DoD awards $35.6M for robotics systems to iRobot Corp., raising questions about value and competition

Contract Overview

Contract Amount: $35,582,916 ($35.6M)

Contractor: Irobot Corporation

Awarding Agency: Department of Defense

Start Date: 2009-08-19

End Date: 2010-06-30

Contract Duration: 315 days

Daily Burn Rate: $113.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DELIVERY ORDER FOR FASTAC ROBORICS SYSTEMS.

Place of Performance

Location: BEDFORD, MIDDLESEX County, MASSACHUSETTS, 01730

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $35.6 million to IROBOT CORPORATION for work described as: DELIVERY ORDER FOR FASTAC ROBORICS SYSTEMS. Key points: 1. The contract's value of $35.6 million for robotics systems warrants scrutiny regarding its cost-effectiveness. 2. Full and open competition was utilized, but the number of bids received (3) may indicate limited market interest. 3. The fixed-price contract type shifts risk to the contractor, but performance monitoring is crucial. 4. This award falls within the 'All Other Miscellaneous General Purpose Machinery Manufacturing' NAICS code. 5. The short duration of the contract (approx. 10 months) suggests a specific, potentially urgent need. 6. The award to iRobot Corporation, a known consumer robotics company, raises questions about specialized defense needs.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without specific details on the robotics systems procured. However, a $35.6 million award for what appears to be a relatively short delivery period (less than a year) suggests a high per-unit cost or a significant quantity of systems. Comparing this to other defense robotics procurements would be necessary to determine if the pricing is competitive and reflects true value for money. The firm fixed-price nature is positive for budget certainty, but the overall value proposition depends heavily on the capabilities and utility of the delivered systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is generally a positive indicator for achieving competitive pricing. However, only three bids were received. This limited number of bidders could suggest that the market for these specific robotics systems is either niche, or that other potential suppliers were deterred by contract requirements, specifications, or perceived risks. A low number of bids can sometimes lead to less aggressive pricing than a more robustly competed contract.

Taxpayer Impact: While full and open competition was intended to benefit taxpayers, the low bid count may have limited the downward pressure on pricing, potentially resulting in a higher cost than if more companies had participated.

Public Impact

The Department of Defense is the primary beneficiary, receiving advanced robotics systems. The systems are intended for military applications, potentially enhancing operational capabilities. The geographic impact is likely concentrated within military operational areas. Workforce implications may include training for military personnel to operate and maintain the systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (3 bidders) may have resulted in suboptimal pricing for taxpayers.
The specific capabilities and intended use of the robotics systems are not detailed, making value assessment difficult.
iRobot Corporation's primary market is consumer robotics; its suitability for specialized defense applications warrants further investigation.
The short contract duration could indicate a rushed procurement or a pilot program, raising questions about long-term strategy.
Lack of information on performance metrics makes it difficult to assess the effectiveness of the delivered systems.

Positive Signals

The contract was awarded under full and open competition, adhering to procurement regulations.
The firm fixed-price contract type provides budget certainty for the Department of Defense.
iRobot Corporation is an established robotics manufacturer, suggesting a degree of technical capability.
The procurement addresses a need for robotics systems within the military.

Sector Analysis

This contract falls under the 'All Other Miscellaneous General Purpose Machinery Manufacturing' (NAICS 333999) sector. This broad category includes establishments primarily engaged in manufacturing machinery, not elsewhere classified. The defense sector frequently procures specialized machinery and equipment, including robotics, for various operational and logistical purposes. Spending in this sector can vary significantly based on technological advancements and specific military requirements. Comparable spending benchmarks would require analysis of other defense contracts for similar robotic platforms.

Small Business Impact

The data indicates that small business participation was not a factor in this award, as the 'sb' field is false and the 'ss' field is also false. This suggests that the contract was not set aside for small businesses, nor does it appear that small business subcontracting was a significant consideration. Consequently, the direct impact on the small business ecosystem from this specific contract is likely minimal, although iRobot Corporation itself may engage small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial management oversight structures. The Army Contracting Command, which awarded the contract, would have internal review processes. Inspector General (IG) jurisdiction would apply if allegations of fraud, waste, or abuse arise. Transparency is facilitated by contract databases like FPDS, but detailed performance reports and specific system capabilities are often not publicly disclosed for national security reasons.

Related Government Programs

Robotics Procurement
Unmanned Systems
Defense Logistics Equipment
General Purpose Machinery Manufacturing
Department of the Army Contracts

Risk Flags

Limited Competition
Unclear System Capabilities
Potential Overpricing
Contractor's Primary Market Focus

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $35.6 million to IROBOT CORPORATION. DELIVERY ORDER FOR FASTAC ROBORICS SYSTEMS.

Who is the contractor on this award?

The obligated recipient is IROBOT CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $35.6 million.

What is the period of performance?

Start: 2009-08-19. End: 2010-06-30.

What specific types of robotics systems were procured under this contract, and what are their intended military applications?

The provided data does not specify the exact types of robotics systems or their intended military applications. The contract is broadly categorized under 'DELIVERY ORDER FOR FASTAC ROBORICS SYSTEMS.' Given the awardee is iRobot Corporation, known for consumer robotics like the Roomba, the systems could range from reconnaissance or EOD (Explosive Ordnance Disposal) robots to potentially more specialized platforms. Without further details, it's difficult to ascertain their precise function, such as ground surveillance, hazardous material handling, or personnel support. The 'FASTAC' designation might refer to a specific program or initiative within the Army, but its meaning is not explicitly defined in the provided data.

How does the $35.6 million contract value compare to similar robotics system procurements by the Department of Defense?

Direct comparison of the $35.6 million contract value is difficult without knowing the specific capabilities and quantities of the robotics systems procured. However, defense robotics procurements can range widely. For instance, unmanned ground vehicles (UGVs) for military use can cost anywhere from tens of thousands to millions of dollars per unit, depending on sophistication, payload, and autonomy. A $35.6 million award for a delivery order suggests a substantial number of units or highly advanced systems. If this represents a purchase of numerous standard robots, it might be within a reasonable range. If it's for a smaller number of highly specialized units, it could be on the higher end, especially considering the relatively short performance period (ending June 30, 2010).

What is iRobot Corporation's track record in supplying robotics systems to the U.S. military, particularly for defense-specific applications?

iRobot Corporation has a history of supplying robots to the U.S. military, particularly for EOD and reconnaissance missions. Their PackBot platform, for instance, has been widely deployed in conflict zones for tasks such as bomb disposal and surveillance. While iRobot is primarily known for its consumer products, its defense and security division has provided ruggedized robots capable of operating in challenging environments. The $35.6 million contract suggests a significant engagement, potentially for a new or expanded deployment of their defense-oriented systems. However, assessing their track record requires looking beyond unit sales to the performance, reliability, and long-term support provided for these specialized defense applications.

Given the firm fixed-price contract type, what are the potential risks and benefits for the government and the contractor?

A Firm Fixed-Price (FFP) contract type offers significant benefits to the government by providing cost certainty; the price is set and generally not subject to adjustment based on the contractor's cost experience. This helps in budget management. For the contractor, the primary risk is that their actual costs exceed the fixed price, reducing or eliminating profit. Conversely, if they manage costs effectively, their profit margin can be higher. The benefit for the contractor is the potential for increased profit through efficiency. The main risk for the government under FFP is that the contractor might cut corners on quality or performance to protect their profit margin if costs run high, although this is mitigated by contract specifications and oversight. For this specific contract, the short duration might reduce the contractor's risk exposure.

How does the number of bidders (3) in this full and open competition impact price discovery and potential value for taxpayers?

A full and open competition ideally involves a robust number of bidders to foster strong price discovery and ensure the government receives the best possible value. With only three bidders responding to this solicitation, the competitive pressure may have been less intense than if, for example, five or more bids had been received. This limited competition could mean that the lowest price offered was not as low as it might have been in a more crowded field. Taxpayers could potentially have paid more than necessary if the limited number of bidders did not feel compelled to offer their most aggressive pricing. It also raises questions about why more potential suppliers did not participate, possibly indicating market limitations or specific barriers to entry for this particular procurement.

What is the historical spending pattern for robotics systems within the Department of Defense, and how does this contract fit?

Historical spending on robotics within the DoD has shown a consistent upward trend over the past two decades, driven by the need for unmanned systems in reconnaissance, logistics, and combat support roles, particularly following experiences in Iraq and Afghanistan. This $35.6 million contract, awarded in 2009 for delivery in 2010, fits within this pattern of increasing investment in robotic technologies. While specific figures fluctuate annually, the DoD consistently allocates billions towards various unmanned systems, including ground robots. This particular award represents a significant, albeit single, investment within that broader trend, likely contributing to the Army's growing inventory of robotic assets for operational use.

Industry Classification

NAICS: Manufacturing › Other General Purpose Machinery Manufacturing › All Other Miscellaneous General Purpose Machinery Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 63 SOUTH AVE, BURLINGTON, MA, 06

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $35,582,916

Exercised Options: $35,582,916

Current Obligation: $35,582,916

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W900KK08D0033

IDV Type: IDC

Timeline