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GAO-11-249R 1 (2010-12-08)

handle is hein.gao/gaobaanvt0001 and id is 1 raw text is: i ~GA 0 Acouita bility Integrity * Reliability United States Government Accountability Office Washington, DC 20548 December 8, 2010 Congressional Committees Subject: Navy's Proposed Dual Award Acquisition Strategy for the Littoral Combat Ship Program The Navy's Littoral Combat Ship (LCS) is envisioned as a vessel able to be reconfigured to meet three different mission areas: mine countermeasures, surface warfare, and antisubmarine warfare. Its design concept consists of two distinct parts-the ship itself (seaframe) and the mission package it carries and deploys. The Navy is procuring the first four ships in two different designs from shipbuilding teams led by Lockheed Martin and General Dynamics, which currently build their designs at Marinette Marine and Austal USA shipyards, respectively. Prior to September 2009, the Navy planned to continue building the class using both ship designs. This strategy changed following unsuccessful contract negotiations that same year for fiscal year 2010 funded seaframes-an outcome attributable to industry proposals priced significantly above Navy expectations. In September 2009, the Navy announced that in an effort to improve affordability, it was revising the LCS program's acquisition strategy and would select one seaframe design before awarding contracts for any additional ships.' Following approval of this strategy in January 2010, the Navy issued a new solicitation-intended to lead to a downselect-for fiscal year 2010 seaframes. In support of this strategy, Congress authorized the Navy to procure up to 10 seaframes and 15 LCS ship control and weapon systems. The Navy planned to have a second competition in 2012 and provide five of the ship control and weapon systems to the winning contractor, who would construct up to 5 ships of the same design and install the systems. However, in November 2010, following receipt of new industry proposals for the fiscal year 2010 seaframes, the Navy proposed to change its acquisition strategy back to awarding new construction contracts to both industry teams.2 According to the Navy, in order to execute this proposed dual 10- ship award, congressional authorization is required. If approved, the Navy's authorization would increase from 10 ships to 20 ships-including ship control and 'The decision to select a single ship design is referred to as the downselect. 2 In response to the Navy's September 2009 LCS acquisition strategy change, General Dynamics and Austal USA revoked their teaming arrangement for future seaframes, in turn allowing the General Dynamics Bath Iron Works shipyard to compete for selection as the planned potential second source of the winning design. Austal USA and Lockheed Martin are the prime contractors competing for the current 10-ship program. GAO-11-249R LCS Proposed Acquisition Strategy

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