DoD's $183M LITENING Pods & Kits Order Awarded to Northrop Grumman in 2010

Contract Overview

Contract Amount: $183,139,060 ($183.1M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2010-12-28

End Date: 2013-09-30

Contract Duration: 1,007 days

Daily Burn Rate: $181.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: LITENING PODS&KITS ORDER FOR 2010

Place of Performance

Location: ROLLING MEADOWS, COOK County, ILLINOIS, 60008

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $183.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: LITENING PODS&KITS ORDER FOR 2010 Key points: 1. Value for money is difficult to assess without detailed cost breakdowns and comparisons to similar systems. 2. The contract was awarded on a sole-source basis, limiting competitive dynamics and potentially impacting price discovery. 3. Risk indicators include the sole-source award and the long duration of the contract, which could lead to cost overruns if not managed effectively. 4. Performance context is limited as this is a specific order, not a comprehensive program review. 5. This contract falls within the Defense sector, specifically related to aircraft equipment manufacturing.

Value Assessment

Rating: fair

Benchmarking the value of this specific order is challenging without more granular cost data and comparisons to other LITENING pod procurements or similar targeting pod systems. The firm-fixed-price contract type suggests a defined cost structure, but the overall value relative to the capabilities delivered is not readily apparent from the provided data. Further analysis would require understanding the unit costs, the number of pods and kits procured, and how this price compares to historical or projected costs for similar systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Northrop Grumman Systems Corporation, was considered. This approach bypasses the standard competitive bidding process, which typically involves multiple companies submitting proposals. While sole-source awards can be justified for specialized or proprietary technologies, they limit the government's ability to leverage competition to drive down prices and ensure the best possible value.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as the government does not benefit from the price reductions typically achieved through competitive bidding. This limits the government's negotiating power and potentially leads to less efficient use of public funds.

Public Impact

The U.S. Department of the Navy benefits from the acquisition of advanced LITENING pods and kits, enhancing its aerial surveillance and targeting capabilities. These pods and kits are crucial for modern warfare, enabling precision strikes and intelligence gathering. The geographic impact is primarily within the Department of Defense's operational theaters, supporting military missions globally. Workforce implications include supporting jobs at Northrop Grumman and its supply chain, particularly in Illinois where the contractor is based.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition.
Long contract duration (over 2 years) increases potential for cost escalation if not managed.
Lack of detailed cost breakdown makes value assessment difficult.

Positive Signals

Firm-fixed-price contract type provides cost certainty for the government.
Procurement of advanced targeting pods enhances military capabilities.
Contract awarded to an established defense contractor with likely relevant experience.

Sector Analysis

The defense industry, particularly the segment focused on aerospace and defense electronics, is characterized by high R&D costs, long product cycles, and significant government procurement. Northrop Grumman is a major player in this sector. The market for targeting pods is specialized, with a limited number of prime contractors capable of producing such advanced systems. This contract represents a specific procurement within the broader defense electronics market, which is valued in the billions of dollars annually.

Small Business Impact

There is no indication from the provided data that this contract involved small business set-asides or subcontracting goals. As a sole-source award to a large prime contractor, the direct impact on small businesses is likely minimal unless Northrop Grumman voluntarily engages them in its supply chain. Further investigation into Northrop Grumman's subcontracting practices would be needed to assess any indirect impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would fall under the Department of Defense's contracting and program management structures. Accountability measures are typically embedded within the contract terms, including performance metrics and delivery schedules. Transparency is limited due to the sole-source nature and the proprietary information often associated with defense technologies. The Inspector General's office within the DoD would have jurisdiction to investigate any potential fraud, waste, or abuse.

Related Government Programs

LITENING Targeting Pod Program
Advanced Aerial Systems
Defense Electronics Procurement
Department of the Navy Contracts
Northrop Grumman Defense Contracts

Risk Flags

Sole-source award
Lack of competition
Limited transparency on pricing
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $183.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. LITENING PODS&KITS ORDER FOR 2010

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $183.1 million.

What is the period of performance?

Start: 2010-12-28. End: 2013-09-30.

What is the historical spending trend for LITENING pods and kits by the Department of Defense?

Analyzing historical spending on LITENING pods and kits requires accessing detailed contract databases and procurement histories. While this specific order from 2010 accounts for $183.1 million, understanding the broader trend involves looking at prior and subsequent awards for the same system, as well as potential upgrades or variants. Factors influencing spending include operational tempo, fleet modernization efforts, and the introduction of competing technologies. A comprehensive review would likely reveal fluctuations based on defense budgets, strategic priorities, and the lifecycle of the technology. Without access to a longitudinal dataset specifically for LITENING pods, it's difficult to provide precise historical spending figures or identify clear trends beyond this single data point.

How does the unit cost of the LITENING pods and kits in this order compare to market rates or similar systems?

Determining the precise unit cost for the LITENING pods and kits within this $183.1 million order is challenging without knowing the exact quantity procured. However, if we assume a significant number of pods and kits were ordered, the average unit cost would need to be benchmarked against industry standards and competitor offerings. The LITENING pod is a mature system, and its price would be influenced by production volume, technological maturity, and competition from systems like the Sniper Advanced Targeting Pod. Given the sole-source nature of this award, it's possible the unit price may not reflect the lowest achievable cost. A detailed comparison would require access to Northrop Grumman's pricing structure for this specific contract and a thorough market analysis of comparable systems available during the 2010-2013 period.

What are the specific risks associated with a sole-source award for critical defense equipment like targeting pods?

Sole-source awards for critical defense equipment, such as LITENING pods, carry several inherent risks. Primarily, the lack of competition can lead to inflated prices, as the government does not benefit from the cost-saving pressures that arise when multiple vendors vie for a contract. This can result in a less efficient use of taxpayer funds. Furthermore, sole-sourcing can stifle innovation by reducing the incentive for the sole provider to invest heavily in improving the product or its manufacturing processes, knowing they have a guaranteed market. There's also a risk of vendor lock-in, making it difficult and costly to switch to alternative solutions in the future. Finally, it can create a perception of favoritism or a lack of due diligence in the procurement process, potentially undermining public trust.

What is Northrop Grumman's track record with producing and delivering LITENING pods and similar targeting systems?

Northrop Grumman has a well-established track record in the development and production of advanced targeting pods, including the LITENING system. The LITENING pod has been a significant product for the company, equipping numerous U.S. and allied aircraft for decades. The company has consistently delivered these systems, often incorporating upgrades and enhancements over time to maintain technological relevance. Their experience spans multiple generations of the LITENING pod, demonstrating a capacity for sustained production and technological evolution. While specific performance metrics for every contract are not publicly available, the continued procurement and operational use of LITENING pods by various military branches suggest a generally positive track record in terms of reliability and capability delivery.

How has the operational demand for targeting pods like LITENING evolved since this contract was awarded in 2010?

Since the 2010 award of this LITENING pod contract, the operational demand for such systems has likely evolved significantly, driven by changes in warfare tactics, technological advancements, and geopolitical landscapes. The period since 2010 has seen continued emphasis on precision strike capabilities, intelligence, surveillance, and reconnaissance (ISR), and counter-terrorism operations, all of which rely heavily on advanced targeting pods. Technological evolution has led to demands for higher resolution imagery, improved data links, artificial intelligence integration for target recognition, and enhanced electronic warfare capabilities. Furthermore, the proliferation of drones and counter-drone technologies may also influence the requirements and development of manned aircraft targeting systems. Consequently, while the LITENING pod remains a relevant system, newer generations and competing technologies have emerged to meet these evolving demands.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0001908R0206

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation (UEI: 967356127)

Address: 600 HICKS RD, ROLLING MEADOWS, IL, 90

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $183,139,060

Exercised Options: $183,139,060

Current Obligation: $183,139,060

Contract Characteristics

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0001909D0025

IDV Type: IDC

Timeline