Navy Secretary stresses need to reduce acquisition costs

////Navy Secretary stresses need to reduce acquisition costs

Navy Secretary stresses need to reduce acquisition costs

Secretary of the Navy Ray Mabus told a gathering of Navy and Marine Corps personnel and contractors that the main issue facing Navy acquisition is affordability.  “If we don’t do something now, we won’t be able to build the fleet we have to have in the future,” Mabus cautioned.  He further advised participants at the Navy League’s Sea-Air-Space Expo that “we have to reexamine everything that we do” to ensure that the Navy and Marine Corps has the right weapons to meet security goals and missions.  To accomplish this, Mabus underscored that everyone involved in Navy acquisition, including contractors, must adhere to what he described as the “five governing principles of Navy and Marine Corps acquisitions:”  1) clearly identify mission requirements; 2) raise the bar on performance; 3) rebuild the acquisition workforce; 4) support the industrial base; and 5) make every dollar spent on acquisition count.  In comments directed to industry, Mabus said they “have a right to expect reasonable profits” and to expect the Navy to “have stable designs before we start to build things and that we do not change those designs in midcourse.”  But, he said the Navy has a right to expect industry to make necessary investments in infrastructure and train their workforce to operate efficiently.  Secretary Mabus added that the Navy must streamline the contracting process.  It should increase the use of fixed-price contracts, where appropriate use incentives based on cost control, and reserve cost-plus contracts for only high-risk ships and systems.  Describing competition as creating “a more efficient allocation of our resources,” he said that the Navy and Marine Corps should strive to “award up to two-thirds of our contracts in a competitive nature,” and urge contractors to push for competition in their supply chain. 

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