Coast Guard to relieve Lockheed, Northrop

The Coast Guard is removing Lockheed Martin Corp. and Northrop Grumman Corp. from their management role over a troubled $24-billion modernization program and may seek new bids for contracts for any incomplete projects.

The deal has been criticized in recent investigations and on Capitol Hill for spiraling costs, design flaws and lax oversight.

Lawmakers had called for the Coast Guard to take the helm of the so-called Deepwater contract, awarded in June 2002 to Integrated Coast Guard Systems, a joint venture of Bethesda, Md.-based Lockheed Martin and Century City-based Northrop Grumman.

Coast Guard Commandant Adm. Thad Allen today will announce plans to take over the role of lead systems integrator for all agency acquisitions, including the Deepwater project, according to a Coast Guard official who spoke on the condition of anonymity because the decision had not been made public.

The Deepwater program includes contracts to design and build 91 cutters, more than 100 small surface ships and 244 new or converted helicopters and airplanes.