Austal USA to Prime LCS Bid

Tuesday, March 09, 2010

Austal USA and Bath Iron Works (BIW) have agreed to revoke their current teaming arrangement. This strategic decision allows Austal USA to act as prime contractor in the upcoming bid for 10 U.S. Navy Littoral Combat Ships (LCS).

The U.S. Navy is expected to award the contract for two LCSs, including options for an additional eight vessels, by the end of US FY10. In the event that Austal USA is awarded the FY10 contract, potentially worth up to $4.8b, it will continue to act as Prime Contractor for future LCS bids.

General Dynamics Advanced Information Systems, which is currently the systems integrator in the program, will now subcontract to Austal USA, as it currently does in the Joint High Speed Vessel (JHSV) program, providing open architecture systems that deliver better, faster and more affordable capability.

The U.S. Navy has also determined that an additional five-ship contract, to be awarded in FY12, shall not be awarded to the same contractor as the 10-ship contract. Therefore, revoking the current agreement will allow BIW to bid as the second source LCS shipbuilder.

BIW will continue to act as Prime Contractor for Austal’s second LCS, Coronado (LCS 4), which is currently under construction at Austal USA and due for completion in 2012.

As Prime contractor, Austal was awarded the construction contract for the first 338 ft Joint High Speed Vessel (JHSV), the U.S. Department of Defense’s next generation multi-use platform, in November 2008, with options for nine additional vessels expected to be exercised between FY09 and FY13. Austal received authorization from the Navy to start construction on JHSV 1 in December 2009 after completing the rigorous design in a 12-month period. On January 28, 2010, Austal was instructed by the Navy to move forward with the construction contract for the second and third JHSVs, as part of a total 10-ship program potentially worth over $1.6b. Austal is teamed with General Dynamics Advanced Information Systems who will design, integrate, and test the ship’s electronic systems, including an Open Architecture Computing Infrastructure, internal and external communications, electronic navigation, aviation, and armament systems.

(www.austal.com)

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