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NEWS | Sept. 28, 2018

Navy Awards DDG 51 FY18-22 Multiyear Procurement Contracts

By Team Ships Public Affairs

WASHINGTON – Today, the Navy awarded two contracts for the DDG 51 fiscal years (FY) 2018 - 2022 multiyear procurement (MYP) for DDG 51 Arleigh Burke class destroyers.  

"These contract awards are further evidence of the Navy's continued delivery of lethal capacity to the Nation with a sense of urgency while ensuring best value for the taxpayer," said James F. Geurts, assistant secretary of the Navy for research, development and acquisition.   "The Navy saved $700 million for these 10 ships by using multiyear procurement contracts rather than a single year contracting approach. We also have options for an additional five DDG 51s to enable us to continue to accelerate delivery of the outstanding DDG 51 Flight III capabilities to our Naval force.  We executed this competition on a quick timeline that reflects the urgency in which the Navy and our industry partners are operating to ensure we meet the demands of the National Defense Strategy."

General Dynamics Bath Iron Works is being awarded a $3,904,735,559 fixed-price incentive firm target (FPIF) contract for the design and construction of four DDG 51 class ships, four in FY 2019-2022.  

Huntington Ingalls Industries is being awarded a $5,104,668,778 fixed-price-incentive firm target (FPIF) contract for the design and construction of six DDG 51 class ships, six in FY 2018-2022.

These multiyear procurement awards are for a total of 10 MYP ships.  Additionally, each shipbuilder’s contract contains options for additional ships in FY18/19/20/21/22, providing the Navy and/or Congress flexibility to increase DDG 51 build rates above the 10 MYP ships in the Navy’s FY 2018 budget request, if appropriated.  
"This procurement will efficiently provide Integrated Air and Missile Defense capability for our future fleet while strengthening our critical shipbuilding and defense industrial base," said Capt. Casey Moton, DDG 51 class program manager, Program Executive Office Ships.  "The Navy is proud to be working alongside the dedicated shipbuilders at BIW and Ingalls to continue to deliver these warships to the fleet."

The acquisition strategy included the procurement of 10 DDG 51 class ships from FY 2018-2022 using MYP authority to competitively award ships among the two current DDG 51 class shipbuilders.  The MYP ships were competed using a combination of historically successful competitive strategies, primarily using a Compete for Quantity (CFQ) strategy with one Profit Related to Offer (PRO) outcome also possible. 

The destroyers are being procured in a Flight III configuration, relying on a stable and mature design while delivering critical Integrated Air and Missile Defense capability with the AN/SPY6(V)(1) Air and Missile Defense Radar.