DoD awarded Northrop Grumman $11.3M for airborne radar equipment, a sole-source contract with a 3-year duration

Contract Overview

Contract Amount: $11,271,123 ($11.3M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2006-09-20

End Date: 2009-06-30

Contract Duration: 1,014 days

Daily Burn Rate: $11.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200612!002200!5700!FA8103!OC-ALC/LID !FA810306C0240 !A!N! !N! ! !20060920!20080930!091808832!008255408!016435559!N!NORTHROP GRUMMAN SYSTEMS CORPO!1580A NURSERY RD !LINTHICUM HEIG !MD!21090!47150!003!24!LINTHICUM HEIGHTS !ANNE ARUNDEL !MARYLAND !+000011299011!N!N!000000000000!5841!RADAR EQUIPMENT, AIRBORNE !A1C!OTHER AIRCRAFT EQUIPMENT !000 !NOT DISCERNABLE !336413!E! !3!C!S! ! ! !99990909!B! ! !A! !D!N!J!1!001!N!1G!A!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: LINTHICUM HEIGHTS, ANNE ARUNDEL County, MARYLAND, 21090

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $11.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: 200612!002200!5700!FA8103!OC-ALC/LID !FA810306C0240 !A!N! !N! ! !20060920!20080930!091808832!008255408!016435559!N!NORTHROP GRUMMAN SYSTEMS CORPO!1580A NURSERY RD !LINTHICUM HEIG !MD!21090!47150!003!24!LINTHICUM HEIGHTS !ANNE… Key points: 1. Contract awarded on a sole-source basis, raising questions about price competition and potential value for taxpayer dollars. 2. The contract's firm fixed-price structure offers cost certainty but may limit incentives for contractor efficiency. 3. Limited competition suggests potential risks of overpayment or suboptimal service delivery compared to a more open market. 4. The contract duration of approximately 3 years provides a stable period for delivery but limits flexibility for adjustments. 5. The award falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code, indicating a specialized industrial sector. 6. The contract was awarded by the Defense Logistics Agency, a key procurement arm for the Department of Defense.

Value Assessment

Rating: questionable

The contract value of $11.3 million for airborne radar equipment over approximately three years appears to be a significant investment. Without comparable sole-source contracts or detailed cost breakdowns, it is difficult to definitively benchmark the value for money. The firm fixed-price nature provides cost certainty for the government, but the lack of competition means there's no direct market comparison to assess if the price is truly competitive. Further analysis would be needed to understand the specific components and services included to make a more precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when only one vendor possesses the necessary capabilities, technology, or security clearances required for the specific product or service. The lack of competition means there were no other bidders to compare against, and the government did not benefit from the price discovery mechanisms inherent in a competitive bidding process.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as there is less pressure on the contractor to offer the most competitive pricing. This necessitates robust government oversight to ensure fair pricing and prevent potential overruns.

Public Impact

The primary beneficiary of this contract is the Department of Defense, specifically units requiring advanced airborne radar capabilities for operational readiness. The contract delivers critical airborne radar equipment, essential for surveillance, targeting, and situational awareness in military operations. The geographic impact is primarily within the defense sector's operational theaters, though manufacturing and support may occur at specific Northrop Grumman facilities. The contract supports specialized technical roles within Northrop Grumman, contributing to the defense industrial workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Lack of transparency in the justification for sole-source award.
Firm fixed-price contract may not incentivize contractor efficiency beyond meeting minimum requirements.
Contract duration of over three years may not be optimal if technology or requirements change rapidly.

Positive Signals

Firm fixed-price contract provides budget certainty for the government.
Award to a known defense contractor like Northrop Grumman suggests reliance on established capabilities.
Contract addresses a specific, likely critical, defense need for airborne radar.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on electronic warfare and radar systems. The market for airborne radar is highly specialized, dominated by a few large defense contractors with significant R&D investment and established government relationships. Spending in this area is driven by national security requirements and technological advancements in sensing and surveillance. Comparable spending benchmarks would likely involve other major defense contracts for similar sophisticated electronic systems.

Small Business Impact

This contract does not appear to have a small business set-aside component, as it was awarded to Northrop Grumman Systems Corporation, a large prime contractor. There is no explicit information regarding subcontracting plans for small businesses within this data. The focus on a sole-source award to a major corporation suggests that the primary objective was to secure specialized capabilities rather than to promote small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of Defense's contracting and program management offices, potentially including the Defense Contract Management Agency (DCMA). As a sole-source award, the justification and negotiation process would be subject to specific federal acquisition regulations. Transparency regarding the specific oversight mechanisms and accountability measures would require access to the contract file and associated documentation. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Airborne Surveillance and Reconnaissance Systems
Defense Electronics and Communication Systems
Military Aircraft Components
Advanced Radar Technology Development

Risk Flags

Sole-source award may indicate limited market availability or unique capabilities.
Contract duration extends beyond typical shorter-term procurements.
Awarded by DLA, a major logistics and procurement entity within DoD.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. 200612!002200!5700!FA8103!OC-ALC/LID !FA810306C0240 !A!N! !N! ! !20060920!20080930!091808832!008255408!016435559!N!NORTHROP GRUMMAN SYSTEMS CORPO!1580A NURSERY RD !LINTHICUM HEIG !MD!21090!47150!003!24!LINTHICUM HEIGHTS !ANNE ARUNDEL !MARYLAND !+000011299011!N!N!000000000000!5841!RADAR EQUIPMENT, AIRBORNE !A1C!OTHER AIRCRAFT EQUIPMENT !000 !NOT DISCERNABLE !336413!E! !3!C!S! ! ! !999

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $11.3 million.

What is the period of performance?

Start: 2006-09-20. End: 2009-06-30.

What is the specific type of airborne radar equipment being procured, and what are its key capabilities?

The data identifies the item as 'RADAR EQUIPMENT, AIRBORNE' under NAICS code 336413 (Other Aircraft Parts and Auxiliary Equipment Manufacturing). While the specific model or technical specifications are not detailed in this summary, airborne radar systems are typically used for a variety of military applications including surveillance, target detection and tracking, navigation, and electronic warfare. Given the sole-source nature and award to Northrop Grumman, it is likely a sophisticated system with advanced capabilities tailored to specific defense requirements, potentially involving high-resolution imaging, long-range detection, or specialized electronic countermeasures.

What was the justification for awarding this contract on a sole-source basis instead of competing it?

The provided data indicates the contract was 'NOT COMPETED'. Federal regulations permit sole-source awards under specific circumstances, such as when only one responsible source can provide the required supply or service, or when urgency, national security, or specific technological requirements preclude full and open competition. For this contract, the justification would likely stem from Northrop Grumman possessing unique technology, proprietary designs, or essential integration capabilities for this particular airborne radar system that other potential contractors do not possess. A formal justification document would typically be required and maintained by the contracting agency.

How does the contract's firm fixed-price (FFP) structure impact risk and potential cost savings for the government?

A Firm Fixed Price (FFP) contract, as indicated for this award, establishes a price that is not subject to adjustment based on the contractor's cost experience. This structure transfers most of the risk to the contractor, providing the government with cost certainty and predictability. For the government, this means the total expenditure is known upfront, simplifying budgeting. However, because the contractor bears the risk of cost overruns, they may build in a larger contingency into their initial price, potentially making the FFP price higher than it might be under a cost-reimbursement contract if costs were lower than anticipated. The lack of competition in this sole-source award further complicates assessing whether the FFP represents optimal value.

What is Northrop Grumman's track record with similar airborne radar systems or contracts with the Department of Defense?

Northrop Grumman Systems Corporation is a major defense contractor with extensive experience in aerospace and defense systems, including radar technology. They are known for developing and producing a wide range of advanced electronic warfare systems, sensors, and communication equipment for military applications. While this specific data point doesn't detail their past performance on identical contracts, their position as a prime contractor for the DoD suggests a history of delivering complex systems. Their portfolio includes various airborne radar platforms for different military branches, indicating a strong capability in this domain. Past performance reviews and contract histories within DoD databases would provide more granular detail on their specific track record.

What is the historical spending trend for airborne radar equipment by the Department of Defense or the Defense Logistics Agency?

Historical spending on airborne radar equipment by the Department of Defense (DoD) and its agencies like the Defense Logistics Agency (DLA) is substantial and fluctuates based on modernization programs, operational needs, and geopolitical factors. The DoD consistently invests billions annually in aviation systems, a significant portion of which includes advanced electronics like radar. DLA, responsible for logistics support, procures a wide array of parts and equipment, including those for aircraft systems. While this specific $11.3 million contract is a single data point, it represents ongoing investment in maintaining and upgrading critical airborne sensor capabilities. Broader trends show continuous demand for enhanced radar performance, including improved resolution, reduced size, weight, and power (SWaP), and greater electronic warfare resilience.

Are there any known risks associated with the performance or delivery timeline of this specific contract?

The provided data does not explicitly detail performance risks or delivery issues for this contract. However, general risks associated with sole-source contracts include potential complacency from the contractor regarding timely delivery or quality, as there is no competitive pressure. The contract duration of approximately three years (September 20, 2006, to June 30, 2009) is a moderate timeframe, but complex aerospace systems can encounter development or production delays. Without access to contract performance reports, inspection records, or modification history, a definitive risk assessment is not possible. The firm fixed-price nature might incentivize meeting deadlines to avoid losses, but the lack of competition remains a key factor.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Titan II Inc. (UEI: 016435559)

Address: 1580A NURSERY RD, LINTHICUM HEIG, MD

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: YES

Timeline