DoD Awards $16.9M for LAIRCM AAQ-24 Repairs to Northrop Grumman, Lacking Competition
Contract Overview
Contract Amount: $16,912,070 ($16.9M)
Contractor: Northrop Grumman Systems Corp
Awarding Agency: Department of Defense
Start Date: 2024-08-30
End Date: 2026-03-31
Contract Duration: 578 days
Daily Burn Rate: $29.3K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: LAIRCM AAQ-24 REPAIRS
Place of Performance
Location: WARNER ROBINS, HOUSTON County, GEORGIA, 31088
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $16.9 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: LAIRCM AAQ-24 REPAIRS Key points: 1. Significant contract value for specialized aircraft system repairs. 2. Sole-source award to Northrop Grumman raises competition concerns. 3. Potential for inflated costs due to lack of competitive bidding. 4. Focus on defense sector, specifically electronic and precision equipment maintenance.
Value Assessment
Rating: questionable
The $16.9M award for LAIRCM AAQ-24 repairs appears high given the lack of competition. Benchmarking against similar specialized defense equipment repair contracts would be necessary to definitively assess value, but the sole-source nature suggests potential overpricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to offer competitive pricing.
Taxpayer Impact: The lack of competition on this $16.9M contract means taxpayers may be paying more than necessary for these critical repairs.
Public Impact
Ensures continued operational readiness of critical defense aircraft systems. Supports specialized maintenance capabilities within the defense industrial base. Potential for taxpayer funds to be used inefficiently due to sole-source award.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
Positive Signals
- Maintains critical defense capability
- Supports specialized repair services
Sector Analysis
This contract falls within the defense sector, specifically focusing on the maintenance and repair of electronic and precision equipment for aircraft. Spending in this area is critical for national security but requires careful oversight to ensure cost-effectiveness.
Small Business Impact
The awardee, Northrop Grumman Systems Corp, is a large defense contractor. There is no indication that small businesses were involved in this specific sole-source award, limiting opportunities for them in this instance.
Oversight & Accountability
The sole-source nature of this award warrants close oversight by the Department of Defense and the Defense Contract Management Agency to ensure the pricing is fair and reasonable and that the repairs are performed effectively.
Related Government Programs
- Electronic and Precision Equipment Repair and Maintenance
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Potential for inflated costs due to lack of competitive pressure.
- High contract value warrants scrutiny of pricing and performance.
- Reliance on a single contractor for critical repairs poses a risk.
Tags
electronic-and-precision-equipment-repai, department-of-defense, ga, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.9 million to NORTHROP GRUMMAN SYSTEMS CORP. LAIRCM AAQ-24 REPAIRS
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 (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $16.9 million.
What is the period of performance?
Start: 2024-08-30. End: 2026-03-31.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. For this contract, the agency should provide detailed documentation explaining why Northrop Grumman was the only viable option and what steps, if any, were taken to explore competitive avenues before resorting to a sole-source procurement.
How will the agency ensure cost-effectiveness and prevent potential overpricing given the lack of competition?
To mitigate the risk of overpricing in a sole-source scenario, the agency should employ robust cost analysis techniques, including detailed review of the contractor's proposed costs, comparison with historical data for similar repairs, and potentially engaging independent cost estimators. Strong contract surveillance and performance monitoring are also crucial to ensure value for money.
What is the long-term strategy for ensuring competitive sourcing for future LAIRCM AAQ-24 repair needs?
The agency should develop a long-term strategy to foster competition for future repair needs. This could involve breaking down the requirement into smaller, more manageable contracts, encouraging new market entrants, or investing in organic government capabilities if feasible. Proactive market research and planning are essential to avoid recurring sole-source awards.
Industry Classification
NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Electronic and Precision Equipment Repair and Maintenance
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: 101 INDUSTRIAL PARK BLVD, WARNER ROBINS, GA, 31088
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: $16,912,070
Exercised Options: $16,912,070
Current Obligation: $16,912,070
Subaward Activity
Number of Subawards: 2
Total Subaward Amount: $1,116,657
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA852224D0004
IDV Type: IDC
Timeline
Start Date: 2024-08-30
Current End Date: 2026-03-31
Potential End Date: 2026-03-31 00:00:00
Last Modified: 2025-12-18
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