The U.S. Government Accountability Office (GAO) recommended April 18 that the Navy delay a key contract award for the Future Frigate by a year to ensure it has enough information on the vessel’s cost and capabilities.
While the Navy currently plans to award the lead-ship contract in fiscal year 2018, the GAO wrote in a new report that an FY 2019 award would make more sense due to several unresolved factors. The program will not have a formal, independent cost estimate until FY 2018, and it will not begin key detail design activities until late FY 2018. In addition, “significant unknowns” about the ship’s operational performance remain because the frigate’s precursor, the Littoral Combat Ship (LCS), still must undergo testing that is relevant to the frigate, the GAO said.
The GAO added that there is no “industrial base imperative” to award the contract in FY 2018 because the competing shipyards have enough LCS work to sustain them into FY 2021. Lockheed Martin [LMT] and Austal USA are the prime contractors for the LCS Freedom and Independence variants, respectively.
Delaying the frigate award to FY 2019 “would provide time to complete realistic cost estimates, build detail design knowledge, and make significant progress in understanding the operational capability and limitations of LCS, upon which the frigate design will be based,” the GAO wrote.
The Navy plans to buy 12 frigates after completing construction of 28 LCS’s. The frigates could cost a total of $9 billion, based on early budget estimates, the GAO said.
In response to a draft of the report, the Department of Defense acknowledged that an FY 2018 contract award includes “some risks,” but it insisted that “the Navy’s approach offers an acceptable tradeoff between technical and affordability risks.” DoD said it will scrutinize the frigate’s cost and combat systems before the Navy releases a request for proposals to shipbuilders.
The report’s release came eight days after the Navy indicated it is studying the feasibility of incorporating additional capabilities, including air defense and enhanced survivability, into the frigate (Defense Daily, April 10, 2017). The study, which is slated for completion later this spring, is also exploring hull forms besides those used for LCS. The results are expected to influence deliberations on the Navy’s FY 2018 budget request.