Navy awards $19.1M for USS Omaha LCS availability, with 3 bidders competing

Contract Overview

Contract Amount: $19,085,076 ($19.1M)

Contractor: Austal USA, LLC

Awarding Agency: Department of Defense

Start Date: 2025-08-01

End Date: 2026-03-31

Contract Duration: 242 days

Daily Burn Rate: $78.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CODE 420A, USS OMAHA (LCS-12) FISCAL YEAR 2025, SELECTED RESTRICTED AVAILABILITY, SSP: TPPC-LCS12-SWRMC25-CN01, DELIVERY ORDER

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92136

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $19.1 million to AUSTAL USA, LLC for work described as: CODE 420A, USS OMAHA (LCS-12) FISCAL YEAR 2025, SELECTED RESTRICTED AVAILABILITY, SSP: TPPC-LCS12-SWRMC25-CN01, DELIVERY ORDER Key points: 1. Contract focuses on ship repair and maintenance, crucial for fleet readiness. 2. Competition level suggests potential for competitive pricing, though specific benchmarks are needed. 3. Risk indicators include the short performance period and the specialized nature of LCS maintenance. 4. This award falls within the broader context of naval shipbuilding and repair spending. 5. The contract is positioned within the Defense sector, specifically naval operations.

Value Assessment

Rating: good

The award of $19.1 million for the USS Omaha (LCS-12) availability appears reasonable given the scope of restricted availability and repair services. Benchmarking against similar Littoral Combat Ship (LCS) maintenance contracts would provide a more precise value assessment. The firm-fixed-price structure helps control costs for the Navy. However, without detailed breakdowns of labor hours, material costs, and overhead, a definitive value-for-money judgment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with three bidders participating. This indicates a healthy level of market interest and suggests that the Navy sought to maximize competition to achieve favorable pricing and terms. The presence of multiple bidders generally leads to better price discovery and potentially lower costs for the government compared to sole-source or limited competition scenarios.

Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers as it likely resulted in a more competitive price for the required ship repair services, ensuring that taxpayer funds are used efficiently.

Public Impact

The primary beneficiaries are the U.S. Navy and its operational readiness, ensuring the USS Omaha is maintained. Services delivered include selected restricted availability, focusing on ship maintenance and repair. The geographic impact is centered in California, where the work will be performed. Workforce implications include employment for skilled trades in the shipbuilding and repair sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen repairs are required beyond the scope of the initial award.
Dependence on specialized skills and parts for LCS class ships, which can be a bottleneck.
The short performance period might limit the ability to fully address all potential long-term maintenance needs.

Positive Signals

Firm-fixed-price contract structure provides cost certainty for the Navy.
Awarded under full and open competition, indicating a competitive market.
The contract supports the readiness of a key naval asset, the USS Omaha.

Sector Analysis

The U.S. naval shipbuilding and repair sector is a critical component of national defense, involving complex engineering and skilled labor. Spending in this sector is substantial, driven by the need to maintain and modernize a large fleet. This contract for the USS Omaha's availability fits within the broader category of ship maintenance and repair services, which are essential for ensuring naval assets are operational. Comparable spending benchmarks would typically involve analyzing historical repair costs for similar vessel classes and the overall budget allocated to ship maintenance by the Department of the Navy.

Small Business Impact

This contract does not appear to have a small business set-aside. Given the specialized nature of naval ship repair, large prime contractors often perform the majority of the work, potentially subcontracting specific components or services. The impact on the small business ecosystem would depend on the subcontracting opportunities generated by AUSTAL USA, LLC, and whether they actively engage small businesses for specialized support.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting and program management offices. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services within the agreed budget. Transparency is generally maintained through contract award databases, though detailed performance metrics and cost breakdowns may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Littoral Combat Ship (LCS) Program
Naval Ship Maintenance and Repair
Defense Readiness Contracts
Shipbuilding and Repair Services

Risk Flags

Potential for scope creep or unforeseen issues impacting cost and schedule.
Dependence on specialized components and expertise for LCS class ships.
Contract performance risk associated with specialized maintenance tasks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.1 million to AUSTAL USA, LLC. CODE 420A, USS OMAHA (LCS-12) FISCAL YEAR 2025, SELECTED RESTRICTED AVAILABILITY, SSP: TPPC-LCS12-SWRMC25-CN01, DELIVERY ORDER

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 $19.1 million.

What is the period of performance?

Start: 2025-08-01. End: 2026-03-31.

What is the track record of AUSTAL USA, LLC in performing similar naval repair contracts?

AUSTAL USA, LLC has a significant track record in shipbuilding, particularly with the Littoral Combat Ship (LCS) program, having built several vessels in this class for the U.S. Navy. Their experience extends to post-delivery support and maintenance. While their primary expertise lies in new construction, they also undertake repair and availability contracts. Assessing their performance on past repair contracts, specifically those involving complex availability periods for LCS or similar vessels, would be crucial. This includes evaluating their adherence to schedule, budget, and quality standards on previous projects. Publicly available contract award data and performance reviews, if accessible, would provide further insight into their capabilities and reliability in executing such maintenance tasks.

How does the awarded amount compare to the estimated cost or budget for this availability period?

The awarded amount of $19.1 million for the USS Omaha's selected restricted availability needs to be compared against the Navy's internal cost estimates or allocated budget for this specific maintenance period. Without access to the Navy's pre-award estimates or the contract's funding breakdown, a direct comparison is difficult. However, the fact that it was awarded under full and open competition with three bidders suggests that the price achieved is likely competitive and within a reasonable range of what the market could bear. If the awarded amount is significantly lower than historical costs for similar availabilities or if it aligns closely with the bids received, it indicates efficient use of funds. Conversely, if it exceeds initial projections or historical spending without clear justification for increased scope or complexity, it might warrant further scrutiny.

What are the primary risks associated with this specific contract and the LCS class of vessels?

The primary risks associated with this contract include the inherent complexities of Littoral Combat Ship (LCS) maintenance, which has historically presented challenges due to the vessels' novel design and systems. Specific risks include potential for unforeseen technical issues discovered during the availability period that could lead to cost overruns or schedule delays, especially given the relatively short performance duration (242 days). There's also a risk related to the availability of specialized parts and trained personnel required for LCS maintenance. Furthermore, the 'selected restricted availability' nature implies a focused scope, meaning broader systemic issues might not be addressed, potentially leading to future maintenance needs. The contractor's performance risk is also a factor, though mitigated by the firm-fixed-price structure.

What is the historical spending pattern for USS Omaha (LCS-12) availability and maintenance?

Analyzing the historical spending pattern for USS Omaha (LCS-12) availability and maintenance is crucial for context. This would involve examining previous availability contracts awarded for this specific vessel, including their value, duration, scope of work, and the contractors involved. Comparing the current $19.1 million award against these historical figures can reveal trends in maintenance costs. For instance, if this award is significantly higher or lower than previous ones, it could indicate changes in the vessel's condition, the scope of work required, market rates for repair services, or the competitiveness of the bidding process. Understanding these historical patterns helps in assessing whether the current contract represents good value and if spending is consistent or escalating.

How does the competition level (3 bidders) impact the potential for cost savings for the taxpayer?

A competition level involving three bidders is generally considered healthy and is likely to have a positive impact on cost savings for the taxpayer. With multiple firms vying for the contract, each bidder is incentivized to offer a competitive price to secure the award. This competitive pressure helps drive down costs by forcing contractors to optimize their bids, potentially by improving efficiency, reducing profit margins, or leveraging economies of scale. The presence of three bidders suggests that the market is sufficiently robust to support multiple providers for this type of service, reducing the risk of a single contractor dominating the market and dictating prices. This scenario typically leads to better price discovery and ensures that the government is not overpaying for the required services.

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: N0002421R4443

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Austal Limited

Address: 100 ADDSCO RD, 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: $19,085,076

Exercised Options: $19,085,076

Current Obligation: $19,085,076

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002421D4443

IDV Type: IDC

Timeline