Lockheed Martin Awarded Contract for Sonar Upgrades for U.S. Navy Submarines

Monday, February 14, 2005
The U.S. Navy has awarded Lockheed Martin (NYSE:LMT) a contract valued at more than $61 million for continued support to the Acoustic Rapid Commercial Off-The-Shelf (COTS) Insertion (A-RCI) program. A-RCI is a sonar system upgrade installed on all classes of U.S. Navy submarines. The system integrates and improves the processing of data from sensors including the towed array, hull array and sphere array. These improvements are achieved by use of COTS-based hardware and software that speeds processing while enhancing fidelity.

The contract will provide engineering, technical services and associated materials for the design and development of upgrades and systems support for the A-RCI program. Work performed under the contract will include interfaces to the legacy systems; signal processing enhancements; display enhancements; and incorporation of improved computing algorithms. The A-RCI program provides common sonar systems within an open systems architecture that exploits commercial computing technology, enabling powerful algorithms to detect and classify the slightest underwater sounds, giving U.S. Navy Sailors a "first alert" in the challenging undersea environment. In 2004, Lockheed Martin delivered eight upgrades to U.S. Navy submarines. Since program inception in 1998, A-RCI systems have been installed on 44 submarines, consistently on schedule and under budget, and are scheduled to be installed on all active submarines.

"The A-RCI Program continues to serve as a model for spiral development, open architecture, fleet support, and customer responsiveness," said Rear Admiral John D. Butler, Program Executive Officer, Submarines, for the U.S. Navy. This contract will include both A-RCI back-fits on existing submarines and forward-fits on the new Virginia Class attack submarines, tasks previously separated in two contracts. The single contract structure will provide cost savings through workload reduction and streamlining of Navy and Lockheed Martin interfaces. Further, the contract's multi-year terms, which enable volume purchases, material reuse, and more efficient industry teaming arrangements, will realize additional cost savings. "Innovation and process improvement have become the hallmarks of this program," said Captain Gib Kerr, Navy Program Manager. "By including all stakeholders in the process continuum, we continue to meet or exceed our cost and schedule objectives, while at the same time show an agile, flexible approach to the fleet's ship delivery, installation, training, and support needs." "Delivering this capability to the fleet and getting feedback from the Sailors keeps our team focused on the customer's mission," said Rick Udicious, vice president of Submarine Programs for Lockheed Martin Maritime Systems & Sensors (MS2). "We're delighted the Navy has entrusted us to keep providing our nation's submariners with the tools they use every day they're underway."

The A-RCI program uses a process called the Advanced Processing Build (APB) to drive greater advances in the program. This practice provides a "competitive window" through which improvements are assessed and evaluated across the entire technology base. The APB process leverages developments across surveillance, surface, and submarine programs to get the most from U.S. Navy and industry R&D investments, and it allows robust small business participation. The success of the A-RCI program has allowed the formation of a new pilot program called Maintenance Free Operating Period, which allows combat systems maintenance to be deferred to the next in-port interval by providing system redundancy on the submarines. The program's objective is to transform maintenance practices, supply support systems, training concepts, and life-cycle support, by enhancing operational performance.

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