Navy's $171.5M AN/SSQ-53F Sonobuoy System Contract Awarded to ERAPSCO in 2014

Contract Overview

Contract Amount: $171,549,842 ($171.5M)

Contractor: Erapsco

Awarding Agency: Department of Defense

Start Date: 2014-07-17

End Date: 2017-12-04

Contract Duration: 1,236 days

Daily Burn Rate: $138.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: AN/SSQ-53F (FY14)

Place of Performance

Location: COLUMBIA CITY, WHITLEY County, INDIANA, 46725

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $171.5 million to ERAPSCO for work described as: AN/SSQ-53F (FY14) Key points: 1. Contract awarded under a full and open competition, suggesting a robust market. 2. The contract was for a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 3. The firm-fixed-price contract type generally shifts risk to the contractor. 4. The duration of the contract was over three years, indicating a sustained need. 5. The award was made to ERAPSCO, a joint venture, potentially impacting competition dynamics. 6. The North American Industry Classification System (NAICS) code 334511 points to a specialized manufacturing sector.

Value Assessment

Rating: fair

Benchmarking the value of this 2014 contract is challenging without more recent comparable data. The firm-fixed-price structure suggests an attempt to control costs, but the total value of $171.5 million over its period of performance indicates a significant investment. Without detailed cost breakdowns or comparisons to similar systems procured around the same time, a definitive value-for-money assessment is difficult. The contract was a delivery order, implying it was part of a larger, pre-negotiated framework.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit offers. The specific details of the number of bidders are not provided, but a full and open competition generally suggests a healthy level of market interest. This approach aims to ensure the government receives the best possible pricing and technical solutions by leveraging the competitive landscape.

Taxpayer Impact: A full and open competition is generally favorable for taxpayers as it is designed to drive down prices through market forces and encourage innovation among potential suppliers.

Public Impact

The primary beneficiaries are the U.S. Navy's maritime patrol and anti-submarine warfare (ASW) operations. The contract delivers essential sonobuoy systems, critical for detecting submarines and other underwater threats. The geographic impact is primarily within the operational theaters of the U.S. Navy globally. The contract supports jobs in the defense manufacturing sector, particularly in Indiana where the awardee is located.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if AN/SSQ-53F becomes the sole standard without ongoing competitive refresh.
Long-term sustainment costs for specialized systems can escalate if not managed proactively.
Reliance on a single delivery order under an IDIQ could mask underlying cost trends if not monitored.

Positive Signals

Firm-fixed-price contract type helps mitigate cost overrun risks for the government.
Full and open competition suggests a competitive environment that can drive better pricing.
Award to ERAPSCO, a joint venture, may indicate a specialized capability developed through collaboration.

Sector Analysis

The defense sector, specifically the manufacturing of advanced sensor systems for naval applications, is characterized by high technological barriers to entry and significant R&D investment. The market for sonobuoys is relatively niche, dominated by a few key players capable of meeting stringent military specifications. Spending in this area is driven by geopolitical threats and the need for continuous technological advancement in undersea warfare capabilities. Comparable spending benchmarks would involve other advanced sensor procurement contracts within the Department of Defense.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. As a full and open competition, it is unlikely that small businesses were exclusively targeted, though they may have participated as subcontractors. The impact on the small business ecosystem would depend on whether ERAPSCO or any prime contractors involved have established subcontracting plans that include small businesses.

Oversight & Accountability

Oversight for this contract would fall under the Department of the Navy's contracting and program management offices. Accountability measures are typically embedded in the contract terms, including performance standards and delivery schedules. Transparency is facilitated through contract award databases like FPDS-NG. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

AN/SSQ-125 Sonobuoy
AN/SSQ-101 Air Expendable Mobile ASW Training Target
Anti-Submarine Warfare (ASW) Systems
Naval Sensor Systems
Department of Defense Procurement

Risk Flags

Potential for long-term sustainment costs.
Technological obsolescence risk.
Supply chain vulnerability for specialized components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $171.5 million to ERAPSCO. AN/SSQ-53F (FY14)

Who is the contractor on this award?

The obligated recipient is ERAPSCO.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $171.5 million.

What is the period of performance?

Start: 2014-07-17. End: 2017-12-04.

What is the track record of ERAPSCO in delivering similar defense systems?

ERAPSCO (Electro-Optical Systems) is a joint venture formed by Sparton Corporation and Ultra Electronics Ocean Systems. Both parent companies have extensive experience in defense manufacturing, including sonar systems, sonobuoys, and other maritime defense electronics. ERAPSCO itself was established to specifically address the needs of the US Navy for sonobuoys and related systems. Their track record generally indicates a capability to produce and deliver these specialized components, often under competitive contracts. However, specific performance metrics for past contracts, such as on-time delivery rates or quality defect reports, would require deeper analysis of individual contract histories and performance evaluations.

How does the $171.5 million value compare to other sonobuoy procurements?

The $171.5 million value for the AN/SSQ-53F system over its contract period (July 2014 - December 2017) represents a significant but not necessarily anomalous expenditure for advanced military hardware. Sonobuoys are complex, expendable systems requiring sophisticated technology. To provide a precise comparison, one would need to analyze the unit costs and total contract values of similar sonobuoy types (e.g., AN/SSQ-125) procured by the Navy or other allied nations during the same or adjacent timeframes. Factors like technological generation, quantity ordered, and specific performance characteristics heavily influence price. Without direct comparable data points from the same period, it's difficult to definitively state if this represents high or low value, but it aligns with the expected cost of specialized defense electronics.

What are the primary risks associated with this type of defense contract?

Key risks for this type of defense contract include technological obsolescence, as advancements in submarine detection and countermeasures can quickly render existing systems less effective. Supply chain disruptions, particularly for specialized components, pose another significant risk, potentially impacting production timelines and costs. Furthermore, geopolitical shifts can alter demand or introduce new operational requirements, necessitating system upgrades or replacements. For the government, there's also the risk of cost growth if the firm-fixed-price contract doesn't adequately account for unforeseen manufacturing challenges or material price increases. Contractor performance, including quality control and delivery schedules, remains a constant area of risk management.

How effective are AN/SSQ-53F sonobuoys in current naval operations?

The AN/SSQ-53F is a variant of the AN/SSQ-53 series, which has been a workhorse for the U.S. Navy's anti-submarine warfare (ASW) efforts for decades. These sonobuoys are designed to detect and classify submarines by analyzing underwater acoustic signals. While specific operational effectiveness data is classified, the continued procurement and use of this system, and its variants, suggest it remains a relevant and capable tool for maritime patrol aircraft and surface vessels. Its effectiveness is tied to its ability to provide acoustic data that, when processed, helps identify and track potential threats. However, the evolving nature of submarine technology means that continuous upgrades and newer systems are always under development to maintain an advantage.

What has been the historical spending trend for sonobuoys by the Department of the Navy?

Historical spending on sonobuoys by the Department of the Navy has generally shown a consistent, albeit fluctuating, trend driven by operational requirements, fleet size, and technological upgrades. While specific annual figures for all sonobuoy types are not readily available in the public domain, major procurements like the AN/SSQ-53F contract indicate substantial investments in this capability. Spending patterns are influenced by major defense reviews, perceived threats (e.g., increased submarine activity), and the lifecycle of existing systems. The Navy typically procures sonobuoys through a mix of competitive contracts and sole-source awards for highly specialized or upgraded variants, often under larger IDIQ vehicles to ensure availability and manage costs over time.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0042113R0070

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4868 EAST PARK 30 DR, COLUMBIA CITY, IN, 46725

Business Categories: Category Business, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations

Financial Breakdown

Contract Ceiling: $171,549,842

Exercised Options: $171,549,842

Current Obligation: $171,549,842

Subaward Activity

Number of Subawards: 150

Total Subaward Amount: $33,538,875

Contract Characteristics

Consolidated Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0042114D0025

IDV Type: IDC

Timeline