DoD awards $23.9M for B-2 Special Test Equipment, with no competition

Contract Overview

Contract Amount: $23,872,920 ($23.9M)

Contractor: Northrop Grumman Systems Corp

Awarding Agency: Department of Defense

Start Date: 2021-10-01

End Date: 2025-03-31

Contract Duration: 1,277 days

Daily Burn Rate: $18.7K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: B-2 SPECIAL TEST EQUIPMENT (STE) INCREMENT 8

Place of Performance

Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93550

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $23.9 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: B-2 SPECIAL TEST EQUIPMENT (STE) INCREMENT 8 Key points: 1. Significant contract value for specialized aircraft components. 2. Sole-source award raises concerns about price discovery. 3. Long performance period may indicate complex requirements. 4. Focus on B-2 program suggests continued defense spending in this area.

Value Assessment

Rating: questionable

The contract is a Cost Plus Fixed Fee (CPFF) type, which can lead to cost overruns if not managed carefully. Without competitive bidding, it's difficult to assess if the fixed fee represents a fair return for the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to Northrop Grumman Systems Corp. This lack of competition limits price discovery and may result in higher costs for the government.

Taxpayer Impact: The absence of competition for this $23.9 million contract means taxpayers may be paying a premium for the B-2 Special Test Equipment.

Public Impact

Impacts the sustainment and modernization of the B-2 bomber fleet. Potential for higher costs due to sole-source nature. Highlights ongoing investment in legacy strategic aircraft programs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost-plus contract type
Lack of small business participation

Positive Signals

Supports critical defense platform
Long-term contract duration

Sector Analysis

This contract falls within the Defense sector, specifically Aircraft Manufacturing. Spending on specialized test equipment for legacy platforms like the B-2 is common but can be costly without competition.

Small Business Impact

The data indicates no small business participation in this contract. This is common for large, complex sole-source awards in the defense manufacturing sector, but it represents a missed opportunity for small businesses.

Oversight & Accountability

Oversight is crucial for CPFF contracts, especially sole-source ones, to ensure costs are reasonable and performance meets requirements. The Department of the Air Force is responsible for this oversight.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Sole-source award limits competition and price discovery.
Cost-plus contract type increases risk of cost overruns.
Lack of small business participation.
Long contract duration may mask inefficiencies.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.9 million to NORTHROP GRUMMAN SYSTEMS CORP. B-2 SPECIAL TEST EQUIPMENT (STE) INCREMENT 8

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $23.9 million.

What is the period of performance?

Start: 2021-10-01. End: 2025-03-31.

What is the justification for the sole-source award, and what steps are being taken to ensure fair pricing?

The justification for a sole-source award typically involves unique capabilities or proprietary technology held by a single contractor. The Department of Defense should have documentation outlining this rationale. For fair pricing, the Cost Plus Fixed Fee structure requires rigorous auditing and negotiation of the fixed fee component to ensure it aligns with the contractor's effort and risk.

What is the projected cost growth potential for this Cost Plus Fixed Fee contract?

Cost Plus Fixed Fee contracts carry inherent risks of cost growth, as the contractor is reimbursed for all allowable costs plus a fixed fee. Without competitive pressure, the contractor may have less incentive to control costs. Effective oversight, detailed cost tracking, and robust negotiation of the fixed fee are essential to mitigate potential overruns and protect taxpayer funds.

How does this spending align with the overall modernization strategy for the B-2 fleet?

This spending on Special Test Equipment (STE) likely supports the ongoing sustainment and potential upgrades of the B-2 bomber fleet. STE is critical for diagnosing, maintaining, and testing complex aircraft systems. Understanding how this investment fits into the broader strategic goals for the B-2 program would provide context on its long-term necessity and effectiveness.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 3520 E AVE M, PALMDALE, CA, 93550

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

Financial Breakdown

Contract Ceiling: $23,872,920

Exercised Options: $23,872,920

Current Obligation: $23,872,920

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA861614D6060

IDV Type: IDC

Timeline