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The construction of the last two Virginia-class Block V nuclear submarines was contracted to expand the naval workforce and strengthen the defense capability of the U.S. Navy.
In a strategic move, the United States Navy has awarded contracts worth more than $18,5 billion for the construction of the last two Virginia Block V class nuclear submarines.
The vessels, which will be named USS Baltimore (SSN-812) and USS Atlanta (SSN-813), will be built by General Dynamics Electric Boat (GDEB) and Huntington Ingalls Industries (HII), marking the end of production of this important variant consisting of 12 units.
Virginia Block V class submarines will be a breakthrough for the US Navy
The new contracts represent an essential step in maintaining the strength and readiness of the United States Navy on the global stage.
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The Virginia class is considered one of the most advanced today, being designed for attack and surveillance missions in strategic areas.
The last two units of Block V come to consolidate the modernization of the fleet and integrate cutting-edge technologies into North American naval power.
According to the official statement, approximately US$17,15 billion will be allocated to General Dynamics Electric Boat, while HII will receive US$1,29 billion to execute the project.
In addition to the construction of the submarines, the contract includes investments in salary increases for the specialized workforce, as well as improvements in the infrastructure and systems of the shipyards involved.
Investment goes beyond construction: focus on labor and industrial structure
With the cost of submarines increasing by up to 20% in recent years — especially due to shortages workers qualified and rising wages in the naval sector — the US Navy saw the need to increase contract values.
Mark Rayha, president of General Dynamics Electric Boat, highlighted the importance of the measure:
“Over the past two years, we have successfully partnered with the Navy, Congress and the Administration to secure funding to increase wages for the nuclear shipbuilding workforce and make significant additional investments in shipyard capacity, processes and systems.”
This financial reinforcement also reflects the Navy's concern with maintaining a stable pace of production, given the recent delays observed in other programs, such as the Constellation-class frigates.
Redefining contracts and distributing risks
Contracts for the two Virginia-class submarines were originally scheduled to be signed in fiscal year 2024. However, negotiations were delayed due to concerns about rising costs and the need to establish new control mechanisms.
New US Secretary of the Navy John Phelan commented on the change in approach:
“We recently renegotiated the planned contract to deliver this critical capability and appropriately distribute risk between the Navy and industry. We will review all future contracts with the same lens to ensure an appropriate level of risk sharing and value to the American taxpayer.”
This new stance aims to make the relationship between the government and the private sector more balanced, ensuring efficiency in the delivery of strategic projects for national defense.
In addition to these two, more submarines are on the way
Despite recent challenges, the U.S. Navy has no intention of slowing down.
A new cycle of multi-year contracts is already being planned for the construction of up to 15 additional submarines, of which 10 would be of the Virginia Block VI class and 5 of the new Columbia Build II class, aimed at strategic nuclear deterrence missions.
