DoD Awards $157M for B-2 STE to Northrop Grumman, Lacking Competition
Contract Overview
Contract Amount: $15,729,684 ($15.7M)
Contractor: Northrop Grumman Systems Corp
Awarding Agency: Department of Defense
Start Date: 2024-12-20
End Date: 2027-03-31
Contract Duration: 831 days
Daily Burn Rate: $18.9K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: B-2 CY24 SPECIAL TEST EQUIPMENT (STE)
Place of Performance
Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93550
Plain-Language Summary
Department of Defense obligated $15.7 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: B-2 CY24 SPECIAL TEST EQUIPMENT (STE) Key points: 1. Significant contract value of $157.3 million for specialized test equipment. 2. Sole-source award to Northrop Grumman raises questions about competitive pricing. 3. Long contract duration (2024-2027) for STE may indicate complex requirements. 4. Focus on Aircraft Manufacturing sector, specifically for the B-2 program.
Value Assessment
Rating: questionable
The contract value of $157.3 million for Special Test Equipment (STE) is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to similar specialized equipment contracts.
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 potentially leads to higher costs for taxpayers.
Taxpayer Impact: The absence of competition for a $157.3 million contract means taxpayers may be paying a premium, as there was no market pressure to drive down costs.
Public Impact
Taxpayers may be overpaying due to the lack of competitive bidding. The B-2 program's reliance on a single contractor for critical STE could pose a long-term risk. Transparency in the sole-source justification is crucial for public trust.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High contract value
Positive Signals
- Critical equipment for B-2 program
- Long-term contract provides stability
Sector Analysis
This contract falls within the Defense sector, specifically supporting the Aircraft Manufacturing industry for the B-2 bomber program. Spending benchmarks for specialized test equipment can vary widely based on complexity and program maturity.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corp, a large business. There is no indication that small businesses were involved in this specific sole-source award, limiting their participation.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the price is fair and reasonable. The Department of the Air Force must provide clear justification for not competing this requirement.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award
- Lack of competitive bidding
- Potential for overpricing
- Limited transparency on justification
- Dependency on a single supplier
Tags
aircraft-manufacturing, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.7 million to NORTHROP GRUMMAN SYSTEMS CORP. B-2 CY24 SPECIAL TEST EQUIPMENT (STE)
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 $15.7 million.
What is the period of performance?
Start: 2024-12-20. End: 2027-03-31.
What is the justification for awarding this significant contract solely to Northrop Grumman without competition?
The justification for a sole-source award typically centers on unique capabilities, proprietary technology, or the need for compatibility with existing systems where only one contractor can fulfill the requirement. For the B-2 STE, it's likely tied to the specific, complex systems of the aircraft, which Northrop Grumman, as the prime contractor, would possess intimate knowledge of and access to necessary technical data.
What are the potential risks associated with a sole-source contract of this magnitude for specialized equipment?
The primary risk is inflated pricing due to the absence of competitive pressure. Other risks include potential complacency from the contractor regarding quality or delivery timelines, and a lack of innovation that might arise from competition. Furthermore, it creates a dependency on a single supplier, which can be problematic if that supplier faces financial or operational difficulties.
How does this contract contribute to the overall effectiveness and sustainment of the B-2 bomber program?
Special Test Equipment (STE) is crucial for maintaining, diagnosing, and repairing the complex systems of the B-2 bomber. This contract ensures that the necessary tools and equipment are available, directly supporting the operational readiness and effectiveness of the aircraft. Without adequate STE, the Air Force would face significant challenges in keeping the B-2 fleet mission-capable.
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: FIRM FIXED PRICE (J)
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: $15,729,684
Exercised Options: $15,729,684
Current Obligation: $15,729,684
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $11,647,263
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
Start Date: 2024-12-20
Current End Date: 2027-03-31
Potential End Date: 2027-03-31 00:00:00
Last Modified: 2025-12-10
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