DoD's $2.2B ICBM Systems Engineering Contract Awarded to BAE Systems Under Full and Open Competition

Contract Overview

Contract Amount: $2,198,311,884 ($2.2B)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2013-08-01

End Date: 2026-07-31

Contract Duration: 4,747 days

Daily Burn Rate: $463.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIXED PRICE LEVEL OF EFFORT

Sector: Defense

Official Description: IGF::CL::IGF SYSTEMS ENGINEERING, INTEGRATION AND PROGRAM MANAGEMENT SUPPORT FOR THE ICBM SYSTEMS DIRECTORATE.

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $2.20 billion to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: IGF::CL::IGF SYSTEMS ENGINEERING, INTEGRATION AND PROGRAM MANAGEMENT SUPPORT FOR THE ICBM SYSTEMS DIRECTORATE. Key points: 1. The contract is for comprehensive engineering, integration, and program management support for the ICBM Systems Directorate. 2. BAE Systems Technology Solutions & Services Inc. is the sole awardee, indicating significant trust in their capabilities. 3. The fixed-price level-of-effort contract type suggests a focus on defined tasks with potential for cost overruns if effort exceeds estimates. 4. The significant value of $2.2 billion highlights the critical nature and long-term commitment to ICBM systems modernization.

Value Assessment

Rating: good

The contract value of $2.2 billion is substantial, reflecting complex and long-term support needs. Benchmarking against similar large-scale engineering and integration contracts for major defense systems is necessary to fully assess pricing, but the fixed-price level-of-effort structure aims for cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a robust process to identify the best value. This method typically leads to more competitive pricing and ensures a wide range of potential contractors were considered.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down costs through market forces, although the final cost depends on the defined scope and effort required.

Public Impact

Ensures continued modernization and sustainment of critical Intercontinental Ballistic Missile (ICBM) systems. Supports national security by maintaining the readiness of the strategic nuclear deterrent. Creates and sustains high-skilled jobs in engineering, program management, and technical support roles. Represents a significant long-term investment in defense infrastructure and technological advancement.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost growth if the level of effort required exceeds initial estimates.
Long contract duration (nearly 10 years) may lead to evolving technological requirements and potential obsolescence.
Concentration of critical ICBM support within a single contractor could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
BAE Systems is a well-established defense contractor with relevant expertise.
Contract aims to ensure the sustainment of a vital national security asset.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting complex defense systems. Spending in this area is often characterized by large, long-term contracts driven by national security requirements and technological evolution, with significant government oversight.

Small Business Impact

The data indicates that small businesses were not directly awarded this prime contract. However, BAE Systems, as the prime contractor, may engage small businesses as subcontractors for specialized services or components, contributing indirectly to the small business economy.

Oversight & Accountability

The contract's substantial value and long duration necessitate robust oversight from the Department of Defense and potentially the Inspector General to ensure performance, cost control, and adherence to contract terms. Regular reviews and audits are crucial for accountability.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Long-term dependency on a single contractor for critical ICBM support.
Potential for scope creep or increased effort beyond initial estimates in a level-of-effort contract.
Technological evolution over the contract's long duration may require significant adaptation.
Risk associated with the sustainment of aging, complex weapon systems.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $2.20 billion to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. IGF::CL::IGF SYSTEMS ENGINEERING, INTEGRATION AND PROGRAM MANAGEMENT SUPPORT FOR THE ICBM SYSTEMS DIRECTORATE.

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC..

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 $2.20 billion.

What is the period of performance?

Start: 2013-08-01. End: 2026-07-31.

What is the projected cost per year for this contract, and how does it compare to similar ICBM sustainment programs?

The total contract value is approximately $2.2 billion over a duration of nearly 10 years (4747 days). This averages to roughly $220 million per year. A detailed comparison with similar ICBM sustainment programs would require access to specific program data, but this annual figure appears substantial, reflecting the complexity and criticality of ICBM systems engineering and integration.

What are the specific performance metrics and key performance indicators (KPIs) used to evaluate BAE Systems' success under this contract?

The provided data does not detail the specific performance metrics or KPIs. However, for a contract of this nature and value, typical KPIs would likely include on-time delivery of milestones, adherence to technical specifications, system reliability and availability targets, and effective program management. Robust oversight mechanisms would be in place to track these metrics.

How will the government ensure that the 'level of effort' in this fixed-price contract remains appropriate and doesn't lead to excessive contractor work or costs?

The government will likely ensure appropriate effort through detailed work breakdown structures, regular progress reviews, and potentially independent government cost estimates. The fixed-price level-of-effort structure requires the contractor to perform a specified level of work, and the government monitors progress and deliverables to ensure the effort is justified and costs are managed within the contract's framework.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIXED PRICE LEVEL OF EFFORT (B)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ball Corporation

Address: 520 GAITHER ROAD, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $2,562,342,705

Exercised Options: $2,372,184,329

Current Obligation: $2,198,311,884

Actual Outlays: $33,441,949

Subaward Activity

Number of Subawards: 761

Total Subaward Amount: $495,711,434

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline