U.S. Navy award to Ingalls totals $2.8 billion for new Aegis destroyers

March 6, 1998 -- Ingalls Shipbuilding has been awarded a contract with a potential value of approximately $2.8 billion to build eight additional DDG 51 Class Aegis guided missile destroyers for the United States Navy.

The contract announced today includes the immediate award of six ships, and contract options for a seventh and eighth ship. The contract is part of a multiyear procurement plan under which the Navy is awarding multiple ships under a single contract.

"The construction of Aegis destroyers continues as a major, strategic element of Ingalls' present and future business base," said Jerry St. Pe', Senior Vice President of Litton Industries and President of Ingalls Shipbuilding. "The multiyear ship award brings important stability to the Aegis destroyer program, and to our Company's future business planning process. Efficiency in building these destroyers, an area in which Ingalls has excelled, provides the means to build these ships in the numbers necessary to fully support the Navy's missions," St. Pe' said.

The Navy plans to order a total of 57 ships in the DDG 51 program. Today's announcement brings the total awarded thus far to 52, with the remaining five ships planned for award in the years 2002 and 2003. Based on the eight-ship award to Ingalls today, the Company will have received contracts for 25 Aegis destroyers, with 11 of these ships already delivered -- each ahead of schedule and under budget.

"Delivery dates on the eight new ships extend into 2006, and will keep our experienced, seasoned destroyer builders engaged into the 21st century," St. Pe' said. He added that Ingalls' workforce is currently at 10,800, and is expected to grow by several hundred over the next year.

Much of the equipment for the ships awarded today is already on order under advance procurement contracts which allowed Ingalls to place orders for equipment for the ships included in the multiyear plan. Last May, Ingalls was awarded a $164.5 million contract to begin this advance procurement, which permitted the shipyard and its suppliers to plan for multiship procurement, saving the taxpayers millions of dollars.

The Navy's Aegis Fleet provides primary protection for the Navy's battle forces. Aegis destroyers, designed to match maximum survivability with potent offensive capability, are 505 feet long, with a beam of 66 feet. Four gas turbine engines power the 8,850-ton ships to speeds in excess of 30 knots.

The destroyers' Aegis Combat System is the world's foremost naval weapons system. As the U.S. Navy's first Aegis shipbuilder, Ingalls delivered 19 ships in the 27-ship TICONDEROGA (CG 47) Class of guided missile cruisers.