Austal and Lockheed Martin Wins $1.4Bn to Build two additional LCS Ships from US Navy

The Navy issued contract modifications to Lockheed Martin Corporation and Austal USA under their respective Littoral Combat Ship (LCS) block buy contracts to add funding for construction of two fiscal year 2012 littoral combat ships each, March 16. This is the third funding increment for each contractor under their previously awarded, fixed-price incentive "block buy" contracts for the design and construction of up to 10 LCS Flight 0+ ships. The two block buy contracts provide for the acquisition of a total of up to 20 littoral combat ships from fiscal year 2010 through fiscal year 2015, subject to availability of appropriations. Under the block buy contract with Lockheed Martin Corporation, $715,000,351 was added for construction of two fiscal year 2012 LCS ships. Under the block buy contract with Austal USA, $691,599,014 was added for construction of two fiscal year 2012 LCS ships. These ships will be built at Marinette Marine Corporation in Marinette, Wis., and Austal USA in Mobile, Ala., respectively. The U.S. Navy has issued a Lockheed Martin-led industry team a $715 million contract modification to add funding for construction of two Littoral Combat Ships (LCS) – the third and fourth in a 10-ship contract awarded in December 2010. The contract modification is for construction of Little Rock (LCS 9) and Sioux City (LCS 11). Construction on the first and second ships awarded under this contract, Milwaukee (LCS 5) and Detroit (LCS 7), is already underway. Two ships awarded under previous contracts include USS Freedom (LCS 1), currently being prepared for her next deployment, and Fort Worth (LCS 3), scheduled to be commissioned in September. "Our shipbuilding program has benefitted greatly from our experience with USS Freedom, resulting in increased affordability and streamlined production," said Joe North, vice president of littoral ship systems at Lockheed Martin's Mission Systems & Sensors business. "We have listened to customer feedback from our lead ship and we continue to invest in areas that will bring additional efficiencies to the future LCS ships." Austal’s order backlog has grown by US$691 million as a result of two additional Littoral Combat Ship (LCS) contract options being exercised by the United States Navy. The contract options fund construction of the Gabrielle Giffords (LCS 10) and Omaha (LCS 12), the third and fourth ships in the 10 ship block buy award made to an Austal-led team in December 2010. That 10 ship program is potentially worth over US$3.5 billion. Reflecting Austal’s growing stature in naval shipbuilding, Austal USA now holds confirmed contracts for 14 U.S. Navy ships while its Australian operation has a contract to build and support eight patrol boats for the Australian Customs and Border Protection Service.