The Navy awarded six of its next Arleigh Burke-class destroyers to Ingalls Shipbuilding and four to General Dynamics Bath Iron Works, in a combined $9-billion purchase right at the end of the fiscal year.
The two companies had been competing for work in a five-year multiyear procurement (MYP) deal that would cover at least 10 Flight III destroyers. The contracts span Fiscals Years 2018 – which ends on Sunday – through 2022.
“These contract awards are further evidence of the Navy’s continued delivery of lethal capacity to the nation with a sense of urgency while ensuring best value for the taxpayer,” Navy acquisition chief James Geurts said in a Navy news release.
“The Navy saved $700 million for these 10 ships by using multiyear procurement contracts rather than a single year contracting approach. We also have options for an additional five DDG 51s to enable us to continue to accelerate delivery of the outstanding DDG 51 Flight III capabilities to our Naval force. We executed this competition on a quick timeline that reflects the urgency in which the Navy and our industry partners are operating to ensure we meet the demands of the National Defense Strategy.”
Ingalls Industries’ contract is worth $5.1 billion and covers two ships in FY 2018 and one a year in FY 2019 through 2022. It also includes options for additional ships, which may be subject to a future competition with BIW.
Bath Iron Works’ contract is valued at $3.9 billion and covers one ship a year in 2019 through 2022 – and none in the short-term in 2018.