Raytheon Awarded $21.3M for Ammunition Manufacturing, Lacking Competition
Contract Overview
Contract Amount: $21,316,473 ($21.3M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2010-07-22
End Date: 2012-07-31
Contract Duration: 740 days
Daily Burn Rate: $28.8K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: AMMUNITION (EXCEPT SMALL ARMS) MANUFACTURING
Place of Performance
Location: TUCSON, PIMA County, ARIZONA, 85756
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $21.3 million to RAYTHEON COMPANY for work described as: AMMUNITION (EXCEPT SMALL ARMS) MANUFACTURING Key points: 1. Significant contract awarded to a single large business. 2. No competitive bidding process was utilized. 3. Potential for inflated costs due to lack of competition. 4. Focus on ammunition manufacturing within the defense sector.
Value Assessment
Rating: questionable
The contract value of $21.3M for ammunition manufacturing is difficult to assess without comparable contracts. The 'NOT AVAILABLE FOR COMPETITION' status raises concerns about whether this price represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
This contract was not available for competition, indicating a sole-source or limited source award. This significantly limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competition means taxpayers may be paying more than necessary for these ammunition manufacturing services.
Public Impact
Taxpayers may be overpaying for essential defense supplies. Limited transparency in the procurement process. Potential impact on the readiness of military forces if costs are mismanaged.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Sole-source award
- Potential for cost overruns
Positive Signals
- Essential defense procurement
- Fixed-price contract type
Sector Analysis
This contract falls within the defense sector, specifically focusing on the manufacturing of ammunition. Defense spending on such critical supplies is substantial, and competitive bidding is crucial for cost efficiency.
Small Business Impact
The contract was awarded to Raytheon Company, a large business. There is no indication that small businesses were involved in this procurement, either as prime contractors or subcontractors.
Oversight & Accountability
The 'NOT AVAILABLE FOR COMPETITION' status suggests potential weaknesses in oversight or justification for bypassing competitive processes. Further review is needed to ensure accountability.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Sole-source award
- Potential for inflated pricing
- Limited transparency in procurement
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, az, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $21.3 million to RAYTHEON COMPANY. AMMUNITION (EXCEPT SMALL ARMS) MANUFACTURING
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 $21.3 million.
What is the period of performance?
Start: 2010-07-22. End: 2012-07-31.
What was the justification for not making this ammunition manufacturing contract available for competition?
The provided data states 'NOT AVAILABLE FOR COMPETITION' without further explanation. Typically, such justifications require detailed documentation, such as a sole-source justification or a determination of urgency, to ensure fair and efficient use of taxpayer funds.
How does the $21.3M contract value compare to industry benchmarks for similar ammunition manufacturing services?
Without specific details on the type and quantity of ammunition, a direct comparison is challenging. However, the lack of competition inherently raises concerns that the price may not be benchmarked against the most competitive market rates, potentially leading to a higher cost per unit than if multiple bids were solicited.
What are the long-term risks associated with awarding ammunition contracts without competition?
The primary long-term risk is the establishment of a precedent for non-competitive awards, leading to sustained higher costs for essential defense materials. It can also stifle innovation and reduce the overall capacity and responsiveness of the defense industrial base by limiting opportunities for other capable manufacturers.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
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, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $21,316,473
Exercised Options: $21,316,473
Current Obligation: $21,316,473
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2010-07-22
Current End Date: 2012-07-31
Potential End Date: 2012-07-31 00:00:00
Last Modified: 2012-05-01
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