The U.S. Navy awarded TOTE Services a $2.2 billion contract on July 13, 2026, to serve as vessel construction manager (VCM) for the Marine Corps’ Landing Ship Medium (LSM) program, placing a commercial maritime firm in prime contractual authority over established defense shipyards for the first time.
Under the structure, TOTE holds the prime award and directs subcontracts to Bollinger Shipyards on the Gulf Coast and Wisconsin-based Fincantieri Marinette Marine, inverting the traditional Navy acquisition model where defense shipbuilders typically hold the prime contract and carry full accountability to the government.
The Navy said the approach aims to “maximize commercial practices to accelerate delivery, improve cost discipline, and expand the U.S. shipbuilding industrial base,” calling the VCM strategy “an innovative shift in Navy shipbuilding.”
Today, we awarded TOTE Services LLC a $2.2 billion contract for Vessel Construction Management of the LSM.
This action, completed in 5 months from contract solicitation to award, continues our effort to aggressively field this needed capability for the @USMC@USNavy @SECNAV pic.twitter.com/vFIzg3punB
— PAE Maritime (@PAEMaritime) July 13, 2026
The FY2026 National Defense Authorization Act directed the Navy to select a VCM from outside the military for the program. Jacksonville, Florida-based TOTE is the first company to hold that role.
With options, the contract reaches $2.6 billion for up to eight ships, with full completion expected by June 2030 and the first delivery targeted for fall 2029.
Work is distributed across Marinette, Wisconsin (65%), Houma, Louisiana (16%), and Jacksonville (9%).
The McClung-class is based on the Damen Landing Ship Transport 100 (LST-100), a Dutch commercial platform roughly 330 feet long.
Each ship can carry 500 tonnes of cargo across a 3,400-nautical-mile range.The Marine Corps designed the LSM for island-hopping operations in contested Pacific environments in a potential conflict with China.
The lead ship, USS McClung, is named for Maj. Megan M.L. McClung, the first female Marine officer killed in combat, who died in Ramadi, Iraq, in December 2006.
Fincantieri Marinette Marine, which is currently executing a truncated Constellation-class frigate program, secured a separate $30 million contract in April for long-lead material on four of the eight ships.
