Navy Maintenance:

Assessment of the Public and Private Shipyard Competition Program

NSIAD-94-184: Published: May 25, 1994. Publicly Released: Jun 1, 1994.

Additional Materials:

Contact:

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Pursuant to a congressional request, GAO provided information on competition between public and private shipyards, focusing on: (1) the disbursement of repair and maintenance contracts between public and private-sector bidders; (2) whether the Navy's procurement procedures afford public or private bidders a competitive advantage; and (3) the effectiveness of the Navy's public-private competition program in reducing costs.

GAO found that: (1) public shipyards are not competitive with private shipyards for ship maintenance and modernization services; (2) since 1988, public shipyards have won less than 14 percent of the competitively-procured surface ship contracts; (3) nuclear-capable public shipyards have not been awarded any of the 17 surface ship repair contracts that have been solicited since the inception of the competition program; (4) private shipyards have won 89 percent of the submarine repair competitions since fiscal year 1993; (5) public shipyards are not competitive with private-sector shipyards because they are required to include proportional overhead costs in their bids, their bids are not evaluated for cost realism, and they are required to submit full-cost bids; (6) private shipyards have a significant competitive advantage because they are allowed to submit below-cost bids as long as they are found to be responsible; (7) public shipyards are able to perform submarine repair work more cost-effectively than private-sector shipyards; (8) although the Navy's public-private competition program has been useful in improving the efficiency of public shipyards and decreasing the cost of depot maintenance work, the program may not be cost-effective or viable in the current economic environment; and (9) although there are no compelling reasons to discontinue the public-private competition program, many issues related to program implementation and work allocation need to be resolved.

Sep 21, 2016

Aug 3, 2016

Aug 1, 2016

Jul 14, 2016

Jul 5, 2016

Jun 30, 2016

Jun 28, 2016

Jun 23, 2016

Jun 22, 2016

Looking for more? Browse all our products here