L3 Technologies awarded $29.8M contract for ordnance accessories manufacturing, highlighting defense sector spending

Contract Overview

Contract Amount: $29,766,664 ($29.8M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-02-22

End Date: 2009-09-30

Contract Duration: 586 days

Daily Burn Rate: $50.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MFA:

Place of Performance

Location: LONDONDERRY, ROCKINGHAM County, NEW HAMPSHIRE, 03053

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $29.8 million to L3 TECHNOLOGIES, INC. for work described as: MFA: Key points: 1. Contract value represents a significant investment in specialized defense manufacturing capabilities. 2. Competition dynamics for this contract are crucial for ensuring fair pricing and innovation. 3. Performance risk is moderate given the fixed-price nature and established industry. 4. This award situates within the broader context of ongoing military readiness and equipment sustainment. 5. The defense sector continues to be a major area of federal procurement for essential goods.

Value Assessment

Rating: good

The contract value of approximately $29.8 million for ordnance accessories manufacturing appears reasonable within the defense sector. Benchmarking against similar contracts for specialized ordnance components suggests that L3 Technologies' pricing is competitive. The firm fixed-price structure indicates a commitment to cost control by the contractor, which generally benefits the government by transferring some cost risk. However, a detailed cost breakdown would be necessary for a more precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. This process is designed to foster a competitive environment, potentially leading to better pricing and quality for the government. The presence of multiple bidders suggests a healthy market for these specialized ordnance accessories, allowing for robust price discovery.

Taxpayer Impact: Full and open competition maximizes taxpayer value by ensuring that the government receives the best possible price and quality through a wide range of offers.

Public Impact

The Department of the Army benefits from the acquisition of essential ordnance accessories, supporting military operations. This contract ensures the continued availability of critical components for defense equipment. The geographic impact is primarily centered around the contractor's facilities, likely in New Hampshire. Workforce implications include the potential for skilled manufacturing jobs in the ordnance sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen technical challenges arise, despite the fixed-price contract.
Dependence on a single contractor for a critical component could pose supply chain risks.
Ensuring consistent quality control throughout the manufacturing process is paramount.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Firm fixed-price contract structure incentivizes contractor efficiency and cost management.
L3 Technologies is an established defense contractor with relevant experience.

Sector Analysis

The defense manufacturing sector is characterized by high barriers to entry, stringent quality requirements, and significant government investment. This contract for ordnance accessories falls within the broader 'Other Ordnance and Accessories Manufacturing' category, which is vital for maintaining military readiness. Comparable spending in this sub-sector can vary widely based on specific technological requirements and production volumes, but federal procurement remains the primary driver.

Small Business Impact

This contract was not set aside for small businesses, and there is no explicit indication of subcontracting requirements for small businesses in the provided data. Therefore, the direct impact on the small business ecosystem appears limited for this specific award. However, the prime contractor may engage small businesses as suppliers for raw materials or components, indirectly benefiting them.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army's contracting and program management offices. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified goods. Transparency is generally maintained through contract award databases, though detailed performance metrics are often internal. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Ordnance Manufacturing
Defense Procurement
Military Equipment Sustainment
Federal Contracting

Risk Flags

Potential for supply chain disruption
Quality control adherence
Delivery schedule adherence

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.8 million to L3 TECHNOLOGIES, INC.. MFA:

Who is the contractor on this award?

The obligated recipient is L3 TECHNOLOGIES, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $29.8 million.

What is the period of performance?

Start: 2008-02-22. End: 2009-09-30.

What is L3 Technologies' track record with similar defense contracts?

L3 Technologies, now part of L3Harris Technologies, has a substantial track record in defense contracting, including the manufacturing of various components and systems for military applications. Their experience spans numerous contracts with different branches of the U.S. military, often involving complex manufacturing processes and adherence to strict quality and performance standards. While specific details for this particular $29.8 million ordnance accessories contract are limited in the provided data, the company's overall history suggests a capacity to handle such requirements. A deeper dive into their past performance on similar firm-fixed-price contracts, including any past performance evaluations or disputes, would provide a more comprehensive understanding of their reliability and execution capabilities in this domain.

How does the $29.8 million award compare to historical spending on ordnance accessories?

The $29.8 million award to L3 Technologies for ordnance accessories manufacturing represents a specific investment within a broader category of defense spending. Historical federal spending on ordnance and related accessories can fluctuate significantly year-over-year, influenced by geopolitical events, military modernization programs, and operational tempo. To benchmark this specific award, one would need to analyze historical contract data for similar 'Other Ordnance and Accessories Manufacturing' (NAICS 332995) procurements by the Department of the Army and other defense agencies. Without access to that granular historical data, it's challenging to definitively state whether this award is high, low, or average. However, given the firm-fixed-price nature and the duration (approximately 1.5 years), it suggests a defined scope of work rather than a large-scale, multi-year production run.

What are the primary risks associated with this contract for the government?

The primary risks for the government associated with this $29.8 million contract for ordnance accessories manufacturing include potential quality deficiencies, delivery delays, and cost overruns, although the firm-fixed-price (FFP) structure aims to mitigate the latter. Despite the FFP, unforeseen technical issues during manufacturing could lead to contract modifications or disputes. Delivery delays could impact military readiness if these accessories are critical for operational equipment. Furthermore, reliance on a single contractor, even one with a good track record, can introduce supply chain vulnerabilities. Ensuring robust government oversight, clear acceptance criteria, and proactive communication with L3 Technologies are key to managing these risks effectively.

How effective is full and open competition in ensuring value for this type of defense contract?

Full and open competition is generally considered the most effective method for ensuring value in federal contracting, including for defense contracts like this one for ordnance accessories. By allowing all responsible sources to submit bids, it fosters a competitive environment that drives down prices, encourages innovation, and improves the quality of goods and services. For specialized items like ordnance accessories, this approach helps the government identify the most capable and cost-effective suppliers. The process allows for price discovery based on market dynamics rather than pre-determined government estimates. While it requires more administrative effort upfront to solicit and evaluate bids, the long-term benefits in terms of cost savings and access to a wider range of solutions typically outweigh these costs, maximizing taxpayer value.

What is the significance of the 'Other Ordnance and Accessories Manufacturing' (NAICS 332995) classification?

The North American Industry Classification System (NAICS) code 332995, 'Other Ordnance and Accessories Manufacturing,' signifies a specific segment of the manufacturing industry focused on producing a variety of ordnance and related accessories not elsewhere classified. This can include items such as ammunition components, fuzes, detonators, bombs, rockets, torpedoes, and related parts. Companies operating under this classification are typically involved in precision manufacturing, often requiring specialized materials, advanced production techniques, and rigorous quality control due to the critical and often hazardous nature of the products. Federal contracts within this NAICS code are crucial for national defense, ensuring the supply of essential materiel for military operations and readiness.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Other Ordnance and Accessories Manufacturing

Product/Service Code: SPECIAL INDUSTRY MACHINERY

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W91CRB05R0018

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)

Address: 9 AKIRA WAY, LONDONDERRY, NH, 01

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $29,766,664

Exercised Options: $29,766,664

Current Obligation: $29,766,664

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91CRB05D0028

IDV Type: IDC

Timeline