Navy Awards $22B Contract to Electric Boat, Newport News Shipbuilding for 9 Block v Virginia Subs

 In GDI, Industrial, Sea, Air

Sailors aboard to Pre-Commissioning Unit (PCU) Delaware (SSN-791) on Nov. 5, 2019. US Navy Photo

THE PENTAGON – The Navy signed its largest ship­build­ing con­tract ever, award­ing a $22.2‑billion con­tract to General Dynamics Electric Boat and Huntington Ingalls Industries’ Newport News Shipbuilding for nine Virginia-class Block V attack sub­marines.

The con­tract award comes amid a flur­ry of activ­i­ty in nuclear ship­build­ing, with com­mon sup­pli­ers try­ing to bal­ance the start of the Columbia-class bal­lis­tic mis­sile sub­ma­rine pro­gram, a two-ship buy in the Ford-class air­craft car­ri­er pro­gram and the tran­si­tion of the Virginia pro­gram from the Block IV design to Block V, which adds in acoustic supe­ri­or­i­ty enhance­ments and 28 Tomahawk mis­sile tubes. The Navy has long said the Columbia SSBN pro­gram is its top pri­or­i­ty in the com­ing years, but the fleet des­per­ate­ly needs more attack sub­marines as well.

“Our whole phi­los­o­phy going into this is, get Virginia as a sta­ble foun­da­tion which then we can build Columbia on top of,” James Geurts, the assis­tant sec­re­tary of the Navy for research, devel­op­ment and acqui­si­tion, told reporters today.
“We real­ly want­ed to make sure we had, from both sides, a bal­anced, sta­ble foun­da­tion; showed our com­mit­ment to the indus­tri­al base; showed our com­mit­ment to our sup­pli­ers; showed our com­mit­ment to the work­force – from that, then we can add Columbia on top.”

Though the Navy, indus­try and law­mak­ers had pre­vi­ous­ly expressed inter­est in expand­ing this Block V con­tract beyond the pre­vi­ous­ly planned 10 sub­marines – with talk of options for as many as 13 boats at one point – the con­tract cov­ers nine boats with an option for a 10th. All would include the acoustic supe­ri­or­i­ty upgrades, and all but the first boat – SSN-802, which is already under con­struc­tion – would include the Virginia Payload Module that adds the 28 mis­sile tubes. If the option for the 10th sub were exer­cised, the total con­tract val­ue would come to more than $24 bil­lion.

Geurts told reporters the nego­ti­a­tions were so lengthy – wrap­ping up last month, after an expect­ed April con­tract award – “so we both could get into a place where we’re com­fort­able. So get­ting into a two-per-year cadence in a way that we could also exe­cute that dur­ing Columbia. I think it was a lot of hard work on both sides to get to a place where we had shared risk, shared reward, and that’s kind of ulti­mate­ly why we’ve put one of the boats as an option price, so that we could, if per­for­mance war­rants as we see it, we can add a 10th boat in there; if not, we can back off a lit­tle to make sure Columbia is suc­cess­ful.”

Geurts said the upcom­ing Fiscal Year 2021 bud­get request would show more of the planned sub­ma­rine acqui­si­tion and deliv­ery sched­ule with­in Block V, but he said the option was writ­ten so that it could be exe­cut­ed in any year the Navy choos­es, if the ser­vice can secure fund­ing for the boat.

Though the fate of the 10th sub is unclear at the moment, the sup­pli­ers in the Virginia-class pro­gram will still be paid to deliv­er 10 ship sets of goods under the con­tract, to keep their work­loads sta­ble as they move towards a mas­sive increase in work as the Columbia pro­gram comes online. The Columbia SSBN relies on many of the same sup­pli­ers – prime con­trac­tors Electric Boat and Newport News Shipbuilding, major sup­pli­ers like Lockheed Martin and L3, and thou­sands of small busi­ness­es scat­tered across the coun­try – as the Virginia-class SSNs, and ensur­ing a smooth ramp-up of work­load for those sup­pli­ers is key.

Rear Adm. David Goggins, the pro­gram exec­u­tive offi­cer for sub­marines, told reporters dur­ing the media round­table today that the con­tract includes $455 mil­lion for mate­r­i­al for the pos­si­ble 10th boat.

“From a ven­dor base per­spec­tive, they’re see­ing 10 ships,” which allows them to stay on their planned work­load ramp-up with­out dis­rup­tion.

“Our whole idea on the sup­ply base was, order 10 ship sets so we didn’t have to rene­go­ti­ate sup­pli­er agree­ments. That’s what they were plan­ning to build to with Columbia, so from the sup­ply base, we’ve tried to real­ly min­i­mize the impact to them,” Geurts added.
“They’re such a vital part of our abil­i­ty to deliv­er these sub­marines. It’s all about a sta­ble foun­da­tion – so in our best inter­est, that was pro­vid­ing a sta­ble foun­da­tion, and we’ll always have a use for that equip­ment on a fol­low-on Block VI” sub­ma­rine, if the Navy doesn’t end up award­ing the option for a 10th Block V boat and using the mate­r­i­al then.

Though the con­tract for nine or 10 sub­marines takes care of indus­tri­al base con­cerns and bal­anc­ing risk between the Virginia and Columbia sub­ma­rine pro­grams, it doesn’t direct­ly address fleet con­cerns: chiefly, that the com­bat­ant com­man­ders need more attack sub­marines than they have access to. The Navy is fac­ing a decrease in sub­ma­rine inven­to­ry in com­ing years before the num­bers even­tu­al­ly rise again and reach the require­ment – 66 attack subs – in 2048, accord­ing to inven­to­ry pre­dic­tions in the FY 2020 ship­build­ing plan.

Goggins said he’s pleased with the bal­ance struck between oper­a­tor needs and builders’ band­width.

“To me, it was the over­all bal­ance between Virginia, Columbia and the Ford pro­grams. The con­sid­er­a­tions were the tech­ni­cal risk, the indus­tri­al base capa­bil­i­ty and capac­i­ty, and the fleet require­ments. So this is real­ly the right bal­anced approach from a fleet per­spec­tive,” the rear admi­ral said.

Though the con­tract won’t cov­er as many new boats as pre­vi­ous­ly hoped, the Navy is mak­ing a con­cert­ed effort to get its new sub­marines into the hands of oper­a­tors faster. Goggins said the time from start of con­struc­tion to the boat being turned over to the fleet – includ­ing con­struc­tion, sub­se­quent test­ing and then the post-shake­down avail­abil­i­ty – has decreased by three and a half years over the life of the Virginia pro­gram. He added the ships are being built to a much high­er qual­i­ty and receiv­ing much bet­ter scores dur­ing sea tri­als – the last boat, the future Delaware (SSN-791), scored a “pret­ty phe­nom­e­nal” .96 in its late October tri­als – which means less work to be done after com­mis­sion­ing, and there­fore a faster turn­around time before the crew can get onboard and start tak­ing on mis­sions.

“The crews are ready” upon ship deliv­ery, Goggins, said, and “we’ve had a cou­ple sub­marines, short­ly after deliv­ery they’ve gone on task­ing as direct­ed by the fleet com­man­der.”

Guerts said that, in addi­tion to the faster turn­around time, “now we’re adding lethal­i­ty” through the acoustic supe­ri­or­i­ty upgrades and the Virginia Payload Module, “to ensure not only are they get­ting the ship they need, they’re get­ting it with more fire pow­er, with a more com­pet­i­tive com­par­a­tive advan­tage.”

Source: USNI

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