Navy Awards $2.65 Billion for FFG(X) Frigate Detail Design and Construction to Marinette Marine
Contract Overview
Contract Amount: $2,647,840,821 ($2.6B)
Contractor: Marinette Marine Corporation
Awarding Agency: Department of Defense
Start Date: 2020-04-30
End Date: 2034-05-31
Contract Duration: 5,144 days
Daily Burn Rate: $514.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: DETAIL DESIGN AND CONSTRUCTION OF FFG(X) GUIDED MISSILE FRIGATE
Place of Performance
Location: MARINETTE, MARINETTE County, WISCONSIN, 54143
Plain-Language Summary
Department of Defense obligated $2.65 billion to MARINETTE MARINE CORPORATION for work described as: DETAIL DESIGN AND CONSTRUCTION OF FFG(X) GUIDED MISSILE FRIGATE Key points: 1. Significant investment in naval shipbuilding, focusing on advanced frigate capabilities. 2. Competition for the FFG(X) program was robust, aiming for best value. 3. Risk associated with long-term, complex defense contracts is inherent. 4. Spending falls within the shipbuilding and repair sector, a critical defense industry.
Value Assessment
Rating: good
The contract value of $2.65 billion for detail design and construction is substantial. Benchmarking against similar large-scale naval vessel construction projects suggests this is within a reasonable range, though specific performance metrics will be key.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating a competitive bidding process. This method is designed to foster price discovery and ensure the government receives competitive pricing.
Taxpayer Impact: This large contract represents a significant taxpayer investment in national defense capabilities, aiming to deliver advanced naval assets.
Public Impact
Enhances U.S. naval fleet capabilities with modern guided missile frigates. Supports jobs in the shipbuilding and repair industry, particularly in Wisconsin. Long-term project with implications for future naval procurement strategies.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (over 13 years) increases risk of cost overruns and schedule delays.
- Fixed Price Incentive (FPI) contract type requires careful monitoring of performance and cost targets.
- Potential for scope creep in complex defense projects.
Positive Signals
- Awarded under full and open competition, suggesting competitive pricing.
- Focus on detail design and construction of a critical naval asset.
- Clear end date (2034) provides a defined project timeline.
Sector Analysis
This contract falls within the shipbuilding and repair sector, a vital component of national defense spending. Benchmarks for similar large naval construction projects are typically in the billions of dollars, reflecting the complexity and scale.
Small Business Impact
While the prime contractor is Marinette Marine Corporation, the contract may involve numerous subcontracts. Analysis is needed to determine the extent of small business participation in the supply chain for this major defense acquisition.
Oversight & Accountability
The Department of the Navy is responsible for oversight. Given the contract's length and complexity, robust oversight mechanisms will be crucial to manage performance, costs, and schedule adherence.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Long contract duration.
- Fixed Price Incentive contract type.
- Complexity of shipbuilding programs.
- Potential for schedule delays.
- Dependency on a single prime contractor for core construction.
Tags
ship-building-and-repairing, department-of-defense, wi, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $2.65 billion to MARINETTE MARINE CORPORATION. DETAIL DESIGN AND CONSTRUCTION OF FFG(X) GUIDED MISSILE FRIGATE
Who is the contractor on this award?
The obligated recipient is MARINETTE MARINE CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $2.65 billion.
What is the period of performance?
Start: 2020-04-30. End: 2034-05-31.
What are the key performance metrics tied to the incentive portion of the Fixed Price Incentive contract, and how will they be measured?
The key performance metrics for the incentive portion of the FPI contract are not detailed in the provided data. Typically, these metrics relate to schedule adherence, quality standards, and potentially specific technical performance thresholds for the FFG(X) frigate. The Navy will establish baseline targets, and the contractor will earn additional profit or incur penalties based on performance against these targets. Detailed contract clauses will outline the measurement and evaluation processes.
What are the primary risks associated with the long duration of this contract, and what mitigation strategies are in place?
The primary risks of a contract spanning over 13 years include potential cost inflation for labor and materials, technological obsolescence, and shifts in strategic requirements. Mitigation strategies often involve economic price adjustment clauses, phased funding, regular contract reviews, and incorporating flexibility for design updates. The Navy's program management office will be responsible for actively managing these risks throughout the contract lifecycle.
How does the FFG(X) program contribute to the overall modernization goals of the U.S. Navy, and what is its expected operational effectiveness?
The FFG(X) program is central to the Navy's goal of modernizing its fleet with more capable, multi-mission frigates. These vessels are intended to provide a balance of lethality, survivability, and affordability, complementing larger destroyers and cruisers. They are expected to enhance the Navy's ability to conduct a wide range of operations, including anti-submarine warfare, air defense, and surface warfare, thereby increasing overall fleet effectiveness and presence.
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: N0002419R2300
Offers Received: 4
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Parent Company: Segretariato Generale Della Presidenza Della Repubblica
Address: 1600 ELY ST, MARINETTE, WI, 54143
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $6,245,120,520
Exercised Options: $3,856,809,639
Current Obligation: $2,647,840,821
Actual Outlays: $24,138,876
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2020-04-30
Current End Date: 2034-05-31
Potential End Date: 2034-05-31 00:00:00
Last Modified: 2025-12-05
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