DoD Awards $14.6M for B-2 Repair Operations to Northrop Grumman, Raising Oversight Concerns

Contract Overview

Contract Amount: $14,568,811 ($14.6M)

Contractor: Northrop Grumman Systems Corp

Awarding Agency: Department of Defense

Start Date: 2025-06-03

End Date: 2026-02-28

Contract Duration: 270 days

Daily Burn Rate: $54.0K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: CY25 B-2 REPAIR OPERATIONS (BRO)

Place of Performance

Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93550

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $14.6 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: CY25 B-2 REPAIR OPERATIONS (BRO) Key points: 1. Significant contract value for specialized aircraft maintenance. 2. Sole-source award to incumbent contractor limits competitive pricing. 3. Potential for cost overruns due to Cost Plus Fixed Fee structure. 4. Focus on critical defense asset sustainment.

Value Assessment

Rating: questionable

The $14.6 million award for B-2 repair operations is a substantial sum. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar specialized aircraft maintenance services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis to Northrop Grumman Systems Corp. This lack of competition limits price discovery and may result in higher costs for taxpayers, as there was no opportunity to explore alternative providers or negotiate more aggressively.

Taxpayer Impact: The sole-source nature of this award means taxpayers may not be receiving the best possible value, as competitive pressures that typically drive down costs are absent.

Public Impact

Ensures continued operational readiness of the B-2 bomber fleet. Supports critical national defense capabilities. Maintains specialized technical expertise within a single contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of small business participation indicated

Positive Signals

Supports critical defense asset
Incumbent contractor expertise

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft maintenance and repair. Spending benchmarks in this area are highly specialized and often dominated by a few key contractors due to the complexity and proprietary nature of the systems.

Small Business Impact

The data indicates no explicit small business participation (sb: false). This suggests that the prime contractor, Northrop Grumman, is handling the entirety of this specialized repair work, potentially missing opportunities to engage smaller, specialized firms.

Oversight & Accountability

The sole-source award and Cost Plus Fixed Fee structure warrant close oversight to ensure costs remain reasonable and that the contractor is performing efficiently. Robust auditing and performance monitoring will be crucial.

Related Government Programs

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

Risk Flags

Sole-source award limits competition and potential cost savings.
Cost Plus Fixed Fee contract type may incentivize higher spending.
Lack of small business participation noted.
High degree of contractor dependency for critical asset sustainment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.6 million to NORTHROP GRUMMAN SYSTEMS CORP. CY25 B-2 REPAIR OPERATIONS (BRO)

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 $14.6 million.

What is the period of performance?

Start: 2025-06-03. End: 2026-02-28.

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 relates to unique capabilities, proprietary technology, or essential system sustainment where only one contractor can provide the required services. To ensure fair pricing, the agency should conduct thorough cost analyses, benchmark against historical data, and potentially negotiate specific cost controls or incentive structures within the Cost Plus Fixed Fee agreement.

What are the potential risks associated with a Cost Plus Fixed Fee contract for specialized aircraft repair?

Cost Plus Fixed Fee (CPFF) contracts carry inherent risks for the government. The contractor is reimbursed for all allowable costs plus a predetermined fixed fee. This structure can incentivize cost overruns, as the contractor may not be as motivated to control expenses when costs are covered. For specialized repairs, the complexity can make it difficult to accurately estimate costs upfront, potentially leading to budget challenges and reduced value for taxpayer money.

How does this contract contribute to the overall effectiveness and readiness of the B-2 fleet?

This contract is crucial for maintaining the operational readiness and effectiveness of the B-2 bomber fleet. By ensuring necessary repairs and maintenance are performed by the original manufacturer or a highly specialized entity, the contract directly supports the platform's ability to execute its strategic mission. The timely completion of these operations is vital for national security.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

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 AVENUE M, PALMDALE, CA, 93550

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

Financial Breakdown

Contract Ceiling: $14,568,811

Exercised Options: $14,568,811

Current Obligation: $14,568,811

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA861624DB001

IDV Type: IDC

Timeline