DoD Awards $183M Contract for Ship Alteration Work to Huntington Ingalls Inc

Contract Overview

Contract Amount: $183,347,823 ($183.3M)

Contractor: Huntington Ingalls Incorporated

Awarding Agency: Department of Defense

Start Date: 2019-04-26

End Date: 2028-09-13

Contract Duration: 3,428 days

Daily Burn Rate: $53.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: SHIP ALTERATION WORK

Place of Performance

Location: PASCAGOULA, JACKSON County, MISSISSIPPI, 39567

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $183.3 million to HUNTINGTON INGALLS INCORPORATED for work described as: SHIP ALTERATION WORK Key points: 1. Significant contract value of $183.3 million for ship alteration services. 2. Awarded to Huntington Ingalls Incorporated, a major player in shipbuilding and repair. 3. Full and open competition was utilized, suggesting a competitive bidding process. 4. The contract spans nearly a decade, indicating long-term service requirements.

Value Assessment

Rating: fair

The contract type is Cost Plus Award Fee (CPAF), which can lead to higher costs if not managed effectively. Benchmarking against similar ship alteration contracts is difficult without more specific service details.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which generally promotes competitive pricing. However, the Cost Plus Award Fee structure allows for costs plus potential award fees, which may not always result in the lowest possible price.

Taxpayer Impact: Taxpayer funds are being used for extensive ship alteration work. While competition is present, the CPAF structure warrants careful oversight to ensure cost efficiency and value for money.

Public Impact

Supports naval readiness and modernization efforts through essential ship alterations. Impacts the shipbuilding and repair sector, potentially creating jobs and stimulating economic activity. Ensures the U.S. Navy's fleet remains operational and capable through necessary upgrades and repairs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee structure can incentivize cost overruns.
Long contract duration may lead to scope creep or evolving requirements.
Limited insight into specific performance metrics and award fee triggers.

Positive Signals

Awarded through full and open competition.
Contract supports critical defense infrastructure.
Experienced contractor selected for complex work.

Sector Analysis

This contract falls within the shipbuilding and repair sector, a critical component of national defense. Spending benchmarks for ship alteration work can vary widely based on the complexity and scope of the alterations required.

Small Business Impact

The data does not indicate any specific subcontracting goals for small businesses on this contract. Further investigation would be needed to determine if small businesses are participating in this significant defense expenditure.

Oversight & Accountability

The contract's Cost Plus Award Fee structure necessitates robust oversight from the Department of the Navy to ensure cost control and contractor performance align with award fee criteria and taxpayer interests.

Related Government Programs

Ship Building and Repairing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Potential for cost overruns due to CPAF structure.
Long contract duration increases risk of scope creep.
Lack of detailed performance metrics in public data.
Limited visibility into small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $183.3 million to HUNTINGTON INGALLS INCORPORATED. SHIP ALTERATION WORK

Who is the contractor on this award?

The obligated recipient is HUNTINGTON INGALLS INCORPORATED.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $183.3 million.

What is the period of performance?

Start: 2019-04-26. End: 2028-09-13.

What specific types of ship alterations are included in this contract, and how do they align with current naval modernization priorities?

The specific types of alterations are not detailed in the provided data. However, ship alteration contracts typically encompass a range of modifications, including upgrades to combat systems, propulsion, habitability, and structural enhancements. These are generally aligned with naval modernization priorities aimed at maintaining fleet readiness, incorporating new technologies, and extending the service life of vessels.

What are the key performance indicators (KPIs) and award fee criteria used to evaluate Huntington Ingalls' performance under this Cost Plus Award Fee contract?

The provided data does not specify the key performance indicators or award fee criteria. Typically, for ship alteration contracts, KPIs might include on-time completion, adherence to technical specifications, quality of workmanship, and safety performance. Award fee criteria would be directly linked to achieving or exceeding these KPIs, incentivizing the contractor to deliver high-quality work efficiently.

How does the $183 million contract value compare to historical spending on similar ship alteration projects for the Department of the Navy?

Without specific details on the scope and complexity of the alterations, a direct comparison is challenging. However, $183 million represents a substantial investment. Historical spending on major ship alterations can range from tens to hundreds of millions of dollars, depending on the class of vessel, the extent of modernization, and the specific systems being modified. This contract appears to be within the upper range for significant alteration projects.

Industry Classification

NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing

Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0002418R4313

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Huntington Ingalls Industries, Inc

Address: 1000 ACCESS RD, PASCAGOULA, MS, 39567

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $659,844,058

Exercised Options: $659,844,058

Current Obligation: $183,347,823

Actual Outlays: $11,552,867

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline