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Lockheed Beats Out Challengers, Retains Aegis License

New Littoral Combat Ships Ordered

Mar. 4, 2013 - 06:25PM   |  
By CHRISTOPHER P. CAVAS   |   Comments
Lockheed Martin has won a competition to continue as prime contractor for the Aegis combat system through 2018. All the Navy's major surface combatants, like the destroyers Kidd, Dewey and Pinckney, are fitted with the system.
Lockheed Martin has won a competition to continue as prime contractor for the Aegis combat system through 2018. All the Navy's major surface combatants, like the destroyers Kidd, Dewey and Pinckney, are fitted with the system. (MC3 Benjamin Crossley / U.S. Navy)
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WASHINGTON — Lockheed Martin has withstood a challenge from Boeing and Raytheon to take over management of the U.S. Navy’s vaunted Aegis combat system, and was rewarded Monday with a $100 million contract as the Aegis Combat System Engineering Agent (CSEA).

The award climaxed the first major competition for the Aegis system, which was developed by the Navy and Lockheed in the 1970s and managed by the company ever since.

Raytheon and Boeing also submitted CSEA bids late in 2011, hoping to gain one of the keys to continue development of one of the most significant combat systems ever developed.

Aegis was initially developed to handle area air defense of carrier strike groups against massed Soviet bomber and missile attacks. It has since been expanded as the basis for the U.S. Navy’s side of the ballistic missile defense picture and — under orders from the Navy — Lockheed has converted most of the system’s programming to “open architecture,” allowing competitive bidding for the now non-proprietary system.

“The CSEA contract is a prime example of the Navy's commitment to competition and providing cost effective solutions to the taxpayers,” Rear Adm. Joe Horn, program executive officer for Integrated Weapons Systems (PEO IWS) at the Naval Sea System Command, said in a statement.

“By openly competing the Aegis CSEA contract, the Navy will benefit from improved systems at a lower cost, which is absolutely critical in light of our budget challenges.”

All of the Navy’s cruisers and destroyers are fitted with the Aegis system, and current plans call for all near-term new-build destroyers to be designed with the system.

The CSEA contract runs through May 2018. Another competition will be run by the Navy to determine the winner of a follow-on award.

A separate competition is under way to develop a new Air Missile Defense Radar (AMDR), a successor to the Lockheed SPY-1 phased-array radars carried by all current Aegis ships. Lockheed, Raytheon and Northrop Grumman are the contenders, with a contract announcement expected later this year.

The full NAVSEA statement on the contract award is copied below.

More Littoral Combat Ships Ordered

Also on Monday, the Navy announced contract awards for four more Littoral Combat Ships (LCS), two each to Lockheed Martin and Austal USA. All the ships are included in the 2013 defense budget request.

Lockheed received a $696.6 million contract for its two Freedom-class ships, numbered LCS 13 and 15, which will be built at Fincantieri Marinette Marine’s shipyard in Marinette, Wisc.

Austal USA’s pair, LCS 14 and 16 of the Independence class, will be built under a $681.7 million award at its shipyard in Mobile, Ala.

The Navy has yet to announce names for the new ships, which are expected to be delivered by 2018.

The awards come almost a year after the last two LCS contract announcements, on March 16, 2012.

Sean Stackley, the Navy’s top acquisition official, touted the competition between the two shipbuilders as a key to “tremendous savings” in buying the ships.

“This again demonstrates our efforts to bring stability to industry, from the shipyards to the small businesses that support these ships' construction, in a period of great uncertainty,” Stackley said in a statement.

Statement Issued by the Naval Sea Systems on the Aegis CSEA award:

NAVSEA PRESS RELEASE: Aegis Combat System Engineering Agent Contract Award Announced

Aegis Combat System Engineering Agent Contract Award Announced

WASHINGTON — Today the Navy is awarding Lockheed Martin a $100,685,094 contract for Aegis Combat System Engineering Agent (CSEA) efforts. This will be the first time Aegis CSEA efforts have been competitively procured in more than 40 years.

As the prime contractor for Aegis CSEA efforts, Lockheed Martin will evolve and maintain the Aegis Weapon System (AWS) and Aegis Combat System (ACS) for CG 47 class cruisers, DDG 51 class destroyers and possible future surface combatant ship classes.

Under the contract, Lockheed Martin will develop, integrate and test future Advanced Capability Builds — computer program baselines — and technology insertions, develop engineering products to support ship integration, support developmental and operational testing, develop training and logistics products and provide field technical support for designated combat systems baselines. Lockheed Martin will also maintain legacy systems.

“The CSEA contract is a prime example of the Navy's commitment to competition and providing cost effective solutions to the taxpayers,” said Rear Adm. Joe Horn, program executive officer for Integrated Weapons Systems (PEO IWS). “By openly competing the Aegis CSEA contract, the Navy will benefit from improved systems at a lower cost, which is absolutely critical in light of our budget challenges.”

The systems engineering, development and integration work under this contract will begin with Advanced Capability Build (ACB) 16 and technology insertion 16, and continue with a future ACB through the period of performance of the contract. Each ACB will bring additional capabilities that will further enable the Aegis Weapon System to address emerging anti-air warfare and ballistic missile defense threats. The ACBs will also bring the integration of additional sensors further enhancing the ability to address threats in an integrated air and missile defense environment.

This contract was competitively procured, with three proposals received. The base contract award performance is expected to be completed by May 2018, and the Navy is planning to conduct a follow-on competitive solicitation for the development of future ACBs.

PEO IWS, an affiliated program executive office of the Naval Sea Systems Command, manages surface ship and submarine combat technologies and systems, and coordinates Navy enterprise solutions across ship platforms.

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