Austal USA Delivers First LCU for the U.S. Navy

Defense shipbuilder Austal USA has delivered its first landing craft for the U.S. Navy, the first ever steel-hull vessel that the company has completed and delivered to its primary customer.

“The delivery of LCU 1710 represents a major achievement for Austal USA and our shipbuilding team,” said Gene Miller, President of Austal USA. “It also demonstrates Austal USA’s ability to skillfully design, build and deliver highly complex steel vessels while continuing to support the Navy’s evolving mission requirements.”

LCU 1710 is a next-generation landing craft utility for the amphib fleet, designed to haul Marines and their equipment to a beachhead after the initial stages of an amphibious assault (or other handy uses, like delivering disaster relief supplies).

Austal's steel shipbuilding line is new and has yet to become profitable for the company, dragging on group performance with an expected division loss of -$175 million in FY2026. The LCU contract is loss-making, along with its Towing, Salvage & Rescue Ship (T-ATS) and Auxiliary Floating Dry Dock Medium (AFDM) programs.

Austal's early bids underestimated cost of completion for its first steel hulls, and the Navy has yet to renegotiate pricing to help out Austal's bottom line. The firm said in its most recent earnings report that it will continue to pursue contract modification to adjust for extra costs, and that its claims are justified to pay for "changes in customer requirements and deficiencies in design specifications provided to Austal USA" - a widely-acknowledged issue in Navy shipbuilding, and an area that the Pentagon is actively working to address.

Steel construction is a recent development at its U.S. yard, and reflects the Navy's experience with the difficulties of aluminum construction in naval applications. As it phased out aluminum-hull procurement, the Department of Defense supported Austal in its efforts to develop its steel capabilities. This included a $50 million matching grant toward the construction of the steel line and the development of additional capacity for steel naval vessel construction at its Mobile shipyard.

Austal USA launched its first steel-hulled ship, the salvage tug USNS Billy Frank Jr., in June 2025. The tug was envision as a starter contract for Austal USA develop its skills in steel construction and its new automated steel panel line. It was recently moved over to a berth at Alabama Shipyard (an Austal affiliate) but has not yet delivered. The LCU, being a smaller and simpler vessel, launched two months after Billy Frank Jr. but delivered sooner.