DoD's $41.5M U-2 Optics Support Contract Awarded to Goodrich Corporation

Contract Overview

Contract Amount: $41,471,338 ($41.5M)

Contractor: Goodrich Corporation

Awarding Agency: Department of Defense

Start Date: 2016-11-01

End Date: 2017-10-31

Contract Duration: 364 days

Daily Burn Rate: $113.9K/day

Competition Type: NOT COMPETED

Pricing Type: COST NO FEE

Sector: Defense

Official Description: U-2 OPTICS SUPPORT AND SUSTAINMENT.

Place of Performance

Location: WESTFORD, MIDDLESEX County, MASSACHUSETTS, 01886

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $41.5 million to GOODRICH CORPORATION for work described as: U-2 OPTICS SUPPORT AND SUSTAINMENT. Key points: 1. Contract awarded for essential support and sustainment of U-2 aircraft optics. 2. Sole-source award raises questions about potential for competitive pricing. 3. Contract duration of one year suggests a focus on immediate needs or bridging. 4. The award falls under a Cost No Fee (CNF) contract type. 5. The specific Product Service Code (PSC) is not provided, limiting detailed analysis. 6. The contract's value is significant within its niche support category.

Value Assessment

Rating: fair

The contract value of approximately $41.5 million for a one-year period for optics support and sustainment for the U-2 program appears substantial. Without comparable contract data for similar niche systems, it is difficult to definitively benchmark value. The Cost No Fee (CNF) contract type, while sometimes used for specific R&D or urgent needs, can limit the government's ability to ensure cost efficiency compared to fixed-price or incentive-based contracts. Further analysis would require understanding the specific services rendered and the criticality of the U-2 optics.

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 among multiple vendors. This approach is typically justified when only one vendor possesses the necessary capabilities, technology, or proprietary knowledge to fulfill the requirement. The lack of competition means that the government did not benefit from a bidding process that could have potentially driven down prices or spurred innovation from multiple sources.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to ensure the most economical price is achieved.

Public Impact

The U.S. Air Force's intelligence, surveillance, and reconnaissance (ISR) capabilities are directly supported by the sustainment of U-2 optics. This contract ensures the continued operational readiness of a critical intelligence-gathering platform. The services provided are essential for maintaining the high-resolution imaging systems used by the U-2. The primary beneficiaries are the military branches relying on U-2 reconnaissance data for national security operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing opportunities.
Cost No Fee contract type may not incentivize cost efficiency.
Limited contract duration could indicate short-term or bridging support, requiring future procurements.
Lack of detailed service description hinders performance assessment.
No small business subcontracting goals were specified, potentially limiting small business participation.

Positive Signals

Contract ensures sustainment of critical U-2 optics, maintaining ISR capabilities.
Award to Goodrich Corporation, a known defense contractor, suggests established expertise.
The contract addresses a specific and essential component of a vital military platform.

Sector Analysis

The aerospace and defense sector is characterized by complex, high-value contracts for specialized equipment and services. The U-2 program, though aging, remains a critical asset for intelligence gathering, requiring ongoing support for its unique systems, including optics. Spending in this area is driven by national security requirements and the need to maintain the operational readiness of advanced platforms. Comparable spending benchmarks would typically involve sustainment contracts for other ISR platforms or specialized sensor systems.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements mentioned. As a sole-source award to a large prime contractor, the direct impact on small businesses is likely minimal unless Goodrich Corporation voluntarily engages them for specific support. Further investigation into Goodrich's subcontracting practices would be needed to assess broader small business ecosystem implications.

Oversight & Accountability

Oversight for this contract would fall under the Department of Defense's contracting and program management structures, likely involving the Defense Contract Management Agency (DCMA) for contract administration. The Cost No Fee (CNF) nature of the contract requires careful monitoring of costs incurred by the contractor to ensure they are reasonable and allowable, even without a direct profit motive. Transparency is limited by the sole-source nature and the lack of detailed public reporting on specific performance metrics.

Related Government Programs

U-2 Aircraft Sustainment Programs
ISR Platform Support Contracts
Aerospace Optics Manufacturing
Defense Intelligence Systems Support

Risk Flags

Sole-source award
Cost No Fee contract type
Limited contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $41.5 million to GOODRICH CORPORATION. U-2 OPTICS SUPPORT AND SUSTAINMENT.

Who is the contractor on this award?

The obligated recipient is GOODRICH CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $41.5 million.

What is the period of performance?

Start: 2016-11-01. End: 2017-10-31.

What is the track record of Goodrich Corporation in supporting U-2 aircraft systems, particularly optics?

Goodrich Corporation, now part of Collins Aerospace (a Raytheon Technologies company), has a long history of providing components and support for various military aircraft, including the U-2. Their expertise in aerospace systems, sensors, and optics makes them a logical choice for sustainment. While specific details on their U-2 optics support performance under this particular contract are not publicly detailed, their established presence in the defense sector suggests a baseline capability. Historical performance data for Goodrich on similar complex aerospace sustainment contracts would provide a more robust assessment, but such data is often proprietary or aggregated within broader program reviews.

How does the $41.5 million contract value compare to historical spending on U-2 optics support?

Direct historical spending comparisons for U-2 optics support are challenging to isolate from broader U-2 program sustainment costs in publicly available data. The $41.5 million awarded to Goodrich for a one-year period represents a significant investment in maintaining this critical component. Without access to detailed historical contract databases that specifically segment optics support from other U-2 sustainment activities (like airframe maintenance, engine support, or avionics), a precise year-over-year comparison is difficult. However, given the specialized nature of the U-2's sensor suite, annual sustainment costs for key components like optics are expected to be substantial, reflecting the complexity and criticality of the systems.

What are the primary risks associated with a sole-source award for critical U-2 optics sustainment?

The primary risk associated with a sole-source award for critical U-2 optics sustainment is the potential for inflated costs due to the lack of competitive bidding. Without competing vendors, taxpayers may be paying a premium for the services rendered. Another risk is vendor lock-in, where the government becomes overly reliant on a single provider, potentially limiting flexibility in future technology upgrades or alternative solutions. Furthermore, a sole-source award can reduce the incentive for the contractor to innovate or improve efficiency, as there is no direct competitive pressure to do so. Ensuring robust oversight and negotiation is crucial to mitigate these risks.

How effective is the Cost No Fee (CNF) contract type in ensuring value for money for this type of support?

The Cost No Fee (CNF) contract type is generally not considered the most effective for ensuring value for money in routine sustainment activities. CNF contracts reimburse the contractor for allowable costs but do not provide a profit margin. They are often used for research and development, urgent requirements where cost is secondary, or when the scope of work is highly uncertain. For sustainment, where performance metrics and cost efficiencies can often be defined, fixed-price or incentive-fee contracts typically offer better mechanisms for cost control and contractor performance motivation. The effectiveness of CNF in this case hinges heavily on the government's ability to rigorously audit and control the contractor's incurred costs.

What are the implications of the one-year duration for the U-2 optics sustainment program?

The one-year duration of this contract suggests it may be intended as a short-term solution, a bridge to a longer-term strategy, or a mechanism to procure immediate, critical support. This limited timeframe could imply that the government is reassessing its long-term needs for U-2 optics sustainment, exploring alternative technologies, or awaiting a more comprehensive program review. For taxpayers, a series of short-term contracts can sometimes be less cost-effective than a longer-term, strategically planned agreement, potentially involving higher administrative costs and less opportunity for economies of scale. It also necessitates continuous procurement planning and execution.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 7 TECHNOLOGY PARK DR, WESTFORD, MA, 01886

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: $41,586,338

Exercised Options: $41,586,338

Current Obligation: $41,471,338

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $405,531

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA852816D0008

IDV Type: IDC

Timeline