Three major defense companies–Boeing [BA], Lockheed Martin [LMT] and Raytheon [RTN]–submitted bids yesterday in the Navy’s competition for the next contract to modernize the Aegis Combat System.
The Navy is expected to award the Aegis Combat System Engineering Agent (CSEA) sometime in late 2012. The award could amount to billions of dollars over the next 10 years to upgrade Aegis, which is employed on Arleigh Burke-class (DDG-51) destroyers and Ticonderoga-class (CG-47) cruisers.
Lockheed Martin has been the sole contractor for Aegis, which has been in service for decades, since it acquired Martin Marietta in 1995. The Navy, under pressure to save money and avoid sole source contracting, decided to reopen the contract to a competitive process. The advanced combat command and control system harnesses radar tracking to guide weapons to airborne targets.
Losing the competition would be a major blow to Lockheed Martin and its Moorestown, N. J., facility that anchors its Aegis team. Lockheed Martin is confident its experience with Aegis will allow it to hold onto the contract, and has publicly welcomed the competition as added incentive to evaluate and maximize the performance and affordability of its system. The company noted it has evolved the system 15 times to meet a wide array of dynamic and evolving threats over four decades.
“I am looking forward to the competition …,” Carmen Valentino, the company’s vice president who headed up the proposal team, said in an interview after the bid was submitted. “We believe our offering is superior and that will come out in the results.”
Raytheon, Lockheed Martin’s traditional rival in the area of combat systems, said it has taken an “innovative approach” designed to meet the emerging threats facing the Navy. While Boeing has submitted a separate bid as a prime contractor, industry sources said the company is also a subcontractor on Raytheon’s team.
“We have delivered a competitive proposal to the U.S. Navy,” a Raytheon spokesperson said. “We believe we have effectively presented our extensive capabilities, proven performance and qualifications to serve as the Navy’s CSEA for Aegis-equipped ships.”
Boeing, which only recently signaled its intention to bid, touted its role in the integration of naval combat and missile defense systems and its work on the P-8 Poseidon program.
“Boeing has a long history of modernizing existing systems, enhancing their capability with the latest tools and technology, and delivering flexible, low-cost, high-performance end products. That kind of expertise will be essential to bringing the Aegis system’s capabilities to the next level,” Greg Hyslop, the company’s vice president and general manager for strategic missile and defense systems, said in a statement.
The submission deadline was moved back from November to yesterday afternoon after Naval Sea Systems Command (NAVSEA) modified the request for proposals to ask the bidding firms to identify challenges that could arise with integrating the Air and Missile Defense Radar (AMDR) (Defense Daily, Oct. 24, 2011).
AMDR is intended to be the next generation radar for multiple classes of surface combatants to detect and engage missiles and advanced air threats. The Navy in September 2010 awarded two-year contracts to Lockheed Martin, Northrop Grumman [NOC] and Raytheon for the technology demonstration phase of AMDR (Defense Daily, Oct. 11, 2010).
Lockheed Martin also builds Aegis Ballistic Missile Defense, the cornerstone of the Navy’s sea-based BMD program, under a separate contract with the Pentagon’s Missile Defense Agency.
The Navy plans to begin upgrading to the Multi-Mission Signal Processor (MMSP) on ships next year, which will effectively merge functioning of the combat system with the missile defense version, under a current contract with MDA.