DoD Awards Northrop Grumman $6.7M for Explosives Manufacturing Amidst Limited Competition
Contract Overview
Contract Amount: $6,736,026 ($6.7M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2023-01-09
End Date: 2026-08-31
Contract Duration: 1,330 days
Daily Burn Rate: $5.1K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MJU-62 AND MJU-73 NSNS: 1377-01-658-5870 AND 1377-01-645-7400
Place of Performance
Location: CORINNE, BOX ELDER County, UTAH, 84307
State: Utah Government Spending
Plain-Language Summary
Department of Defense obligated $6.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: MJU-62 AND MJU-73 NSNS: 1377-01-658-5870 AND 1377-01-645-7400 Key points: 1. Contract awarded to a single, established provider in the explosives manufacturing sector. 2. Limited competition suggests potential for higher pricing and reduced innovation. 3. Risk of supply chain disruption if Northrop Grumman faces production issues. 4. Spending aligns with defense sector needs for specialized ordnance.
Value Assessment
Rating: fair
The awarded amount of $6.7M for a 3-year period appears reasonable given the specialized nature of explosives manufacturing. However, without a competitive bidding process, it's difficult to definitively assess if this represents the best value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This lack of competition limits price discovery and may result in a higher cost to the government than if multiple vendors had vied for the contract.
Taxpayer Impact: The absence of competition could lead to taxpayers paying a premium for these essential defense materials.
Public Impact
Ensures continued supply of critical explosives for Air Force operations. Supports a major defense contractor, potentially impacting regional employment. Highlights reliance on specialized, non-commercial manufacturing capabilities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Sole-source award
- Potential for price inflation
Positive Signals
- Ensures supply of critical defense material
- Long-term contract provides stability
Sector Analysis
This contract falls within the defense industrial base, specifically focusing on explosives manufacturing. Spending benchmarks for such specialized materials are difficult to establish due to proprietary processes and limited market participants.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corporation, a large defense contractor. There is no indication that small businesses were involved as subcontractors or partners in this specific award.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and performance. The Department of the Air Force should monitor contract execution diligently.
Related Government Programs
- Explosives Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for cost overruns due to lack of competitive pressure.
- Dependence on a single contractor for critical supplies.
- Lack of transparency in the procurement process.
Tags
explosives-manufacturing, department-of-defense, ut, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $6.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. MJU-62 AND MJU-73 NSNS: 1377-01-658-5870 AND 1377-01-645-7400
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
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 $6.7 million.
What is the period of performance?
Start: 2023-01-09. End: 2026-08-31.
What is the justification for the sole-source award, and what steps were taken to ensure the price is fair and reasonable?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. The government should have conducted a thorough price analysis, comparing the proposed costs to historical data, independent government estimates, or commercial price lists if available, to ensure the price is fair and reasonable despite the lack of competition.
What are the risks associated with relying on a single supplier for critical explosives, and are there contingency plans in place?
Relying on a single supplier for critical explosives poses risks such as supply chain disruptions due to production issues, geopolitical events, or the supplier's financial instability. Contingency plans might include maintaining strategic reserves, identifying potential alternative suppliers for future contracts, or developing in-house capabilities, though these are often costly and time-consuming.
How does this contract contribute to the overall readiness and operational effectiveness of the Department of the Air Force?
This contract directly contributes to the operational effectiveness of the Department of the Air Force by ensuring a consistent and reliable supply of essential explosives. This is crucial for training, mission execution, and maintaining the readiness of various weapon systems that depend on these materials for their functionality.
Industry Classification
NAICS: Manufacturing › Other Chemical Product and Preparation Manufacturing › Explosives Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
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: 9160 N HWY 83, CORINNE, UT, 84307
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $6,736,026
Exercised Options: $6,736,026
Current Obligation: $6,736,026
Subaward Activity
Number of Subawards: 17
Total Subaward Amount: $1,613,150
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA821321D0002
IDV Type: IDC
Timeline
Start Date: 2023-01-09
Current End Date: 2026-08-31
Potential End Date: 2026-08-31 00:00:00
Last Modified: 2025-12-10
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