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Avondale Alliance Claims Victory In LPD-17 Bid War

On Dec. 17, an Avondale-led coalition was awarded a contract worth $641 million to design, construct and support the U.S. Navy's initial LPD-17 ship, with an option covering two additional ships which could potentially bring the deal value to $1.5 billion.

Selected to represent the commercial sector on an industry-Navy team, the Avondale Alliance — also consisting of Bath Iron Works, Hughes Aircraft and Intergraph Corp. — beat out the impressive consortium of Ingalls Shipbuilding, Newport News Shipbuilding, National Steel and Shipbuilding Co. and Lockheed Martin for this monumental contract, which will supply the Navy with its next generation of amphibious warships.

Avondale will reportedly build the first two ships while the third will be constructed by General Dynamics subsidiary Bath Iron Works (BIW), located in Maine. Hughes Aircraft willbe responsible for integrating the ships' electronic and weapons systems into the construction process.

The significance of the LPD-17 contract goes beyond the construction of next-generation warships. This contract is unique because it has been inherently designed to give the industry team the capability to provide real-time, continuous process streamlining. The Avondale Alliance will utilize the flexibility of the commercial sector to lead the development and procurement of advanced ships systems which will be integrated in ship production, in response to the emerging technological requirements of the Navy.

In contrast to the majority of U.S. naval shipbuilding programs, the operational core of the project will be established not in Washington, D.C., but on location at the prime contractor's facilities in Louisiana.

By giving the Avondale Alliance a stake in the project that extends over the service life of the vessels until at least 2040, the U.S. government will be able to reap the benefits of a long-term contractual relationship, which according to U.S. Navy LPD-17 Program Manager Capt.

Maurice Gauthier, includes the assimilation of the commercial sector's expert knowledge combined with a reduction in government infrastructure, which in the past has acted as a logistical stumbling block in the Navy's quest to build the most technically capable, fully integrated warships.

"The LPD-17 program is the lifeblood of the industrial base. As the only new naval surface ship construction program for the remainder of the century, it provides industry with the opportunity to advance to 21st Century shipbuilding," stated Capt. Gauthier in a editorial recently published in MR/EN supplement Marine Technology International.

On the day following the contract award, American Shipbuilding Association President Tom Bowler had some comments for MR/EN. "If you look at what the LPD-17 is doing, it's taking a step in two directions," said MrBowler, a retired Navy captain and head of the association that represents the interests of the yards on both sides of the LPD-17 bid war.

"One thing LPD-17 is doing is having the equipment side and the shipbuilders team. The idea is to get the government out of the interface between the two. The other thing it has tried to do is to get shipyards to work together," said Mr. Bowler.

He agreed that the contract is groundbreaking because it deviates from traditional Navy shipbuilding programs in which builders and suppliers of weapons, sensors and other digital systems have been awarded separate contracts without provisions for coordinated systems integration, as will be mandated by the Integrated Product and Process Development (IPPD) team under LPD-17. "What the LPD-17 has tried to do is to allow the process to have more flexibility without blind adherence to military specifications," stated Mr. Bowler.

In a statement released to the press, Albert L. Bossier, Jr., chairman and CEO of Avondale Industries, Inc., laid out the Alliance's plans for implementing the work order: "Work on the initial LPD-17 is to begin immediately, and delivery of the first ship is expected in 2002. This schedule fits well with the existing backlog which includes the Strategic Sealift contract for six ships," said the yard executive.

He continued: "The Navy has indicated an intent to acquire as many as 12 vessels under the LPD-17 program. If all of the 12 ships are awarded to the Avondale Alliance, this would mean the potential of a shipbuilding program which is anticipated to exceed $6 billion for the Alliance, a high utilization of our shipyard resources for about ten years and the employment of approximately 4,000 Avondale employees at peak production for this program." Mr. Bossier also indicated that if the Navy placed the full LPD-17 contract with the Alliance, Avondale would build eight ships and BIW would build four.

Ingalls President Jerry St. Pe' offered the following comments following the contract announcement: "While we are disappointed by the outcome of the LPD-17 award, Ingalls remains confident about our company's future and the prospects to remain one of the country's most successful designers and builders of naval vessels. Without LPD-17, we will be looking more aggressively at all other programs that may be available to us." With a backlog that includes eight Aegis destroyers and three LHD amphibious assault ships, Ingalls will intensely lobby to build the Navy's planned 19 destroyers and a new class of Arsenal ships. The yard will also pursue international navy contracts for a corvette class of vessels, such as those built for the Israeli Navy. LPD-17 Specifications Length: 683.7 ft. (208.4 m) Width: 104.6 ft. (31.9 m) Displacement: 25,300 mt Propulsion: (4) diesels on two shafts Speed: 22+ knots

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