Navy Awards $160M Detail Design Contract for LCU 1700 Class Craft to Austal USA
Contract Overview
Contract Amount: $159,893,894 ($159.9M)
Contractor: Austal USA, LLC
Awarding Agency: Department of Defense
Start Date: 2022-09-14
End Date: 2027-03-16
Contract Duration: 1,644 days
Daily Burn Rate: $97.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST NO FEE
Sector: Defense
Official Description: DETAIL DESIGN OF LCU 1700 CLASS CRAFT
Place of Performance
Location: MOBILE, MOBILE County, ALABAMA, 36602
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $159.9 million to AUSTAL USA, LLC for work described as: DETAIL DESIGN OF LCU 1700 CLASS CRAFT Key points: 1. The contract value is $159.9 million. 2. This contract was not competed, raising questions about price discovery. 3. The primary risk lies in the lack of competitive bidding. 4. The sector is Ship Building and Repairing.
Value Assessment
Rating: questionable
The contract type is Cost No Fee, which offers limited incentive for cost control. Without competitive benchmarking, assessing the pricing's fairness is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition means taxpayers may not be receiving the best possible price for this detail design work.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The Navy receives specialized design services for its LCU 1700 class craft. Austal USA, LLC is the sole recipient of this significant contract.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Long performance period
Positive Signals
- Award to established contractor
- Clear project scope
Sector Analysis
The Ship Building and Repairing sector is capital-intensive and often involves complex, long-term contracts. Government contracts in this area can be substantial, with significant taxpayer investment.
Small Business Impact
This contract was awarded to Austal USA, LLC, a large business. There is no indication of small business participation in this specific award.
Oversight & Accountability
The Department of the Navy is responsible for overseeing this contract. The lack of competition warrants close scrutiny to ensure fair pricing and effective execution.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award
- Cost No Fee contract type
- Long contract duration
- Potential for cost overruns
- Lack of transparency in award justification
Tags
ship-building-and-repairing, department-of-defense, al, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $159.9 million to AUSTAL USA, LLC. DETAIL DESIGN OF LCU 1700 CLASS CRAFT
Who is the contractor on this award?
The obligated recipient is AUSTAL USA, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $159.9 million.
What is the period of performance?
Start: 2022-09-14. End: 2027-03-16.
What is the justification for not competing this detail design contract?
The justification for not competing this contract is not provided in the data. Typically, sole-source awards are made when only one responsible source can provide the required supplies or services. Further investigation into the specific circumstances surrounding this award is needed to understand the rationale.
What are the potential cost overruns associated with a Cost No Fee contract in this sector?
Cost No Fee contracts, while providing flexibility, can lead to cost overruns if not managed diligently. Without a fixed price or strong incentive for efficiency, the contractor may have less motivation to control expenses. The government bears the risk of cost overruns, making robust oversight crucial.
How does the lack of competition impact the long-term shipbuilding capabilities for the Navy?
A consistent pattern of sole-source awards can stifle competition within the shipbuilding industry, potentially leading to reduced innovation and higher prices over time. It may also limit the Navy's access to a broader range of capabilities and technologies available from other potential contractors.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST NO FEE (S)
Evaluated Preference: NONE
Contractor Details
Parent Company: Austal Limited
Address: 100 AUSTAL WAY, MOBILE, AL, 36602
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $350,048,118
Exercised Options: $159,914,763
Current Obligation: $159,893,894
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2022-09-14
Current End Date: 2027-03-16
Potential End Date: 2029-07-16 00:00:00
Last Modified: 2025-09-30
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