DoD Awards Northrop Grumman $35.9M for AN/ASQ-230 Support, Lacking Competition
Contract Overview
Contract Amount: $35,903,701 ($35.9M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2019-12-20
End Date: 2024-03-01
Contract Duration: 1,533 days
Daily Burn Rate: $23.4K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: AN/ASQ-230 SUPPORT AND SUSTAINMENT
Place of Performance
Location: LOS GATOS, SANTA CLARA County, CALIFORNIA, 95032
Plain-Language Summary
Department of Defense obligated $35.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: AN/ASQ-230 SUPPORT AND SUSTAINMENT Key points: 1. Significant contract value awarded to a single vendor. 2. Lack of competition raises concerns about potential overpricing. 3. The contract supports critical search and navigation systems. 4. No small business participation noted.
Value Assessment
Rating: questionable
The contract's value of $35.9M for support and sustainment needs further scrutiny given the lack of competitive bidding. Benchmarking against similar sustainment contracts for complex avionics systems is recommended to assess pricing fairness.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Northrop Grumman. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive environment.
Taxpayer Impact: The absence of competition may result in inflated costs, impacting taxpayer value for essential defense systems.
Public Impact
Ensures continued operation of critical Air Force navigation and search systems. Potential for higher costs due to sole-source award affects defense budget allocation. Lack of transparency in pricing due to non-competitive nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- No small business participation
- Limited price transparency
Positive Signals
- Ensures sustainment of critical equipment
Sector Analysis
This contract falls within the aerospace and defense sector, specifically for the manufacturing and support of navigation and guidance systems. Spending in this area is critical for national security, but competitive sourcing is vital for cost efficiency.
Small Business Impact
The contract data indicates no small business participation. This represents a missed opportunity to engage small businesses in the defense supply chain and could indicate a lack of outreach or specific requirements that favor large contractors.
Oversight & Accountability
The sole-source nature of this award warrants closer oversight to ensure fair pricing and performance. The Department of Defense should provide justification for the lack of competition and outline steps to encourage future competition.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits competition
- Potential for inflated pricing
- No small business participation
- Lack of price transparency
Tags
search-detection-navigation-guidance-aer, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $35.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. AN/ASQ-230 SUPPORT AND SUSTAINMENT
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 $35.9 million.
What is the period of performance?
Start: 2019-12-20. End: 2024-03-01.
What is the justification for awarding this contract on a sole-source basis, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. To ensure fair pricing, the agency should conduct a thorough price analysis, potentially using historical data, cost realism assessments, or independent government cost estimates. Transparency regarding the justification and pricing analysis is crucial for accountability.
What are the risks associated with relying on a single vendor for the sustainment of critical AN/ASQ-230 components?
Relying on a single vendor for sustainment creates significant risks, including potential price escalation due to lack of competition, vendor lock-in, and supply chain disruptions if the vendor faces financial or operational issues. It also limits the government's ability to leverage innovation or cost-saving measures from alternative providers, potentially impacting long-term readiness and budget predictability.
How does the lack of competition impact the overall effectiveness and value for money for this defense spending?
The lack of competition directly undermines the government's ability to achieve the best possible value for money. Without competitive pressure, the awarded price may not reflect the most efficient cost structure, potentially leading to overspending. This can reduce the overall effectiveness of the defense budget by diverting funds that could be used for other critical needs or acquisitions.
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: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6379 SAN IGNACIO AVE, SAN JOSE, CA, 95119
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: $37,478,836
Exercised Options: $37,478,836
Current Obligation: $35,903,701
Subaward Activity
Number of Subawards: 242
Total Subaward Amount: $36,400,731
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA852817D0013
IDV Type: IDC
Timeline
Start Date: 2019-12-20
Current End Date: 2024-03-01
Potential End Date: 2024-03-01 00:00:00
Last Modified: 2025-09-03
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