The Navy awarded two contracts on May 7, 2026, totaling approximately $103 million to expand its submarine test infrastructure and unmanned undersea vehicle fleet. General Dynamics Mission Systems received a $66.2 million sole-source IDIQ for continued development of the Data Acquisition and Retrieval System that supports Virginia-class and Columbia-class submarine test programs. Hours later, Huntington Ingalls Industries Unmanned Systems in Pocasset, Massachusetts, received a $37 million contract modification to exercise an option for continued Lionfish Small Unmanned Undersea Vehicle production. The paired awards reflect the Navy's sustained investment in the test and evaluation infrastructure needed to field its two most strategically important submarine classes while simultaneously expanding its unmanned undersea warfare capability.

General Dynamics: $66M for Virginia- and Columbia-class test data

The Naval Undersea Warfare Center Division at Newport, Rhode Island, awarded General Dynamics Mission Systems Inc. in Manassas, Virginia, contract N66604-26-D-B600 — a five-year, cost-plus-fixed-fee and cost-only IDIQ — for continued Small Business Innovative Research Phase III development of the Data Acquisition and Retrieval System. The DARS program provides the instrumentation backbone for capturing, storing, and analyzing sensor data during submarine acoustic, weapons, and propulsion tests conducted at facilities in Groton, Connecticut (80 percent of work); Newport, Rhode Island (10 percent); Port Canaveral, Florida (5 percent); and Andros Island, Bahamas (5 percent). The contract runs through May 2031.

The SBIR Phase III designation is significant in two respects. First, it means the work is a direct commercialization of intellectual property developed during earlier SBIR Phase I and II research — a bridge from laboratory-scale innovation to fielded capability that the government can acquire without full and open competition under 10 U.S. Code 3204(a)(5) and FAR 6.302-5. Second, it means the contract is structured as an IDIQ, giving the Navy flexibility to order work across the five-year period as test program requirements evolve — an important feature for a test system that must adapt to the changing sensor loads and data volumes generated by increasingly capable submarines.

The Virginia class is the Navy's workhorse attack submarine, with 23 boats in commission and additional hulls under construction at Huntington Ingalls in Newport News and General Dynamics Electric Boat in Groton. The Columbia class — the Navy's next-generation ballistic missile submarine — is the single highest-priority shipbuilding program in the Navy's portfolio, with the lead boat, USS District of Columbia (SSBN-826), under construction at Electric Boat with a targeted delivery in the early 2030s. Both programs require extensive test programs covering acoustic signatures, weapons system integration, and propulsion performance, and both depend on DARS-type data collection infrastructure to generate the characterization data that validates submarine performance against operational requirements.

HII: $37M Lionfish UUV production option

The Naval Sea Systems Command awarded Huntington Ingalls Industries Unmanned Systems a $36,985,007 firm-fixed-price modification to exercise a production option for Lionfish Small Unmanned Undersea Vehicles, along with support equipment and ancillary services. The work will be performed at HII's Uncrewed Systems facility in Pocasset, Massachusetts (99 percent), with a small fraction of work in Hampton, Virginia, and the contract runs through May 2027.

The Lionfish is a man-portable small UUV based on the REMUS 300 platform and is designed to support a broad range of missions — counter-mine warfare, anti-submarine warfare, intelligence, surveillance, and reconnaissance, and environmental survey — from any surface vessel. It can operate to depths of 1,000 feet, run for up to 30 hours per mission, and achieve speeds up to 5 knots. The open-systems architecture supports mission-specific payload integration, including side-scan sonar, electro-optical cameras, and environmental sensors. HII delivered the first two Lionfish vehicles to the Navy under a prior production contract and has stated that the full program could eventually reach 200 vehicles with a potential value exceeding $347 million.

The funding breakdown for this option exercise reflects multi-year budget support: fiscal 2026 shipbuilding and conversion Navy funds cover $567,377 (51 percent of the initial obligated amount), fiscal 2023 funds cover $369,216 (33 percent), and fiscal 2024 funds cover the remaining $174,487. This funding split indicates the program has been managed as a multi-year acquisition with incremental funding, a common approach for production programs that span annual appropriation cycles.

The submarine and UUV investment picture

The two May 7 awards are part of a broader Navy investment pattern in submarine-related capability. In the same day's contract announcements, SEACORP LLC in Middletown, Rhode Island, received a $31.9 million cost-plus-fixed-fee IDIQ for development of payload control system technology for Navy submarines — covering work across 16 states and two countries over a five-year ordering period. Together, the three awards on May 7 alone directed approximately $135 million into submarine and undersea warfare infrastructure.

The Navy's submarine industrial base has been under significant pressure to expand capacity to support the Virginia-class multi-year procurement and Columbia-class construction simultaneously, while also meeting commitments to supply Australia under the AUKUS agreement. The DARS investment at Newport supports that effort by ensuring the test infrastructure can handle the increased throughput of submarines requiring post-construction acoustic characterization. The Lionfish investment reflects the Navy's parallel push to develop a distributed undersea sensor and strike network in which small UUVs extend the reach of manned submarines by operating in areas too shallow, too contested, or too risky for crewed platforms.

What it means for contractors

  • The DARS SBIR III sole-source structure signals that General Dynamics Mission Systems has established a protected position for submarine test data systems at NUWC Newport — firms interested in this market should pursue SBIR Phase I and II programs at NUWC as the pathway to future sole-source Phase III vehicles.
  • The Lionfish program's multi-year buy structure suggests additional option exercises are likely through the program ceiling — suppliers of REMUS 300-compatible payloads and support equipment should be in contact with HII's Pocasset facility on teaming opportunities.
  • The SEACORP payload control contract reflects continued demand for specialized submarine software and systems integration firms at the IDIQ level — small firms with submarine payload integration expertise should monitor NUWC Newport's contracting office for similar solicitations.
  • Defense electronics and sensor firms with UUV payload experience should watch for Lionfish payload integration solicitations as the fleet grows toward its potential 200-vehicle objective.

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