Raytheon Awarded $794.6M for Guided Missiles, Facing Limited Competition
Contract Overview
Contract Amount: $80,697,954 ($80.7M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2004-10-08
End Date: 2011-01-31
Contract Duration: 2,306 days
Daily Burn Rate: $35.0K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 200505!000020!5700!FA8213!OO-ALC/PKW/WMK !FA821304C0127 !A!N! !N! ! !20041008!20070731!794598573!794598573!001339159!N!RAYTHEON COMPANY !1151 E HERMANS RD !TUCSON !AZ!85706!77000!019!04!TUCSON !PIMA !ARIZONA !+000078221940!Y!N!000000000000!1410!GUIDED MISSILES !A6 !AMMUNITION !000 !* !336414!E! !3! ! ! ! ! !20200930!B! ! !N!Z!B!N!J!1!001!N!4A!A!Y!F! ! !N!C!N! ! ! !A!A!A!A!000!A!C!Y! ! ! ! ! ! !0001! !
Place of Performance
Location: TUCSON, PIMA County, ARIZONA, 85706
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $80.7 million to RAYTHEON COMPANY for work described as: 200505!000020!5700!FA8213!OO-ALC/PKW/WMK !FA821304C0127 !A!N! !N! ! !20041008!20070731!794598573!794598573!001339159!N!RAYTHEON COMPANY !1151 E HERMANS RD !TUCSON !AZ!85706!77000!019!04!TUCSON !PIMA… Key points: 1. Significant contract value of $794.6 million awarded to Raytheon Company. 2. Limited competition raises questions about price discovery and potential overspending. 3. The contract falls within the Guided Missile and Space Vehicle Manufacturing sector. 4. Long contract duration of 2306 days suggests a substantial, ongoing need.
Value Assessment
Rating: questionable
The contract value of $794.6 million for guided missiles needs comparison against similar, competitively awarded contracts. Without benchmarks, assessing value for money is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not available for competition, indicating a sole-source or limited source award. This significantly restricts price discovery and may lead to higher costs for taxpayers.
Taxpayer Impact: Limited competition can result in taxpayers paying a premium for goods and services, as competitive pressures to offer the best price are absent.
Public Impact
Taxpayers may be overpaying due to the lack of competitive bidding. The long-term nature of the contract impacts budget predictability for defense spending. Focus on a single provider could stifle innovation in missile technology.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Lack of price benchmarks
- Long contract duration
Positive Signals
- Clear need for guided missiles
- Established contractor
Sector Analysis
This contract is within the Guided Missile and Space Vehicle Manufacturing sector, a critical area for national defense. Spending in this sector is often high due to technological complexity and strategic importance.
Small Business Impact
There is no indication of small business participation in this contract award. Further analysis would be needed to determine if subcontracting opportunities were explored.
Oversight & Accountability
The limited competition aspect warrants scrutiny to ensure the government obtained the best possible value. Oversight should focus on justification for the limited competition and price reasonableness.
Related Government Programs
- Guided Missile and Space Vehicle Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Limited competition
- Potential for overpricing
- Lack of transparency in justification
- Long contract duration may reduce flexibility
Tags
guided-missile-and-space-vehicle-manufac, department-of-defense, az, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $80.7 million to RAYTHEON COMPANY. 200505!000020!5700!FA8213!OO-ALC/PKW/WMK !FA821304C0127 !A!N! !N! ! !20041008!20070731!794598573!794598573!001339159!N!RAYTHEON COMPANY !1151 E HERMANS RD !TUCSON !AZ!85706!77000!019!04!TUCSON !PIMA !ARIZONA !+000078221940!Y!N!000000000000!1410!GUIDED MISSILES !A6 !AMMUNITION !000 !* !336414!E! !3! ! ! ! ! !202
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
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 $80.7 million.
What is the period of performance?
Start: 2004-10-08. End: 2011-01-31.
What is the justification for limiting competition on this $794.6 million guided missile contract?
The provided data states the contract was 'NOT AVAILABLE FOR COMPETITION'. This typically implies a sole-source justification, such as a unique capability held by Raytheon, urgent need, or lack of viable alternatives. A thorough review of the justification documentation is necessary to validate this claim and ensure it aligns with federal procurement regulations.
How does the $794.6 million contract value compare to similar, competitively sourced guided missile procurements?
Without access to a database of comparable contracts, a direct benchmark is impossible. However, contracts awarded under full and open competition generally yield lower prices. The absence of competition here suggests this price may be higher than what could have been achieved through a competitive process, warranting further investigation into price reasonableness.
What is the potential impact of this long-term, limited-competition contract on future defense innovation?
A long-term contract with limited competition can reduce the incentive for the incumbent contractor to innovate aggressively if they are assured of continued business. It also limits opportunities for new entrants or smaller firms with potentially novel technologies to compete, potentially slowing overall advancement in the guided missile sector.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1151 E HERMANS RD, TUCSON, AZ, 90
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2004-10-08
Current End Date: 2011-01-31
Potential End Date: 2011-01-31 00:00:00
Last Modified: 2011-01-21
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