Navy awards $67.8M contract for USS Vicksburg repair, highlighting shipbuilding and repair sector activity

Contract Overview

Contract Amount: $67,786,128 ($67.8M)

Contractor: BAE Systems Maritime Solutions Norfolk Inc.

Awarding Agency: Department of Defense

Start Date: 2018-02-12

End Date: 2020-01-19

Contract Duration: 706 days

Daily Burn Rate: $96.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::CT::IGF::USS VICKSBURG (CG 69) SSRA2

Place of Performance

Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23523

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $67.8 million to BAE SYSTEMS MARITIME SOLUTIONS NORFOLK INC. for work described as: IGF::CT::IGF::USS VICKSBURG (CG 69) SSRA2 Key points: 1. Contract addresses critical maintenance needs for a naval asset. 2. BAE Systems Maritime Solutions secured the award, indicating established capabilities in naval repair. 3. The firm-fixed-price structure aims to control costs for the government. 4. This award falls within the broader context of naval readiness and fleet modernization. 5. The duration of the contract suggests a significant scope of work. 6. The contract value is substantial within the shipbuilding and repair sub-sector.

Value Assessment

Rating: good

The contract value of $67.8 million for the USS Vicksburg (CG 69) Ship Service Repair Availability (SSRA2) appears reasonable given the scope of work typically involved in major naval vessel maintenance. While direct comparisons are difficult without detailed work breakdown structures, BAE Systems Maritime Solutions is a known entity in this specialized field. The firm-fixed-price contract type suggests an effort to establish a clear cost ceiling, which is a positive indicator for value. Benchmarking against similar availability contracts for cruisers would provide a more precise assessment of value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified contractors had the opportunity to bid. The presence of two bids suggests a competitive environment, though the specific number of bidders can vary significantly for complex naval repair contracts. Full and open competition is generally expected to drive better pricing and terms for the government by allowing a wide range of capable firms to participate.

Taxpayer Impact: Full and open competition increases the likelihood that the Navy received the best possible pricing and technical solutions, maximizing the value of taxpayer dollars spent on essential fleet maintenance.

Public Impact

Naval personnel and the operational readiness of the fleet benefit from the maintenance and repair of the USS Vicksburg. The contract ensures the continued serviceability of a key asset in the U.S. Navy's cruiser fleet. The work is likely to be performed in Norfolk, Virginia, supporting the regional maritime industrial base. Skilled labor in shipbuilding and repair trades will be engaged, contributing to the maritime workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise during repair, despite the fixed-price nature.
Dependence on a single contractor for critical repair services could pose risks if performance falters.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to an established maritime solutions provider suggests a higher likelihood of successful execution.
Full and open competition indicates a robust bidding process.

Sector Analysis

This contract falls within the shipbuilding and repair sector, a critical component of the defense industrial base. This sector is characterized by high technical complexity, specialized labor, and significant capital investment. The U.S. Navy is a major customer, with substantial annual spending on vessel maintenance, modernization, and new construction. Comparable spending benchmarks would involve other availability contracts for naval vessels of similar size and complexity, often running into tens or hundreds of millions of dollars.

Small Business Impact

The contract data indicates that this was not a small business set-aside. Given the specialized nature and scale of naval vessel repair, large, established contractors like BAE Systems Maritime Solutions are typically best positioned to compete. There is no explicit information on subcontracting plans for small businesses within this award, but it is common practice for prime contractors in this sector to utilize small business subcontractors for specific components or services.

Oversight & Accountability

The Department of the Navy's contracting and oversight mechanisms are designed to ensure proper execution. Oversight would involve contract officers, technical representatives, and quality assurance personnel monitoring progress, adherence to specifications, and cost controls. Transparency is generally maintained through contract award databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the contract performance or award process.

Related Government Programs

Naval Ship Maintenance Contracts
Shipbuilding and Repair Services
Fleet Readiness Programs
Department of Defense Ship Repair

Risk Flags

Potential for schedule delays
Risk of unforeseen technical issues
Dependence on contractor performance

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $67.8 million to BAE SYSTEMS MARITIME SOLUTIONS NORFOLK INC.. IGF::CT::IGF::USS VICKSBURG (CG 69) SSRA2

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS MARITIME SOLUTIONS NORFOLK INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $67.8 million.

What is the period of performance?

Start: 2018-02-12. End: 2020-01-19.

What is the historical spending pattern for USS Vicksburg availability contracts?

Analyzing historical spending for USS Vicksburg availability contracts requires access to detailed procurement data over multiple years. Typically, major naval vessels undergo periodic availabilities for maintenance and upgrades. The frequency and cost of these availabilities can fluctuate based on the ship's operational tempo, age, and the specific modernization requirements. Without specific historical data for this vessel, it's difficult to establish a precise pattern. However, it is common for such contracts to be awarded every few years, with costs varying significantly based on the scope of work, from minor repairs to extensive overhauls. The current $67.8 million award should be viewed in the context of previous availabilities, if available, to assess trends in cost and duration.

How does the awarded price compare to similar repair contracts for Ticonderoga-class cruisers?

Directly comparing the $67.8 million award for the USS Vicksburg (CG 69) to similar repair contracts for Ticonderoga-class cruisers requires access to a database of comparable procurements with detailed scope of work. Factors such as the specific availability type (e.g., Docking Phased Maintenance Availability, Ship Service Repair Availability), the extent of modernization, shipyard labor rates, and the specific shipyard performing the work can cause significant price variations. However, this value falls within a typical range for major availabilities of cruisers, which are complex vessels requiring extensive maintenance. A comprehensive benchmark would involve analyzing multiple recent availabilities for this class of ship to identify a median or average cost for similar work scopes.

What is BAE Systems Maritime Solutions' track record with similar naval repair contracts?

BAE Systems Maritime Solutions is a well-established and experienced contractor within the U.S. defense industrial base, particularly in naval shipbuilding and repair. They have a history of performing complex maintenance, modernization, and new construction for various U.S. Navy vessels, including cruisers, destroyers, and aircraft carriers. Their track record typically involves successfully completing large-scale projects, often under challenging conditions and tight deadlines. Performance reviews and past performance evaluations, which are part of the federal procurement process, would provide more granular insights into their specific success rates, quality of work, and adherence to schedule and budget on previous, similar contracts. Their significant presence in Norfolk, a major naval hub, further indicates their established capabilities and infrastructure for such work.

What are the primary risks associated with this type of naval repair contract?

The primary risks associated with this type of naval repair contract include unforeseen technical challenges discovered during the repair process, which can lead to scope creep and potential cost increases, even under a firm-fixed-price contract if not managed carefully through change orders. Schedule delays are another significant risk, stemming from issues like parts availability, labor shortages, or unexpected discoveries within the vessel's systems. Performance risk also exists, where the quality of the repair work might not meet the stringent Navy standards, requiring rework. Furthermore, the concentration of work with a single prime contractor can pose a risk if that contractor experiences financial instability or significant operational disruptions. The government also faces the risk of not achieving the full intended operational availability of the vessel if the repairs are not completed effectively and on time.

How does the duration of the contract (706 days) align with typical repair cycles for this class of ship?

A contract duration of 706 days (approximately 23 months) for a Ship Service Repair Availability (SSRA2) for a Ticonderoga-class cruiser like the USS Vicksburg (CG 69) is substantial and aligns with the complexity and scope of major maintenance availabilities. These periods often encompass extensive inspections, hull work, machinery overhauls, system upgrades, and habitability improvements. The duration reflects the need for detailed planning, execution, and testing of numerous systems. Shorter availabilities typically focus on more limited maintenance tasks. The 706-day period suggests a comprehensive scope of work aimed at extending the service life and enhancing the operational capabilities of the vessel, which is consistent with the lifecycle management of major naval assets.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › NON-NUCLEAR SHIP REPAIR

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002415R4405

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC

Address: 750 W BERKLEY AVE, NORFOLK, VA, 23523

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

Financial Breakdown

Contract Ceiling: $67,786,128

Exercised Options: $67,786,128

Current Obligation: $67,786,128

Actual Outlays: $3,225,012

Subaward Activity

Number of Subawards: 112

Total Subaward Amount: $20,581,010

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002416D4406

IDV Type: IDC

Timeline