BAE Systems will not oppose the Navy’s award last month to Lockheed Martin [LMT] for the production of the Mk 41 ship-based missile vertical launch system, the company said Monday.
“We have concluded our review of the Navy’s recent vertical launch system mechanical and electronic award decisions and have elected not to protest,” BAE said in a statement.
BAE has received an explanation from the Navy before choosing against lodging a protest with the Government Accountability Office. A protest likely would have prompted the Navy to halt work on the new contract until the dispute gets resolved.
The Navy announced Dec. 12 that it had awarded the mechanical and electrical components of the VLS to Lockheed Martin. The Navy competed both segments of the system separately.
BAE had been the prime contractor for the construction of the VLS modules since 2010, while Lockheed Martin was responsible for the electrical side. But the latter company snatched up both in the latest award that has an initial value $235 million and could climb to $356 million if all of the options are exercised on work through 2022.
Nearly 70 percent of the VLS production under the award is for the U.S. Navy, while 26 percent is for systems going to Saudi Arabia and about four percent for Norway.
The VLS is installed on Navy cruisers and destroyers and launches a vast array of missiles, including the Tomahawk cruise missile for land attack, multiple types of the Standard Missile for air-theater and ballistic missile defense, and the Anti-Submarine ROCket, or ASROC, torpedo.
Lockheed Martin had been building the VLS since 1993 with BAE as a subcontractor until the Navy began separately contracting the major component work in 2010.
Joe North, Lockheed Martin’s vice president for littoral systems at its mission systems and training unit, told reporters Monday that the company is ready to resume work on the mechanical modules segments at a facility in Baltimore, where they were previously made.
“It’s just a matter of re-establishing that production line,” North said.