U.S. Navy taps HII for $56M AUKUS submarine design work

The U.S. Navy has awarded Huntington Ingalls Industries’ Newport News Shipbuilding a $56.2 million contract for engineering and design work on nuclear-powered submarines for America’s AUKUS partners, with foreign partner funds covering the full cost of the deal.

The Department of War contract announcement describes a cost-plus-fixed-fee deal covering engineering and technical support, along with design agent and design transfer activities for nuclear submarine capabilities and their sustainment. The work falls under Foreign Military Sales, the government-to-government channel Washington uses to sell defense equipment and services abroad, and an option, if exercised, would lift the total value to $91.1 million.

While the Pentagon notice leaves the foreign customer unnamed, HII filled in the gap on Oct. 13, saying in a company release that the award supports the trilateral Australia, United Kingdom and United States partnership known as AUKUS.

Signed in 2021, AUKUS is meant to give Australia a fleet of conventionally armed, nuclear-powered attack submarines. Canberra plans to acquire at least eight boats, including three to five Virginia-class submarines bought from the United States in the 2030s, followed by a new class designed with Britain and known as SSN-AUKUS.

According to HII, Newport News will keep supporting both the United Kingdom and Australia under the contract through technology insertion and engineering, as well as supply chain and workforce development. The award also funds an effort called United States Industry Support, under which Newport News engineers and designers will help design the SSN-AUKUS boat that Britain and Australia will build.

“Our longstanding nuclear experience at NNS directly benefits the AUKUS mission to support shared security objectives,” said Bryan Caccavale, Newport News Shipbuilding vice president of program management.

In submarine programs, the design agent is the yard responsible for a class’s technical design and for keeping it current over the boats’ service lives. Design transfer is the handover of that technical knowledge to another builder or navy, which Australia needs before it can maintain and eventually build nuclear submarines of its own.

Newport News will carry out 88% of the work at its Virginia shipyard, with the remaining 12% taking place at unspecified foreign locations. Work is scheduled to finish in September 2027, or in September 2028 if the option is exercised.

The contract carries no U.S. funding, and $19.1 million in foreign partner funds was obligated at the time of award without expiring at the end of the current fiscal year. Naval Sea Systems Command awarded the contract without competition, citing a statute that applies when only one responsible source can meet the requirement.

Newport News is one of only two American shipyards that build nuclear-powered submarines. It builds the bows, sterns and other modules for both the Virginia and Columbia classes, while General Dynamics Electric Boat in Groton, Connecticut, builds the central reactor section.

Electric Boat received a comparable award in April, a $196 million contract that Rep. Joe Courtney described as the first awarded by the U.S. Navy for AUKUS work. That deal used the same wording on engineering, design agent and design transfer support, and its options could raise its value to more than $930 million through April 2031.

On the Australian side, HII’s local operations won a 2025 contract to run the Australian Submarine Supplier Qualification Pilot Program, worth an initial A$9.6 million, which vets Australian companies for entry into the U.S. submarine supply chain.

Australia has pledged $3 billion to the U.S. submarine industrial base, paid in installments, and had delivered $2 billion of that amount as of April 23, according to Courtney.