DoD's Northrop Grumman Awarded $38.7M for B-2 PTU F3 Effort

Contract Overview

Contract Amount: $38,687,044 ($38.7M)

Contractor: Northrop Grumman Systems Corp

Awarding Agency: Department of Defense

Start Date: 2022-11-14

End Date: 2026-05-30

Contract Duration: 1,293 days

Daily Burn Rate: $29.9K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Defense

Official Description: CY23 B-2 PORT TRANSDUCER UNIT (PTU) PHASE II FORM, FIT, FUNCTION (F3) EFFORT

Place of Performance

Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93550

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $38.7 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: CY23 B-2 PORT TRANSDUCER UNIT (PTU) PHASE II FORM, FIT, FUNCTION (F3) EFFORT Key points: 1. Significant investment in critical aircraft component sustainment. 2. Sole-source award to Northrop Grumman, a major defense contractor. 3. Long-term contract (2022-2026) indicates complex, ongoing needs. 4. Cost-plus incentive fee contract structure aims to balance cost and performance.

Value Assessment

Rating: fair

The contract type (Cost Plus Incentive Fee) suggests potential for cost overruns, though incentives aim to mitigate this. Benchmarking is difficult without specific unit cost data for the transducer unit.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, raising questions about price discovery and whether alternative solutions were explored. Sole-source awards can limit competitive pressure on pricing.

Taxpayer Impact: Taxpayer funds are committed without competitive bidding, potentially leading to higher costs than a competed contract might achieve.

Public Impact

Ensures continued operational readiness of the B-2 bomber fleet. Supports advanced manufacturing and sustainment capabilities within a key defense contractor. Potential for cost growth due to the incentive fee structure. Limited transparency on the justification for a sole-source award.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost-plus contract type
Long contract duration

Positive Signals

Supports critical defense asset
Potential for performance incentives

Sector Analysis

Spending in the aircraft manufacturing sector, particularly for sustainment and upgrades of legacy platforms like the B-2, is substantial. This contract aligns with typical defense spending patterns for specialized components.

Small Business Impact

This contract was awarded to a large prime contractor, Northrop Grumman. There is no indication of small business participation in this specific award, though the prime may subcontract.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny to ensure the price is fair and reasonable. The Air Force should provide clear justification for the lack of competition.

Related Government Programs

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

Risk Flags

Lack of competition
Potential for cost overruns
Limited transparency on justification
Long contract duration may increase risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $38.7 million to NORTHROP GRUMMAN SYSTEMS CORP. CY23 B-2 PORT TRANSDUCER UNIT (PTU) PHASE II FORM, FIT, FUNCTION (F3) EFFORT

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 $38.7 million.

What is the period of performance?

Start: 2022-11-14. End: 2026-05-30.

What is the specific justification for awarding this contract on a sole-source basis, and were alternatives considered?

The provided data indicates a 'NOT COMPETED' status. A full justification would typically detail why competition was not feasible, such as unique capabilities, urgent need, or lack of viable alternatives. Without this documentation, it's difficult to assess if taxpayer funds were optimally used.

How does the cost-plus incentive fee structure compare to industry benchmarks for similar sustainment contracts?

Cost-plus incentive fee contracts are common in defense but can lead to higher costs if not managed tightly. Benchmarking requires detailed cost breakdowns and comparison with similar sustainment efforts for complex aerospace components, considering factors like R&D, production, and support.

What are the key performance metrics and targets within the incentive fee structure for this PTU effort?

The effectiveness of the incentive fee relies on clearly defined, measurable, and achievable performance targets related to the Form, Fit, and Function (F3) effort. These likely include technical performance, delivery schedules, and potentially cost control measures, crucial for ensuring the transducer unit meets stringent operational requirements.

Industry Classification

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

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS INCENTIVE FEE (V)

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: $39,910,972

Exercised Options: $39,910,972

Current Obligation: $38,687,044

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $356,000

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