The Navy’s problem-plagued Advanced SEAL Delivery System (ASDS) continues to have performance and reliability problems long after its delivery to the Navy. The craft, which was to have been the harbinger of a fleet of advanced submersibles carried into hostile waters on U.S. nuclear submarines, has suffered from poor contracting practices, lenient oversight, and an unqualified builder, according to a recently released Government Accountability Office (GAO) report.

The craft was accepted by the Navy in 2003, despite shortcoming and continued problems. That was some six years beyond the original delivery schedule. Although it has been operationally deployed aboard a nuclear-propelled attack submarine, problems continue and the Department of Defense has halted production of additional units.

Several attack submarines as well as the four cruise missile-SEAL transport submarines (SSGN) converted from giant Trident “boats” were each to carry one and two ASDS vehicles, respectively. Instead the submarines now deliver SEALS by “wet” vehicles, with shorter range and fewer capabilities -- which can be carried in seven dry shelters that can be attached to submarines -- or by rubber boats, much the same as commandos were landed from submarines in World War II.

The Senate Armed Services Committee asked the GAO for the review of the ASDS program. The GAO report, released in late May, was critical of the Navy accepting the vehicle from the Northrop Grumman Corporation, and for continuing to pay the contractor for repairs, maintenance and upgrades, mostly under labor-hour contracts or agreements based on actual costs plus a pre-negotiated fee. The Navy’s contracting procedures provided little incentive for the firm to meet schedules or cost goals, and the contractor exceeded cost estimates on almost one-half of the delivery orders and missed schedule targets on 20 of 26 orders.

Navy officials justified those contract structures as reasonable given the high risk associated with implementing new and complicated technologies, but shifted to more incentive-based fee structures over the following two years. The GAO report said that there were early signs of better performance in the later period, although it was too early to gauge results.

The GAO found that Navy officials also failed to follow best contracting practices by frequently not settling on terms such as cost and scope of work before authorizing the contractor to proceed. In some cases, terms were not agreed upon until after the work was complete. Navy officials told the GAO that they were now taking more time with requirements development and pushing the
contractor to be realistic in its cost and schedule estimates, and said all contract terms have been fully defined before award during the last two years.

The Navy is evaluating how much it will cost to complete “fixes” and modifications to the single ASDS and whether it makes sense to even do so. A decision is expected within a year. To date an estimated $885 million has been spent on the troubled program, according to the GAO.

-- Norman Polmar