DoD awards $2.23B for Aircraft Fixed Wing, with Northrop Grumman as sole contractor
Contract Overview
Contract Amount: $2,237,430,307 ($2.2B)
Contractor: Teledyne, Inc
Awarding Agency: Department of Defense
Start Date: 2001-03-16
End Date: 2022-12-20
Contract Duration: 7,949 days
Daily Burn Rate: $281.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: 200106!000169!5700!GU72 !ASC/RWKR !F3365701C4600 !A!N!*!N! !20010316!20030228!008391203!008255408!016435559!N!NORTHROP GRUMMAN CORPORATION !17066 GOLDENTOP ROAD !SAN DIEGO !CA!92127!59416!073!06!RANCHO BERNARDO !SAN DIEGO !CALIFORNIA!+000005500000!N!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !3000!NOT DISCERNABLE OR CLASSIFIED !336411!*!*!1! ! ! !*!*!*!B!*!*!A! !D !U!R!1!001!N!1G!Z!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!D!N! ! ! !Y! ! !0001!
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92127
Plain-Language Summary
Department of Defense obligated $2.24 billion to TELEDYNE, INC for work described as: 200106!000169!5700!GU72 !ASC/RWKR !F3365701C4600 !A!N!*!N! !20010316!20030228!008391203!008255408!016435559!N!NORTHROP GRUMMAN CORPORATION !17066 GOLDENTOP ROAD !SAN DIEGO !CA!92127!59416!073!06!RANCHO BERNARDO !SAN DIEGO !CALIFORNIA!+000005500000!N!N!000000000000!1510!AIRCRAFT F… Key points: 1. The contract value is substantial at over $2.23 billion. 2. Competition was limited, with Northrop Grumman being the sole source. 3. The risk of overpayment is moderate due to the cost-plus award fee structure. 4. This spending falls within the Defense sector, specifically aircraft manufacturing.
Value Assessment
Rating: fair
The contract value of $2.23 billion for aircraft manufacturing is significant. Benchmarking is difficult without specific unit details, but the duration and cost-plus nature suggest potential for cost escalation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating a lack of competitive bidding. This limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The sole-source nature of this large contract raises concerns about taxpayer value and whether a more competitive process could have secured better pricing.
Public Impact
Significant taxpayer funds allocated to a single defense contractor. Potential for reduced innovation and efficiency due to lack of competition. Impact on the defense industrial base and supply chain stability. Ensuring the delivered aircraft meet critical defense needs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Long contract duration
Positive Signals
- Critical defense procurement
- Established contractor with relevant experience
Sector Analysis
This contract is within the Defense sector, specifically for aircraft manufacturing. Spending in this area is driven by national security requirements and technological advancements in aviation.
Small Business Impact
There is no indication of small business participation in this sole-source contract. Efforts to include small businesses in subcontracting roles would be beneficial.
Oversight & Accountability
Oversight is crucial for sole-source, cost-plus contracts to ensure cost control and performance. The Defense Contract Management Agency's role is vital in monitoring this award.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Cost-plus award fee structure can lead to cost overruns.
- Long contract duration increases exposure to changing requirements and economic factors.
- Lack of transparency on specific aircraft models and their necessity.
- Potential for contractor lock-in.
Tags
aircraft-manufacturing, department-of-defense, ca, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $2.24 billion to TELEDYNE, INC. 200106!000169!5700!GU72 !ASC/RWKR !F3365701C4600 !A!N!*!N! !20010316!20030228!008391203!008255408!016435559!N!NORTHROP GRUMMAN CORPORATION !17066 GOLDENTOP ROAD !SAN DIEGO !CA!92127!59416!073!06!RANCHO BERNARDO !SAN DIEGO !CALIFORNIA!+000005500000!N!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !3000!NOT DISCERNABLE OR CLASSIFIED !336411!*!*!1! ! ! !*!*!*!B!*!*!A! !D !U!R!1!001!N!1G!Z!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!D!N! ! ! !Y! ! !0001!
Who is the contractor on this award?
The obligated recipient is TELEDYNE, 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 $2.24 billion.
What is the period of performance?
Start: 2001-03-16. End: 2022-12-20.
What specific aircraft are being procured under this contract, and what is their intended operational role?
The data specifies 'Aircraft Fixed Wing' and 'Airframes and Spares' under the PSC code 1510. The exact models and their specific roles within the Department of Defense are not detailed in this record. Further investigation into contract line items or associated documentation would be necessary to ascertain the precise aircraft types and their strategic or tactical applications.
Given the sole-source nature and cost-plus award fee structure, what mechanisms are in place to mitigate the risk of cost overruns and ensure fair pricing?
The cost-plus award fee (CPAF) structure inherently carries a risk of cost overruns. Mitigation relies heavily on robust government oversight, including detailed audits, performance monitoring against established award criteria, and negotiation of fee structures that incentivize efficiency. The Defense Contract Management Agency (DCMA) plays a critical role in this oversight.
How does this significant sole-source award impact the broader competitive landscape within the fixed-wing aircraft manufacturing sector for the DoD?
A large sole-source award can reduce opportunities for other potential contractors, potentially stifling competition and innovation in the long run. It may signal a reliance on a specific incumbent or a lack of viable alternatives for a particular capability. This could influence future market dynamics and the government's ability to secure competitive pricing on subsequent procurements.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: ATI Inc.
Address: 17066 GOLDENTOP ROAD, SAN DIEGO, CA, 92127
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $2,367,302,283
Exercised Options: $2,284,604,514
Current Obligation: $2,237,430,307
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2001-03-16
Current End Date: 2022-12-20
Potential End Date: 2022-12-20 00:00:00
Last Modified: 2022-08-17
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