Bollinger, Austal awarded LCS final design contract

Two groups were awarded contract options from the Navy in late May for the final design of the agency’s littoral combat ships (LCS).

The General Dynamics-Bath Iron Works team, which includes Australia-based Austal Ltd., received a $78.8 million final system design contract from the U.S. Department of Defense. The Lockheed Martin Corp. team, which includes Lockport, La.-based Bollinger Shipyards Inc. and Marinette (Wis.) Marine Corp., was awarded a $46.5 million final design contract. The contracts contain options for detail design and construction of up to two LCSes from each team. The cost difference reflects the more complex hull design envisioned by the General Dynamics team.

If the options are exercised, Austal USA in Mobile, Ala., will build the ships for the General Dynamics team. Austal would start work on the lead vessel in late 2005 and the second in late 2006. The contract, including options for both ships, has a total value of $536 million. 

Marinette, a subsidiary of The Manitowoc Company Inc., would build the lead ship for the Lockheed Martin team. Construction would begin in early 2005 with the launch scheduled for 2006. Bollinger would begin construction of the follow-up ship at its Lockport facility in early 2006. The contract, including options, has a potential total value of $423 million.

The semi-planing monohull design proposed by the Lockheed Martin group and the trimaran hull proposed by the General Dynamics team would operate in shallow coastal environments. The ships’ missions include anti-submarine, surface and mine warfare. The ships will also support launch and recovery operations, and have the capability to turn 360° in less than eight lengths and accelerate to full speed in less than two minutes. Depending on its load, the ship’s top speed will range from 45 to 60 knots.

Bollinger officials estimate that the prototype vessel will cost $220 million. Austal officials say the entire contract, if all 56 to 60 ships are built, could total close to $14 billion. The Navy said last year that plans call for a minimum of 30 LCSes.

“From the outset of this competition, we have been focused on delivering a truly transformational, high-speed solution with minimum risk and cost to the Navy,” said Mike Ellis, executive vice president and chief operating officer at Bollinger Shipyards. “This clear win for our team not only demonstrates the Navy’s confidence in our platform, but also our team’s ability to execute beyond expectations.”

After the 16-month final design stage, Austal said it expects the Navy to exercise options with each team to build two vessels each. 

Austal Ltd.’s Executive Chairman John Rothwell said the announcement was a positive indication that Austal would soon be building its first ship for the Navy.

“This team is now in the final stage before the first construction contracts are awarded, and we expect this to lead to a shipbuilding contract, probably in the second half of next year,” Rothwell said in a prepared statement.

Ellis said the Navy could award contracts to both teams or choose not to award construction contracts to either team.

“The Navy has a lot of flexibility in what they can do,” he said. “Right now, our focus is on the prototype and delivering beyond expectations.”

Both Bollinger and Austal said the awards could result in the construction of new facilities to handle the contract.

“Right now (Bollinger) is planning on building the prototype at the Lockport facility,” Ellis said. The construction of a new facility or expanding existing facilities “depends on the Navy’s delivery schedule.”

Ellis said the construction of a prototype would likely employ between 500 and 600 people at Bollinger.

Likewise, Austal officials said initial construction of the prototype would be handled at its existing Mobile facility. But the company could expand on property it owns adjacent to its current shipyard.

“Any expansion would be at the same location,” said Chris Pemberton, Austal USA’s vice president, sales and marketing. “But there’s no firm time scale yet.”

Groups headed by Lockheed Martin, Bath Iron Works and Raytheon made the first cut and were awarded contracts last summer for preliminary design work on the LCS. There were originally six teams vying for the Navy LCS contract.       — Matt Gresham

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