The U.S. Navy plans to award the design contract for the Ohio replacement submarine to prime contractor General Dynamics [GD] Electric Boat by October, a service official said July 8.
The Navy received Electric Boat’s proposal for the new ballistic missile submarine in May, and “we are in a very intensive review cycle right now, exchanging questions and answers between the government and the contractor,” said Rear Adm. Michael Jabaley, the Navy’s program executive officer for submarines. “We’ll go into hard-core negotiations later this summer. My goal is to award the contract by the beginning of the fiscal year, Oct. 1.”
The Navy expects that identifying ways to control future costs will be a major part the negotiations. “We will aim to strongly incentivize cost reduction as a part of this detail design contract,” Jabaley told reporters after speaking at the Center for Strategic and International Studies (CSIS) in Washington, D.C. “The time to reduce the cost of construction and ownership of the platform is as early in design as you can get it.”
Later this summer, the Navy is slated to go before a Defense Acquisition Board to formally ask the Pentagon to green-light the program. To support that process, the Navy is updating the program’s cost estimates. In 2014, the Navy calculated that designing the submarine and preparing construction yards would cost $17.4 billion, and that building “follow” ships two through 12 would cost an average of $5.2 billion. “The lead ship is always different,” the admiral said.
Asked whether the Navy can award the Electric Boat contract if Congress and the Obama administration fail to reach agreement on a fiscal year 2017 defense authorization bill, Jabaley demurred. “There are a variety of ways to do it, but I’m not going to answer that right now,” he said.
