Navy Awards Two Contracts to Build New Combat Ships

The New York Times reports that Lockheed Martin and Austal USA got nice Christmas gifts from the Navy:

The Navy on Wednesday awarded two companies contracts that could be worth a total of more than $7 billion to build 20 of its new littoral combat ships, splitting the purchase to obtain the vessels more quickly.

Navy officials said that if it exercises all of its options under the contracts, Lockheed Martin would assemble 10 of the coastal warships for $3.62 billion over six years and Austal USA, a unit of an Australian company, would build 10 for $3.52 billion.

The littoral combat ship (LCS) is the U.S. Navy’s response to China’s fast shallow-water naval vessels.   This new ship design highlights the changing nature of naval warfare and the geopolitical importance of the Asia Pacific region.

Austal USA also built the two Hawaii Superferry ships, which were prototypes for the Joint High Speed Vessel (JHSV), a major contract that Austal USA recently won from the US Navy.  Activists opposed to the Hawaii Superferry pointed out that the ferry was just a front for these larger military plans.  At the time, these theories were ridiculed by the media and politicians.  But it seem now that the activists were right. And Austal is laughing all the way to the bank.