Navy Awards $7.4M Contract for USNS Cesar Chavez Regular Overhaul to HD Hyundai Heavy Industries
Contract Overview
Contract Amount: $7,410,900 ($7.4M)
Contractor: HD Hyundai Heavy Industries CO.,Ltd.
Awarding Agency: Department of Defense
Start Date: 2025-12-11
End Date: 2026-03-19
Contract Duration: 98 days
Daily Burn Rate: $75.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: USNS CESAR CHAVEZ REGULAR OVERHAUL 2026
Plain-Language Summary
Department of Defense obligated $7.4 million to HD HYUNDAI HEAVY INDUSTRIES CO.,LTD. for work described as: USNS CESAR CHAVEZ REGULAR OVERHAUL 2026 Key points: 1. Contract awarded to HD Hyundai Heavy Industries for a regular overhaul of the USNS Cesar Chavez. 2. The contract value is $7.41 million, with a duration of 98 days. 3. This is a firm-fixed-price contract, indicating a defined scope and cost. 4. The award falls under the Ship Building and Repairing sector, with NAICS code 336611.
Value Assessment
Rating: good
The contract value of $7.41 million for a regular overhaul appears reasonable given the specialized nature of naval vessel maintenance. Benchmarking against similar overhauls for comparable vessels would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. This method is expected to yield fair market prices and encourage efficient service delivery.
Taxpayer Impact: The competitive award process aims to ensure taxpayer funds are used efficiently for essential naval maintenance.
Public Impact
Ensures the operational readiness of a key naval asset, the USNS Cesar Chavez. Supports the maritime industrial base through a significant contract award. Maintains critical infrastructure for national defense and logistical support.
Waste & Efficiency Indicators
Waste Risk Score: 75 / 10
Positive Signals
- Full and open competition utilized.
- Firm fixed price contract type.
- Clear definition of work scope for overhaul.
Sector Analysis
The Ship Building and Repairing sector is critical for maintaining the U.S. Navy's fleet. Spending in this area is subject to rigorous oversight due to the high cost and strategic importance of naval vessels.
Small Business Impact
The data does not indicate any specific provisions or awards made to small businesses for this particular contract. Further analysis would be needed to determine if small businesses were involved as subcontractors.
Oversight & Accountability
The contract is managed by the Department of the Navy, a component of the Department of Defense, which typically has robust oversight mechanisms for major vessel maintenance contracts.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for scope creep if overhaul tasks are not precisely defined.
- Dependence on a single contractor for critical maintenance.
- Geopolitical factors could impact supply chain or labor availability.
Tags
ship-building-and-repairing, department-of-defense, definitive-contract, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $7.4 million to HD HYUNDAI HEAVY INDUSTRIES CO.,LTD.. USNS CESAR CHAVEZ REGULAR OVERHAUL 2026
Who is the contractor on this award?
The obligated recipient is HD HYUNDAI HEAVY INDUSTRIES CO.,LTD..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $7.4 million.
What is the period of performance?
Start: 2025-12-11. End: 2026-03-19.
What is the historical cost trend for similar regular overhauls on naval vessels of comparable size and complexity?
Historical data on similar overhauls is crucial for validating the current $7.41 million award. Analyzing past contracts for vessels like the USNS Cesar Chavez, considering inflation and scope variations, would establish a reliable benchmark. This comparison helps determine if the current price reflects market efficiency or potential overspending, ensuring optimal use of taxpayer funds.
What specific maintenance and repair tasks are included in this 'regular overhaul' to justify the contract value and duration?
A detailed breakdown of the overhaul's scope, including hull maintenance, propulsion system servicing, equipment upgrades, and safety inspections, is necessary. Understanding the specific tasks allows for a more accurate assessment of the $7.41 million cost and the 98-day timeline. This transparency is vital for evaluating the contract's value and ensuring all critical maintenance needs are met effectively.
How does the performance of HD Hyundai Heavy Industries on previous naval contracts compare to industry standards?
Evaluating HD Hyundai Heavy Industries' past performance on similar naval contracts provides insight into their reliability, quality of work, and adherence to schedules and budgets. Benchmarking their track record against industry peers helps assess the risk associated with this contract. Positive past performance suggests a lower risk of delays or cost overruns, contributing to the overall effectiveness of the award.
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: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: HD Hyundai Heavy Industries CO. Ltd.
Address: 1000, BANGEOJINSUNHWANDO-RO DONG-GU, ULSAN
Business Categories: Category Business, Foreign Owned, International Organization, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $7,500,000
Exercised Options: $7,410,900
Current Obligation: $7,410,900
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2025-12-11
Current End Date: 2026-03-19
Potential End Date: 2026-04-03 00:00:00
Last Modified: 2026-01-08
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