DoD awards $56M contract for Shipset systems to BAE Systems, raising competition concerns

Contract Overview

Contract Amount: $37,883,189 ($37.9M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2007-01-19

End Date: 2009-07-19

Contract Duration: 912 days

Daily Burn Rate: $41.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Defense

Official Description: 56M SHIPSET

Place of Performance

Location: TOTOWA, PASSAIC County, NEW JERSEY, 07512

State: New Jersey Government Spending

Plain-Language Summary

Department of Defense obligated $37.9 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: 56M SHIPSET Key points: 1. Contract Value: $56 million for Shipset systems. 2. Sole Source: Awarded to BAE Systems without competition. 3. Risk: Lack of competition may lead to higher costs. 4. Sector: Defense industry, specifically navigation and guidance systems.

Value Assessment

Rating: questionable

The contract value of $56 million for Shipset systems is significant. Without competitive bidding, it's difficult to assess if this price is optimal compared to similar systems in the market.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to BAE Systems. This limits price discovery and potentially increases the cost to the government.

Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for these critical defense systems.

Public Impact

Impacts national defense capabilities through the provision of essential navigation and guidance systems. Supports a major defense contractor, BAE Systems, and its supply chain. Highlights potential for increased defense spending due to non-competitive awards.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Potential for overpricing

Positive Signals

Essential defense system
Established contractor

Sector Analysis

This contract falls within the Defense sector, specifically manufacturing navigation, guidance, and related systems. Spending in this area is critical for military operations, but competitive procurement is key to efficiency.

Small Business Impact

The data does not indicate any direct involvement or benefit to small businesses in this specific contract award. Further analysis would be needed to determine subcontracting opportunities.

Oversight & Accountability

The award was managed by the Department of Defense via the Defense Contract Management Agency. Oversight is crucial to ensure fair pricing and performance, especially in sole-source situations.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for cost overruns
Limited transparency in pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.9 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. 56M SHIPSET

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $37.9 million.

What is the period of performance?

Start: 2007-01-19. End: 2009-07-19.

What is the justification for the sole-source award, and how does it ensure value for money?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without this specific justification, it's challenging to ascertain if the government received fair value. A thorough review of the procurement file would be necessary to understand the rationale and assess the value proposition.

What are the risks associated with awarding a $56 million contract without competition?

The primary risk is the potential for inflated pricing due to the absence of competitive pressure. This can lead to inefficient use of taxpayer funds. Additionally, it may stifle innovation from other potential suppliers and reduce overall market competition in the long run, potentially impacting future procurement costs.

How effective is the Defense Contract Management Agency in overseeing sole-source awards like this one?

The effectiveness of the DCMA in overseeing sole-source awards depends on robust auditing, negotiation, and performance monitoring processes. While they aim to ensure fair pricing and contract compliance, the inherent lack of competition makes their role even more critical. Independent reviews and clear performance metrics are essential to gauge their success.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 65 SPIT BROOK RD, NASHUA, NH, 03060

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $37,883,189

Exercised Options: $37,883,189

Current Obligation: $37,883,189

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: F0960303D0001

IDV Type: IDC

Timeline