Raytheon Awarded $10.95M FAA Contract for ATCBI-6M5 Sustained Operations Through 2028

Contract Overview

Contract Amount: $10,948,100 ($10.9M)

Contractor: Raytheon Company

Awarding Agency: Department of Transportation

Start Date: 2026-01-06

End Date: 2028-01-06

Contract Duration: 730 days

Daily Burn Rate: $15.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: ATCBI-6M5 SUSTAINMENT WITH CONDOR MK3

Place of Performance

Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73125

State: Oklahoma Government Spending

Plain-Language Summary

Department of Transportation obligated $10.9 million to RAYTHEON COMPANY for work described as: ATCBI-6M5 SUSTAINMENT WITH CONDOR MK3 Key points: 1. Contract value of $10.95M over two years. 2. Sole-source award to Raytheon Company for critical air traffic control system. 3. Potential risk associated with single-vendor reliance for essential infrastructure. 4. Spending falls within the IT and Defense-related manufacturing sector.

Value Assessment

Rating: fair

The contract value of $10.95M for a two-year sustainment period appears reasonable given the specialized nature of air traffic control systems. However, without detailed cost breakdowns or benchmarks for similar sustainment contracts, a precise value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to Raytheon Company. This limits price discovery and potentially leads to higher costs compared to a competitive bidding process. The justification for sole-source is not provided.

Taxpayer Impact: Taxpayer funds are being expended without the benefit of competitive pricing, which could result in a less efficient use of resources.

Public Impact

Ensures continued operation of vital air traffic control systems. Supports national airspace safety and efficiency. Potential for increased costs due to lack of competition. Reliability of air traffic control infrastructure is maintained.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
Potential for cost overruns without competitive pressure.
Dependence on a single vendor for critical system sustainment.

Positive Signals

Ensures continuity of essential air traffic control services.
Contract awarded to a known entity with likely expertise.

Sector Analysis

This contract falls within the IT and Defense-related manufacturing sector, specifically for navigation and guidance systems. Spending benchmarks for sustainment of such critical infrastructure are often high due to specialized knowledge and proprietary technology requirements.

Small Business Impact

This contract was awarded to Raytheon Company, a large business. There is no indication of subcontracting opportunities for small businesses within the provided data, suggesting limited direct impact on the small business sector for this specific award.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential cost creep. The FAA should have robust internal controls to monitor performance and expenditures throughout the contract duration.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Transportation Contracting
Federal Aviation Administration Programs

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for inflated pricing
Vendor lock-in risk
Limited transparency on justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $10.9 million to RAYTHEON COMPANY. ATCBI-6M5 SUSTAINMENT WITH CONDOR MK3

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $10.9 million.

What is the period of performance?

Start: 2026-01-06. End: 2028-01-06.

What is the specific justification for awarding this contract on a sole-source basis, and what steps are being taken to ensure fair pricing?

The justification for a sole-source award typically involves unique capabilities, proprietary technology, or critical urgency where only one vendor can meet the requirements. The FAA should have internal processes to validate these claims and negotiate pricing rigorously. Transparency regarding the justification and cost analysis is crucial for accountability and demonstrating responsible use of taxpayer funds.

What are the long-term risks associated with relying on a single vendor for the sustainment of critical air traffic control systems?

Long-term sole-source reliance can lead to vendor lock-in, reduced innovation, and escalating costs as the vendor faces no competitive pressure. It also creates a single point of failure; if the vendor experiences financial difficulties or operational issues, it could severely disrupt essential services. Diversification strategies or clear transition plans should be considered to mitigate these risks.

How does the performance of the ATCBI-6M5 system compare to industry benchmarks, and is this sustainment contract aligned with achieving optimal system effectiveness?

Assessing system effectiveness requires performance data and comparison against industry standards for air traffic control technology. The sustainment contract's alignment with effectiveness depends on the scope of services, including maintenance, upgrades, and technical support. Without specific performance metrics and benchmark data, it's challenging to definitively state if the contract ensures optimal system effectiveness.

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

Solicitation ID: 697DCK-26-R-00066

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 1001 BOSTON POST RD E, MARLBOROUGH, MA, 01752

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $13,956,673

Exercised Options: $13,956,673

Current Obligation: $10,948,100

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline