DoD awards $57M for U-2 AN/ASQ-230 support, a sole-source contract to Northrop Grumman
Contract Overview
Contract Amount: $57,089,193 ($57.1M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2020-12-23
End Date: 2024-05-31
Contract Duration: 1,255 days
Daily Burn Rate: $45.5K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: U-2 AN/ASQ-230 SUPPORT AND SERVICE
Place of Performance
Location: SAN JOSE, SANTA CLARA County, CALIFORNIA, 95119
Plain-Language Summary
Department of Defense obligated $57.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: U-2 AN/ASQ-230 SUPPORT AND SERVICE Key points: 1. Contract awarded to incumbent Northrop Grumman for critical U-2 aircraft support. 2. Sole-source award raises concerns about price discovery and potential overpayment. 3. High value contract for specialized aerospace systems manufacturing. 4. Limited competition may impact innovation and cost-effectiveness. 5. Long contract duration (1255 days) requires ongoing scrutiny.
Value Assessment
Rating: questionable
The contract value of $57M for support and service of the U-2 AN/ASQ-230 system is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market alternatives or previous contract pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Northrop Grumman, was solicited. This significantly limits price discovery and competition, potentially leading to higher costs for taxpayers.
Taxpayer Impact: The lack of competition for this significant contract may result in taxpayers paying a premium for the U-2 support services.
Public Impact
Ensures continued operational readiness of the U-2 reconnaissance aircraft. Supports advanced aerospace technology and manufacturing capabilities. Potential for increased costs due to sole-source nature. Impacts the supply chain for specialized defense components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Limited price transparency
Positive Signals
- Ensures critical system support
- Supports incumbent technology
Sector Analysis
The Department of Defense frequently awards large contracts for aerospace systems and components. This contract falls within the Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing sector, which often involves high-value, specialized work.
Small Business Impact
This contract was awarded directly to Northrop Grumman Systems Corporation, a large prime contractor. There is no indication of subcontracting opportunities for small businesses within the provided data, suggesting limited direct small business involvement.
Oversight & Accountability
The sole-source nature of this award warrants close oversight from the Department of Defense to ensure fair pricing and prevent potential cost overruns. Robust auditing and performance monitoring are crucial.
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 due to lack of competition.
- Limited transparency on cost justification.
- Long contract duration requires sustained oversight.
- Dependency on a single contractor for critical support.
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 $57.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. U-2 AN/ASQ-230 SUPPORT AND SERVICE
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 $57.1 million.
What is the period of performance?
Start: 2020-12-23. End: 2024-05-31.
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. The Air Force would need to provide documentation detailing why Northrop Grumman was the only viable option and if any market research was conducted to explore competitive possibilities before making this determination.
How does the pricing of this contract compare to similar support contracts for other advanced reconnaissance platforms?
Benchmarking this contract's pricing against similar support services for comparable advanced reconnaissance platforms is challenging due to the sole-source nature and lack of public cost data. A thorough analysis would require access to detailed cost breakdowns and potentially classified information on other contracts to ensure fair and reasonable pricing.
What measures are in place to ensure the effectiveness and efficiency of the support and services provided by Northrop Grumman?
Effectiveness and efficiency are typically ensured through performance metrics, service level agreements (SLAs), and regular reviews outlined in the contract. The Air Force should be actively monitoring Northrop Grumman's performance against these benchmarks and addressing any deficiencies promptly to guarantee the U-2 system's operational readiness.
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
Parent Company: Northrop Grumman Corporation
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: $57,957,193
Exercised Options: $57,957,193
Current Obligation: $57,089,193
Subaward Activity
Number of Subawards: 107
Total Subaward Amount: $14,770,623
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: 2020-12-23
Current End Date: 2024-05-31
Potential End Date: 2024-05-31 00:00:00
Last Modified: 2024-05-03
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