The U.S. Navy has awarded significant contracts to two major shipbuilders for the DDG 51 destroyers, enhancing the country's defense capabilities and ensuring steady work for the shipbuilding industry. Ingalls Shipbuilding, a division of Huntington Ingalls Industries (NYSE:HII), and Bath Iron Works, a subsidiary of General Dynamics (NYSE:NYSE:GD), are the recipients of these new contracts.
Ingalls Shipbuilding has clinched a follow yard support deal for technical management and coordinated production of the DDG 51 destroyers. Ben Barnett is at the helm of this agreement, which could reach a potential value of $185 million over four optional years. This contract underscores the adaptability of the shipbuilders and reinforces their role in bolstering national defense.
Simultaneously, Bath Iron Works has been awarded a cost-plus-fixed-fee support contract by the Naval Sea Systems Command for similar work on the DDG 51 destroyers. The contract starts with a base value of $58.9 million, with options that could extend its total worth to $418.5 million. The work under this contract is expected to be completed by November 2024 at their facilities in Maine.
Both contracts highlight the ongoing efforts to maintain and upgrade the United States' naval fleet in response to aerial, surface, and subsurface threats. Ingalls Shipbuilding's initial contract is valued at $26 million, with a potential increase to $185 million, and their work will continue through December 2024 in Pascagoula, Mississippi.
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