Navy adds $1B to unconventional effort to boost sub production

The U.S. military has added nearly $1 billion to its unconventional efforts to use third parties to kick the nation’s submarine-building industry into a higher gear.

On Tuesday, the Navy announced an up-to-$980.7 million contract to BlueForge Alliance, a two-year-old Texas-based nonprofit firm, for “planning, resourcing, coordinating, and uplifting the U.S. Submarine Industrial Base and Foreign Military Sales requirements.”

The non-competitive, sole-source award doubles the roughly $500 million in Navy funding already given to BlueForge, best known for its splashy BuildSubmarines.com campaign to recruit shipyard workers. It also follows an up-to-$2.4 billion Defense Department contract awarded in July to consulting firm Deloitte to help the nation’s two sub-building shipyards “reach and sustain a programmed production rate of 1+2 submarines per year.” 

All this brings Pentagon spending on third-party assistance to its submarine suppliers to a potential total of nearly $4 billion. 

The Navy, which is planning to buy just one attack submarine in fiscal 2025, is struggling to restore annual production to two attack boats plus one Columbia-class ballistic missile submarine. The nation’s ability to maintain and repair its subs is in even worse shape, with a three-year backlog for major work. And the AUKUS deal to supply submarines to Australia only adds extra pressure. 

The new contract to BlueForge aims to extend “critical efforts to strengthen and expand the submarine industrial base,” including helping to diversify and strengthen supply chains and to attract, train, and retain more workers for shipyards and their suppliers, a Navy spokesperson said in a Thursday statement.

It is also meant to improve U.S. defense manufacturing writ large by “scaling” 3D-printing, robotics, automation, and other technologies, the spokesperson said.

The contract was awarded to BlueForge without competition because there was “only one responsible source and no other supplies or services will satisfy agency requirements,” the Pentagon announcement said.

The Navy will award BlueForge just over half of the contract’s value—$503.1 million—in fiscal 2024 funds from “shipbuilding and conversion (Navy)” and foreign partners. Most of those funds are expected to go to the U.S. submarine industrial base, USNI News reported. 

The job is the first Navy prime contract awarded directly to BlueForge, a company spokesperson said; its earlier work with the submarine industry was through a subcontract from General Dynamics Electric Boat, one of the nation’s two sub-building shipyards.

Under the contract, BlueForge will try to help the shipyards and their 16,000 suppliers increase efficiency and cut costs, company officials said. 

“Mission success depends on the critical role we play as a non-profit, unbiased integrator,” Rob Gorham, BlueForge’s co-founder and co-chief executive officer, said in a Thursday statement to Defense One. “We are actively convening a nexus of public-private partnerships necessary to catalyze the industrial base for the Navy’s next horizon of critical missions and are implementing a whole of nation approach to maximize impact through speed and scale.”

A BlueForge spokesperson said the company has developed a process to guide and measure effects of funding, including investment decision models, data integration and analysis. It is tracking talent attraction, hires and retention and delivery timelines for critical parts, such as major mechanical parts, valves and fittings, electrical parts, and raw materials. 

On the technology side, the company is “measuring positive schedule impacts to the Navy's submarine construction goals created by the infusion of advanced manufacturing technologies such as additive manufacturing, robotics, automation, and enhanced non-destructive testing capabilities,” the spokesperson said.

Rep. Joe Courtney, D-Conn., pronounced himself delighted at the news. 

“​​This contract award is another clear example of the tremendous partnership between the Navy, shipbuilders, and BlueForge to increase capacity in the submarine industrial base. With approval from the Navy, BlueForge is executing projects across the country to stand up workforce training pipelines, invest in supply chain companies, and develop innovative technologies to drive expansion of the shipbuilding sector,” Courtney said in a Thursday statement.