Northrop Grumman Gets $154.9M Navy Deal

Wednesday, June 06, 2001
The U.S. Navy awarded Ingalls Shipbuilding, a Northrop Grumman company, a $154.9 million contract to begin advance procurement of materials for the construction of future DDG 51 Class Aegis destroyers. The contract is to purchase a variety of DDG class equipment items for three additional Aegis destroyers authorized by Congress. Actual ship construction contracts are to be awarded to Ingalls and Bath Iron Works in a single, multiyear procurement process to be conducted later this year. The multiyear procurement plan calls for a total of six ships -- three to Bath, three to Ingalls -- with funding scheduled during a three-year period from the 2002 through 2004 fiscal years. The advanced procurement plan, the Economic Order Quantities, allows both shipbuilders to place orders for equipment for all ships authorized during the three-year period. This process allows the shipbuilders and their suppliers to plan for multiship procurement, saving millions of dollars. This material procurement contract funds the advance purchase of long-lead time equipment such as engines, gears, generators, air conditioners and other major items. Since 1987, Ingalls has been awarded contracts to construct 24 Aegis destroyers and has delivered 14 of the ships to the Navy a combined 61 weeks ahead of schedule. "This procurement contract marks the continuation of a very efficient approach toward the construction of these vital ships for the Navy," said Jerry St. Pe, chief operating officer of Northrop Grumman Ship Systems. "Efficiency in building these destroyers, an area in which Ingalls has excelled, provides the means to build these ships in the numbers necessary to fully support the Navy's missions."
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