and humanitarian aid.

“It’s an honor to participate in this event for the future USS Detroit,” said Sen. Carl Levin, D-Mich. “The keel laying ceremony marks a great milestone for the program and the naval fleet. These ships are vital to our national defense strategy and their production contributes significantly to the Wisconsin and Michigan economies.”

During the ceremony ship sponsor Barbara Levin authenticated the keel by having her initials welded into a sheet of the ship’s steel. She was assisted by the Navy’s Program Executive Officer – Littoral Combat Ships Rear Admiral James Murdoch.

“This ceremony marks the beginning of my commitment to supporting the future USS Detroit and the brave crews that will serve aboard her to defend our country,” said Barbara Levin. “It is a very moving moment for me, as I am very proud to serve as the sponsor of this powerful ship which honors my native city.”

The Lockheed Martin-led LCS team includes ship builder Marinette Marine Corporation, a Fincantieri company, naval architect Gibbs & Cox, as well as hundreds of domestic and international suppliers, including approximately 30 small businesses in Wisconsin and Michigan.

“Marinette Marine Corporation’s shipbuilding expertise, coupled with Lockheed Martin’s integrated and automated systems that bring the capability to fight, operate and support the ship, make the Freedom-variant LCS a powerful vessel,” said Joe North, vice president of Littoral Ship Systems for Lockheed Martin’s Mission Systems & Sensors business. “The LCS team continues to invest in shipyard improvements and has applied best practices to ensure we continue to be more efficient and more innovative with each new ship we build.”

By 2013, industry investment will total approximately $94 million, which includes nearly $70 million to date from Marinette Marine Corporation’s Italian parent Fincantieri-Cantieri Navali Italiani for shipyard improvements.

Lay the keel is a shipbuilding term that marks the beginning of the module erection process, which is a significant undertaking that signifies the ship coming to life. Modern warships are now largely built in a series of pre-fabricated, complete hull sections rather than a single keel, so the actual start of the shipbuilding process is now considered to be when the first module for the ship is erected in place and is often marked with a ceremonial event.

About Lockheed Martin

Headquartered in Bethesda, Md., Lockheed Martin is a global security and aerospace company that employs about 120,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. The corporation’s net sales for 2011 were $46.5 billion.

About Fincantieri

Fincantieri is one of the world’s largest shipbuilding groups, which in over 200 years of maritime history has built more than 7,000 vessels. It is world leader in cruise ship construction and a reference player in other sectors, from naval vessels to cruise ferries, from megayachts to special high value-added vessels, and ship repairs and conversions. Headquartered in Trieste, the Group has over 10,000 employees and eight shipyards in Italy alone. Fincantieri operates in the United States through its subsidiary Fincantieri Marine Group (FMG). This company, which serves both civilian and government customers, including the U.S. Navy and Coast Guard, has three shipyards (Marinette Marine, Bay Shipbuilding, Ace Marine), all located in the Great Lakes region. Since 2002 Fincantieri has built or has orders to build more than 100 ships, worth a total of € 22 billion, and has developed numerous prototypes in each of its business segments.

For additional information about Lockheed Martin, visit: http://www.lockheedmartin.com/ms2/ and http://www.lmlcsteam.com

SOURCE Lockheed Martin

Photo courtesy of PR Newswire

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Two More Littoral Combat Ships for Lockheed and Marinette Marine

The U.S. Navy in late 2010 awarded contracts to the two teams building the new Littoral Combat Ships (LCS) for ten platforms each. These were Lockheed Martin (LMT) whose mono-hull design will be built at the Marinette Marine yard in Wisconsin and Austal America in Mobile, AL. Austal America is the U.S. subsidy of Austal (ASB) the Australian manufacturer of fast ferries. The Austal design utilizes a catamaran hull.

Prior to these contracts each team was building two of the small warships. They have received orders under the new contract for two more and last week the Navy issued Lockheed a contract worth about $700 million for two more. This brings the total of LCS under order from Lockheed to six.

The Navy ultimately plans to operate 30 or more of the ships. They are designed to be equipped with different mission packages depending on the requirements. This includes anti-air, anti-ship and mind warfare among others. Like their name implies they are optimized for in-shore activities such as anti-piracy operations in the Indian Ocean and special warfare.

Even though the defense budget is being cut the Navy remains committed to building substantial numbers of the ship. The fact that it is built in smaller yards allows such construction.

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U.S. Navy Orders 2 of Last 3 JHSV from Austal

Yesterday the U.S. Navy announced that it had executed a contract option for 2 more Joint High Speed Vessels (JHSV) from Australian ferry builder Austal. This brings the total number of these ships ordered to 9.

Austal is close to finishing the first and has two more in production. The contract yesterday will allow the builder to begin buying long lead items and components for the two ships.

The JHSV is a fast transport based on Austal’s ferry designs that was originally planned to be used by the Navy and Army for rapid transport of troops and supplies to needed areas. It was decided that the Navy would manage the whole program and the ships were transferred to them.

Originally it was thought that up to 23 of the ships would be procured but in their FY13 budget proposal the Obama Administration reduced the planned number to 10. This means that 9 of them are now on order with the chance that only one more will be purchased.

Austal is building the ships in their Mobile, AL yard where they also make the Littoral Combat Ship (LCS). They have a contract for up to 10 of these. Interest

Photo from HerrKrueger’s flickr photostream.

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Nation’s Third Littoral Combat Ship Successfully Completes Builder’s Trials — Press Release

Nation’s Third Littoral Combat Ship Successfully Completes Builder’s Trials

MARINETTE, Wis., Oct. 24, 2011 /PRNewswire/ — A Lockheed Martin (NYSE: LMT)-led industry team completed Builder’s Sea Trials for Fort Worth, the nation’s third littoral combat ship.

The trials – a coordinated effort between the U.S. Navy and the Lockheed Martin team including Marinette Marine Corporation (MMC) – were conducted in the waters of Green Bay and Lake Michigan. They included operational testing of the vessel’s propulsion, communications, navigation and mission systems, as well as all support systems.

“Successful completion of Builder’s Sea Trials means we are on track for the Navy’s Acceptance Trials, putting us a big step closer to getting the Navy the ships it needs,” said Joe North, vice president of littoral ship systems for Lockheed Martin’s Mission Systems and Sensors business. “We support the Navy’s effort to grow their fleet affordably and effectively.”

The rigorous trial period included maneuverability tests; high-speed runs; power and navigation system checks; rescue boat launch and recovery; and tracking exercises, as well as other ship and system evaluations.

Following the successful completion of Builder’s Sea Trials, Fort Worth returned to MMC to prepare for Acceptance Trials. LCS 3 will be delivered to the Navy next year and its home port will be San Diego, Calif.

Fort Worth, the second Freedom variant ship in the LCS program, was christened in December 2010. It is more than 96 percent complete and remains on cost and on schedule. LCS 3 is being constructed with 30 percent fewer production hours as a result of lessons learned from designing and building LCS 1, USS Freedom.

The team began construction on LCS 5, the future USS Milwaukee, in August.

Headquartered in Bethesda, Md., Lockheed Martin is a global security company that employs about 126,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. The Corporation’s 2010 sales from continuing operations were $45.8 billion.

For additional information about Lockheed Martin, visit:

http://www.lockheedmartin.com/ms2/ and http://www.lmlcsteam.com

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Navy Goes International for LCS Radar

Update at 1700 CDT – The post has been updated to make clear that the SAAB radar has been selected only for the Austal USA version of the LCS.

The U.S. Navy’s new Littoral Combat Ship (LCS) is a small combatant designed to fight close in to shore. It will carry out a series of different missions including anti-piracy operations, Anti-Submarine Warfare (ASW), surveillance and reconnaissance and sanction enforcement. It is unique to the U.S. Navy at this time in that two very different designs with the same basic capability are being built from two contractors This is to allow rapid production.

LCS construction is being carried out by Lockheed Martin (LMT) teamed with Marinette Marine Corp. of Wisconsin as well as Austal USA, a subsidiary of Australian company Austal. The Navy has ordered 9 of the ships so far split between the two teams.

The Navy announced this week that it has decided to install the Sea Giraffe AMB radar onto the Austal USA version of the LCS. This system is manufactured by SAAB’s (SAABB) American subsidiary. The “Agile Multi-Beam” radar provides air and surface surveillance capabilities and is used to generate a three dimensional picture of the area to support operations. It has already been installed on a variety of combatants in use with countries like Sweden, Canada and Australia.

No value for the contract was given.

The first two, LCS 1, USS Freedom, and LCS 2, USS Independence, have already been completed.

The Navy had gone back and forth on the acquisition strategy for the ship due to concerns about price and schedule after the first two were put on contract. The original plan to use the two sources was ended and there was discussion of ordering batches of ten to a single producer at a time. After the proposals were received for the first contract from Lockheed and Austal the prices were so good the Navy went back to ordering from two suppliers.

Late last year the Navy gave contracts for ten ships each to the two companies.

The LCS remain controversial due to their size, weapon suite and capabilities. The Navy seems committed to the program and has begun large scale production. The decision to use the Sea Giraffe also highlights their commitment. It is uncommon for a non-American system to be ordered like this. The standard U.S. Navy radar and combat system, the AEGIS Weapon System, is much too large for the LCS and buying an existing system like this should save time and schedule.

As with all new classes of ships once they have been in service for a few years, worked out their kinks and demonstrated their capabilities they will be accepted and should be a valuable addition.

Due to the concerns about future shipbuilding budgets and capabilities the LCS if it really is built in the numbers proposed will make up a decent portion of the U.S. surface fleet by mid-Century. Ships last a long time and can receive incremental upgrades as technology progresses and that is what will happen with this class.

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Lockheed Martin Team Lights Off Diesel Generators Onboard Nation’s Third Littoral Combat Ship — Press Release

Lockheed Martin Team Lights Off Diesel Generators Onboard Nation’s Third Littoral Combat Ship

MARINETTE, Wis., May 16, 2011 /PRNewswire/ — A Lockheed Martin (NYSE: LMT)-led industry team reached a key milestone with the “light off” of the ship service diesel generators onboard the nation’s third Littoral Combat Ship (LCS), Fort Worth.

The generator light off signifies the ship is ready to run on its own power and this milestone included the successful light off of the ship’s four 750-kilowatt Fincantieri IsottaFraschini diesel generators. Fort Worth will undergo a series of light offs in coming months in preparation for sea trials, scheduled for later this year. During this time, the Lockheed Martin team will continue its dock-side testing of the ship’s systems at Marinette Marine. Fort Worth will be delivered to the U.S. Navy in 2012.

“The generator light off is an important milestone in preparing Fort Worth to complete testing and set sail, bringing us one step closer to delivering the Navy its next ship in this class,” said Joe North, vice president of Lockheed Martin’s Littoral Ship Systems business. “Throughout this process, the team has remained focused on building on our experience while remaining on schedule and on budget.”

The Lockheed Martin industry team designed and constructed the nation’s first LCS, USS Freedom, which has sailed more than 50,000 nautical miles and demonstrated its capabilities since its commissioning in 2008. Based in its homeport of San Diego, Calif., the ship completed a highly successful maiden deployment in 2010 and is now fully integrated into the fleet.

In addition to Marinette Marine Corporation, a Fincantieri company, the Lockheed Martin-led team for LCS 3 includes naval architect Gibbs & Cox as well as best-of-industry domestic and international companies.

Headquartered in Bethesda, Md., Lockheed Martin is a global security company that employs about 126,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. The Corporation’s 2010 sales from continuing operations were $45.8 billion.

For additional information about Lockheed Martin, visit:

http://www.lockheedmartin.com/ms2/ and http://www.lmlcsteam.com

SOURCE Lockheed Martin

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Navy Continues LCS Production with Orders for Both Teams

Earlier this year the U.S. Navy had gone ahead and awarded contracts to the two builders of the Littoral Combat Ships (LCS) for up to ten ships of their designs. The LCS is a new small warship that will be the a largest class of ships built over the next few decades for the Navy.

Two teams one lead by Lockheed Martin (LMT) and the other by Austal America (ASB:AUS) are building the ships. Lockheed uses the Wisconsin based Marinette Marine as their shipbuilder and Austal utilizes their yard in Mobile, AL. Each team had orders for two but the new contracts increased that to up to 12.

Now the Navy is allocating funding for the ships under these contracts with Lockheed and Marinette receiving a contract for the second ship of their order of ten, LCS 7, which will be named the U.S.S. Detroit. The ships are expected to cost upwards of $400 million when completed but the contract is for about $375 million. The Navy had previously ordered LCS 5, the U.S.S. Milwaukee.

Austal has completed U.S.S. Independence (LCS 2) and is building the U.S.S. Coronado (LCS 4). They received an order for a further LCS at the same time Lockheed did which is worth about $368 million. This should be for LCS 8 but no name or number was given.

The subsidiary of the Australian maker of high speed ferries and other ships had earlier received a contract for engineering support worth about $20 million while Lockheed received one as well worth a little more.

The Navy had originally planned to use multiple sources for the LCS due to the need for the rapid construction of so many ships. This acquisition strategy went through some changes with at one point the Service planning a single source for the second batch after the delivery of the first four ships. Due to the competitive bids received from Lockheed and Austal the Navy asked Congress for permission to use two sources which was approved late last year. This led to the similar contracts for ten ships each.

The Navy has had plans to build upwards of fifty of the ships which while they have dissimilar hull designs carry the same basic payload of weapons and sensors. The ships will conduct a variety of missions including patrol, anti-submarine warfare and mine warfare.

Photo from uscgantareapa flickr photostream.

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Northrop Grumman Goes Ahead with Plan to Exit Shipbuilding

Last year Northrop Grumman (NOC) one of the last two major companies building ships and submarines for the U.S. Navy announced that it would explore separating that part of their corporation. Based on their analysis of future Navy plans for building ships they decided that it would not make sense for them to stay in that business. Management had said that they might sell the whole unit to another company and some other bidders did emerge.

It was felt by some analysts that if Northrop did divide their corporation this way it would set the remaining core company on a path of potential merger with another large contractor such as Boeing (BA). This began to spark concerns that another major round of consolidation was about to happen leading to further shrinkage of the U.S. industrial base. This in turn led to the Department of Defense to state that they would prefer this kind of move not to happen and that the big defense contractors who provide most of the hardware to the U.S. military remain.

Northrop has decided in a way to partly to mollify these concerns to spin off their shipyards into a new company owned by its shareholders. The establishment of Huntington Ingalls Industries would mean that twenty percent or so of Northrop would now reside in the new company. This follows the letting go of TASC two years ago due to Conflict of Interest concerns which had represented another $1.8 billion of business for Northrop and had been a growth area for the company.

The decision to set up the new company rather then sell it to a rival was coordinated with the Navy and is considered by them one way of maintaining both competition and the industrial base in their supporting builders.

Right now the Navy is limited in what they are buying with the largest program in number of ships being the Littoral Combat Ship (LCS) program which is built in smaller yards managed by Mariette Marine and Austal America. The new Huntington will compete for destroyers, submarines and aircraft carriers the number of which ordered will be very small for the foreseeable future.

If the U.S. defense spending does decline in the next few years there will be some consolidation in the defense industry. There has already been a great deal of smaller companies involved in M&A and it would not surprise anyone if one of the larger ones did combine with another. There are only so many programs out there and competition will be fierce for them. The budgetary pressures that the U.S. faces with the current deficits means some sort of cuts will be made especially once the troops return from Afghanistan and Iraq.

Photo from Kevin Burkett’s flickr photostream.

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LCS Spin Off Contracts Begin to be Awarded

At the end of last year the U.S. Navy announced that it would go ahead and use two sources for the new Littoral Combat Ship (LCS). This was a reversion to the original plan for the small warship designed to fight inshore. Contracts were quickly awarded to Lockheed Martin (LMT) and Austal America (ASB:AUS) for ten ships each.

Now a variety of support and sub-contracts are beginning to be announced by suppliers for components to help assemble the new ships. While the two designs have very different hull forms the basic combat systems and weapons will be the same.

BAE Systems (BAE:LSE) has announced that they will fabricate 57-millimeter cannons for the Lockheed ships. These guns will be made at their plant in Minnesota. This is part of Lockheed’s almost $4 billion order for ships.

General Dynamics (GD) received a contract from Austal to build their ship’s combat and seaframe control systems. This is an open architecture system that supports the Navy’s plan to have different combat modules that are interchangeable on the ships.

One of the companies that may stand to gain the most from the contracts is Alcoa (AA). They not only provide engineering support to the Navy for the use of aluminum and other metals in ship construction including the LCS but also make the metal that Austal will use to assemble their LCS in Mobile, AL. If the Navy builds upwards of thirty or forty ships the amount of aluminum required will be quite substantial.

Lockheed also has awarded Rolls-Royce (RR:LSE) a contract for the power plants and propulsion systems. The Lockheed ships will be built at Marinette Marine’s yard in Wisconsin. Rolls-Royce makes the MT30 gas turbine which then uses water jets to propel the LCS.

As the two LCS programs continue more-and-more of these large sub-contracts will be announced as the money and work flows to different parts of the United States and many different companies. This continues to illustrate the economic effects of large defense procurement programs.

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Navy Wastes No Time and Gives New LCS Contracts to Lockheed, Austal

With the split buy acquisition strategy approved by Congress the U.S. Navy wasted no time and ordered up to twenty more of the Littoral Combat Ships (LCS) from its two suppliers.

This week both the teams led by Lockheed Martin (LMT) and Austal America (ASB:AUS) received contracts for one ship plus up to nine more options. As Congress allowed the Navy went out and bought up to twenty ships. Each contract is worth between $460 and $500 million for the first ships. If all twenty are built the two teams will received close to $5 billion each.

While each team is building a dissimilar hull shape the two designs carry similar weapon loads. Lockheed is partnered with Marinette Marine’s yard in Wisconsin. Austal America is building their ships at their facility in Mobile, AL. The ships are designed to be built at smaller yards allowing more rapid construction.

So far the Navy has received three LCS ships. USS Freedom (LCS 1) and USS Fort Worth (LCS 3) were built by Lockheed Martin and USS Independence (LCS 2) by Austal America. The USS Coronado (LCS 4) is under construction in Mobile and is expected to be commissioned in 2012.

If all twenty ships are ordered and delivered under these contracts the LCS class will quickly become one of the largest in the current Navy. Ultimately up to fifty or more of the LCS could be acquired.

The decision to allow the split contracts in line with the original acquisition strategy for the ship rather then just using one source as the Navy had proposed when it restructured the program in 2009 is a boon to Austal and Marinette. Both companies had been planning layoffs and restructuring if they had not one the contract. Now they both will have to ramp up their capabilities to support the Navy’s program.

Photo from avhell’s flickr photostream.

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Latest CRA Allows Navy to Use Multiple Sources for LCS

In the on again off again tale of the Navy’s new small combatant Congress approved the revised acquisition strategy of using multiple sources for the next twenty ships. In the latest Continuing Resolution Authority (CRA) passed by Congress Tuesday and signed by President Obama the Navy is given permission to buy ten Littoral Combat Ships (LCS) from Lockheed Martin (LMT) and Austal America (ASB:AU).

Lockheed will team with Marinette Marine Corp. of Michigan while Austal originally worked with General Dynamics (GD) for the first four LCS but for this round of bidding submitted their own. General Dynamics had decided that for future contracts they might bid by themselves.

Ten days ago the Navy had asked the two bidders to extend their prices while asking Congress for this change in strategy from the plan to buy the next batch of LCS from a sole source. The prices offered were so good that the Navy had decided to try and return to the original LCS acquisition strategy of multiple sources.

Because the plan is to buy fifty or more of the ships the idea of having two or more builders of the small ship would maximize the number being delivered. While the two hull designs are very dissimilar the overall combat load out is the same. The LCS will be optimized for fighting close to shore and be able to carry different equipment so that it may carry out missions such as mine sweeping, anti-piracy as well as fighting other ships and submarines.

The decision is a boon to the U.S. ship building industry as it guarantees work at least for the next few years to two yards rather then one.

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Navy Changes LCS Aquisition Strategy Again Orders for GD and Lockheed

The Littoral Combat Ship (LCS) will be the next mass produced small warship for the U.S. Navy. As it names implies it is designed to operate close to a coast conducting patrol and combat missions. The Navy originally planned when the program began to buy fifty-five of the ships. In order to meet the production goals a novel acquisition strategy for the program was chosen with two different ships built to the same requirements being designed and ordered.

General Dynamics (GD) and Lockheed Martin (LMT) teamed with small shipyards were both given contracts for two ships. The two designs were not much alike with GD and Austal USA using a ship based on Austal’s fast multi-hull ferry designs built in Mobile, AL to deliver USS Independence (LCS-2). Lockheed and Marinette Marine of Wisconsin built a more traditional looking ship the USS Freedom (LCS-1).

Due to schedule delays and the delivery being more complicated then originally planned both teams faced cost growth. Due to this the Navy in late 2009 changed plans and decided to cancel the program and start over with a new competition. Because money had already been spent on LCS-3, the USS Fort Worth, Lockheed was allowed to complete the ship. It was decided to have one contest with a winner being announced this Fall and allow them to build ten ships. In 2015 another contest would be held to choose a builder for the next batch.

This week though the Navy said that the prices submitted by both teams for the competition were so good that they want to change acquisition strategy yet again to buy from both bidders. Obviously this is good news for Austal USA and Marinette and their bigger partners as they may each now get ten ships apiece to build.

This plan makes much more sense and is consistent with the original plan and will allow the LCS to enter service much more quickly in large numbers. It is based though on the bidders meeting their price quotes and this is where Congress may have second thoughts about it. They will be committing to buying a large number of ships at prices that based on the experience of the first three might be too low. This would mean that more money would have to be provided later on or quantities reduced.

There is every reason to think that the two teams can deliver on the prices they bid. They have had experience building ships and their supply chains are established giving good insight into costs. Congress might protest as their will be desire by the respective delegations to give as much work as possible to the shipbuilder in their state.

An interesting turn in the LCS program that will be the future of Navy surface warships for the next few decades as well as affecting revenue and earnings for the companies involved.

Photo from uscglantareapa flickr photostream.

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Navy Moving Forward with New Landing Craft

In the 1980′s as part of the Reagan build up and modernization of the U.S. military the Navy developed and placed into service amphibious assault landing craft based on hovercraft. These Landing Craft Air Cushion (LCAC) have been in service now for almost thirty years and provide the ability to move vehicles and troops at high speed from Naval ships to the shoreline. The Soviets also had introduced hovercraft landing craft but the U.S. with their large amphibious Navy and the Marine Corps operated the most of these systems.

Now the Navy is moving to begin the process of replacing the LCAC. Textron Marine and Land Systems, part of Textron Inc (TXT), announced that they are forming a team including U.S. defense contractor L-3 Communications (LLL) as well as Alcoa Defense, part of Alcoa (AA). The system when it is finally developed and placed into production will be mainly made out of aluminum so the inclusion of Alcoa helps lay the foundation for that process.

The new SSC program is being managed by the NAVSEA command. A presentation about the program from a workshop may be found here.

Another team vying for the contract will be made up of Boeing (BA) and Marinette Marine Corporation (MMC). More information about their team and proposal is here at their website.

The SSC is one of two major programs that are being developed to aid the insertion of Marine and other forces onto a hostile shore. The Marine Corps has been working on the Expeditionary Fighting Vehicle (EFV) for several years. That program is being led by General Dynamics (GD). The program has suffered delays and cost increases and has been criticized but so far has been spared cancellation with the new Obama Administration when they canceled programs like the VH-71 Presidential Helicopter.

These two programs when complete will represent a significant modernization of the Navy and Marine Corps’ ability to project power ashore at high speed. The SSC will be able to move heavy equipment such as tanks ashore while the EFV will carry the infantry needed to conduct battles. The EFV is also designed to fight ashore and act as an armored carrier.

Both of these efforts represent significant work for GD and the winners of the SSC competition.

Photo from UNC-CFC-USFK flickr photostream.

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Littoral Combat Ships (LCS) See Growth In Prices

The Littoral Combat Ship (LCS) is a new class of light warships for the U.S. Navy designed to fight close inshore and have the ability to mix-and-match its systems to the mission requirements. The Navy currently has ordered four of the controversial ships two each from Northrop Grumman and General Dynamics. The plan is to buy three more in 2010 from one or both of the contractors.

Due to cost growth in the first two ships the Navy had at one point had canceled the contracts for ships 3 and 4. Congressional pressure made them order these next two ships. The initial estimate was that the ships would cost $220 million on average but the price tags have slowly escalated over time. Now LCS 1 is estimated to cost $637 million and hull 2 $704 million. Congress has placed a cap of only $460 million for the average cost. The Navy originally intended to build over fifty of the vessels.

With the continued cost growth of the existing program it is hard to see how the Navy can continue it. There will have to be a restructuring of the costs and number of ships planned. If not the program will like the bigger DDG-1000 class look like a good candidate to end with the Navy having to accept a new design or continue constructing existing ships.

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Navy Awards LCS Contract

The U.S. Navy awarded Marinette Marine a contract modification in order to “preserve production capability” for the Littoral Combat Ship (LCS) program. The Business Journal reports that Marinette Marine was part of a team with Lockheed Martin that built one of the first two LCS ships for the Navy. The Navy plans to award two more ships and it was believed that only one of the two teams that had built a ship each would qualify for this next order. This contract action prevented Marinette Marine from cutting back on its work force, hence the preserving part. There is still no guarantee that the company will get further LCS work but it keeps the option open.

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