Huntington Ingalls Industries [HII] and VT Halter Marine, the two losing bidders for a recent Coast Guard contract to begin preliminary design work on its next major cutter, this week protested the awards, prompting the service to issue stop work orders to the winning bidders, Bollinger Shipyards, Eastern Shipbuilding Group, and General Dynamics [GD].
A Coast Guard spokesman told Defense Daily on Thursday in an email response to questions that all work on the Offshore Patrol Cutter (OPC) preliminary and contract design contracts has been paused pending resolution by the Government Accountability Office (GAO) of the protests.
HII and VT Halter Marine filed their separate protests on Feb. 24 and Feb. 25, respectively. The GAO has until June 4 to rule on HII’s protest and June 5 on VT Halter Marine’s.
The OPC, which will replace the Coast Guard’s fleet of existing medium-endurance cutters that are nearly 50 years old on average, is expected to be worth $10.5 billion for all 25 planned vessels. Current plans call for the Coast Guard to select one contractor in the fourth quarter of FY ’16 for detailed design and construction of the OPC.
If the GAO takes the allotted 100 days to resolve the protests and backs the Coast Guard’s original decision, and even if the agency’s decision requires the service to reopen the design competition, the chances are that the final contract for detailed design and construction will slip at least into FY ’17.
HII is the shipbuilder for the Coast Guard’s new high-endurance cutter, the National Security Cutter. The company’s loss for a P&CD award was a surprise. Bollinger is the prime contractor for the Coast Guard’s new short-range patrol craft, the Fast Response Cutter.
Mike Petters, HII’s president and CEO, limited his comments about the protest during the company’s fourth quarter earnings call Thursday, saying they wanted “a better understanding of how the decision was made so we can go learn from this.” Both HII and VT Halter Marine filed their protests after they were debriefed by the Coast Guard on the awards.
An HII spokeswoman provided a statement to Defense Daily that said the company “offered the Coast Guard a strong, fully compliant proposal to provide a very capable, cost effective offshore patrol cutter design and believe our protest has merit.”
VT Halter Marine did not respond to requests for a statement regarding their decision to protest.
The three design contracts awarded to Bollinger, Eastern Shipbuilding and GD are worth a combined $65 million.