Two top Navy officials told Congress yesterday they are open to having the Block V Virginia-class submarine multiyear procurement (MYP) contract include the option to buy over the 10 planned boats.
Rep. Joe Courtney (D-Conn.), ranking member of the House Armed Services Seapower Subcommittee, told Secretary of the Navy Richard Spencer at a hearing that he sees mixed signals from the Navy of procurement of the Virginia-class attack submarine (SSN) just as Adm. Harry Harris, commander of U.S. Pacific Command, said he is only getting about half of the SSNs he needs for his requirements.
Courtney said the Navy is planning on a two Virginia-class submarine per year build rate for Block V submarines in the FY ’19 Future Years Defense program (FYDP). However, the 30-year shipbuilding plan said the industrial base has the capacity to build more boats in 2022 and 2023.
He compared this to the Block IV procurement that initially called for nine submarines but had an option to go higher and eventually procured 10 boats. Courtney characterized it as paying $17.6 billion in 2014 to buy 10 submarines for the price of nine.
Courtney asked if the Navy would use this kind of optional structure to open procurement up to 12 submarines.
Spencer said increased production is possible if the Navy has enough money.
“Yes, we have that option available to us, yes we have the option available to us and we’ve been talking to industry. Could we take that up to three boats a cycle? Yes. It’s there if in fact the resources are there,” Spencer replied.
“It is the managing of the resources. If in fact through reformation I can find another $2 billion within the Navy and I can reapply those funds internally to that program or any of the other programs, totally available,” he added.
Spencer was testifying at a hearing on the FY ’19 budget request and acquisition reform with the Army and Air Force secretaries.
Courtney later in the day pressed the same issue with assistant secretary of the Navy for research, development, and acquisition (ASN RD&A), James Geurts, during a subcommittee hearing on the submarine industrial base.
“As we look forward, I do believe there is capacity to get to three submarines per year in the off year of Columbia, three Virginia submarines a year. I think that’s the case,” Geurts said.
He said the Navy is in a sustainable serial production rate at two Virginia-class submarines per year “And so I’m comfortable saying there’s actually capacity there in the yard.”
The Columbia-class is the next generation ballistic missile submarine for the Navy and will eventually replace the Ohio-class boats.
He added the Navy will “absolutely look at putting the options in for submarines as they negotiate the upcoming multiyear procurement for Block V submarines.”
Geurts noted doing that has implications to economic order quantity requirements in the early years.
Prime contractor General Dynamics [GD] Electric Boat sent over their contract proposal last Friday “so the time is right for us to look at how to structure that and give the nation options” for additional submarines “if that’s what we choose to do,” he said.
Rear Adm. Michael Jabaley, Program Executive Officer (PEO) for Submarines, said at the second hearing that the service is very willing to work with Congress on adding alternatives for more submarines into the contractor negotiation process. He highlighted its importance to the supplier base.
“The most important thing I would say is an early signal for funding to allow us to leverage the economic order quantity buys for 12 ships instead of 10, if we were to add ships in ‘22 and ‘23, that signal for funding to the supplier base would be critically important.”