DoD awards $28.3M to BAE Systems for U-2 Electronic Warfare Suite sustainment through April 2025

Contract Overview

Contract Amount: $28,252,588 ($28.3M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2021-06-29

End Date: 2025-04-30

Contract Duration: 1,401 days

Daily Burn Rate: $20.2K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SUPPORT AND SUSTAINMENT OF THE U-2 AN/ALQ-221 ELECTRONIC WARFARE SUITE.

Place of Performance

Location: NASHUA, HILLSBOROUGH County, NEW HAMPSHIRE, 03060

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $28.3 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: SUPPORT AND SUSTAINMENT OF THE U-2 AN/ALQ-221 ELECTRONIC WARFARE SUITE. Key points: 1. Contract focuses on essential sustainment and support for a critical electronic warfare system. 2. Sole-source award raises questions about competition and potential cost efficiencies. 3. Long-term contract duration (over 3 years) suggests a need for stable, ongoing support. 4. The U-2 platform's continued operational relevance influences the importance of this contract. 5. BAE Systems is a major defense contractor with extensive experience in EW systems. 6. Fixed-price contract type aims to control costs, but sole-source nature limits price discovery.

Value Assessment

Rating: fair

Benchmarking the value of this sole-source contract is challenging without competitive data. The $28.3 million award over approximately 3.8 years (from June 2021 to April 2025) averages around $7.4 million annually. This figure needs to be compared against historical sustainment costs for similar EW suites or against BAE Systems' own previous pricing for this system to assess value for money. The firm fixed-price structure provides some cost certainty, but the lack of competition prevents robust price discovery.

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 typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition limits the government's ability to leverage market forces to achieve the lowest possible price and may indicate a reliance on a single supplier for this critical system.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive bidding. Without competing offers, it is difficult to ascertain if the price reflects the best value achievable in a competitive market.

Public Impact

The primary beneficiaries are the U.S. Air Force units operating the U-2 reconnaissance aircraft, ensuring the continued functionality of their electronic warfare capabilities. The contract delivers essential sustainment, maintenance, and support services for the AN/ALQ-221 Electronic Warfare Suite. Geographic impact is likely concentrated around U-2 operating bases, though the supply chain for sustainment may be broader. Workforce implications include the need for specialized technical personnel at BAE Systems and potentially within the Air Force for system oversight and integration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Long-term sustainment contracts can sometimes lead to vendor lock-in.
Reliance on a single provider for critical EW components poses a supply chain risk.
The aging U-2 platform may present unique sustainment challenges.

Positive Signals

Firm fixed-price contract provides cost predictability for the government.
BAE Systems is an established defense contractor with proven expertise in EW.
Sustainment ensures the continued operational readiness of a vital intelligence-gathering platform.
The contract supports the U-2, a platform with a long and distinguished service record.

Sector Analysis

The defense electronics market, particularly electronic warfare (EW) systems, is a highly specialized and critical sector within the broader aerospace and defense industry. This contract falls under the Engineering Services NAICS code (541330). The market is characterized by high barriers to entry due to technological complexity, stringent security requirements, and long development cycles. Major defense contractors like BAE Systems dominate this space. Spending on EW systems is driven by the need for advanced threat detection, jamming, and countermeasures, essential for maintaining air superiority and survivability in contested environments. Comparable spending benchmarks would involve analyzing sustainment contracts for other EW suites on different platforms.

Small Business Impact

This contract does not appear to involve a small business set-aside, as indicated by 'sb: false'. BAE Systems is a large defense contractor. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem for this particular award is unclear, though large prime contractors often utilize small businesses in their supply chains.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force contracting and program management offices. As a Department of Defense contract, it is subject to oversight by the DoD Inspector General. Transparency is facilitated through contract databases like FPDS, although the level of detail on performance metrics and specific sustainment activities may be limited in public disclosures. Accountability rests with BAE Systems to meet the terms of the firm fixed-price contract and with the Air Force to monitor performance and ensure compliance.

Related Government Programs

U-2 Aircraft Sustainment
Electronic Warfare Systems Procurement
Air Force Intelligence, Surveillance, and Reconnaissance (ISR) Programs
BAE Systems Defense Contracts
Aerospace Engineering Services

Risk Flags

Sole Source Award
Potential for Cost Overruns
Limited Competition
Long-Term Contractor Dependence

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.3 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. SUPPORT AND SUSTAINMENT OF THE U-2 AN/ALQ-221 ELECTRONIC WARFARE SUITE.

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION 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 $28.3 million.

What is the period of performance?

Start: 2021-06-29. End: 2025-04-30.

What is BAE Systems' track record with the AN/ALQ-221 EW suite and similar systems?

BAE Systems Information and Electronic Systems Integration Inc. has a long history of developing and supporting electronic warfare systems for various military platforms. They are a prime contractor for numerous EW programs, including systems for aircraft, ships, and ground vehicles. Their experience with the AN/ALQ-221 specifically likely stems from prior development, integration, or sustainment contracts related to the U-2 program. A review of their contract history would reveal the extent of their involvement and performance on previous related efforts. Generally, BAE Systems is considered a capable provider in the EW domain, though specific performance metrics on individual contracts would be needed for a complete assessment.

How does the annual cost of this contract compare to other EW suite sustainment efforts?

The annual cost for this contract averages approximately $7.4 million ($28.3M / ~3.8 years). Comparing this figure directly to other EW suite sustainment efforts requires access to data on similar systems, considering factors like system complexity, age, number of components, and the scope of sustainment (e.g., depot-level maintenance, software updates, component repair). Without specific benchmarks for comparable EW suites on platforms like the F-16, F-15, or other reconnaissance aircraft, it's difficult to definitively state if this represents a high, low, or average cost. However, given the specialized nature of EW and the U-2 platform, this annual figure may fall within a reasonable range for dedicated sustainment, pending further comparative analysis.

What are the primary risks associated with relying on a sole-source provider for EW system sustainment?

The primary risks associated with a sole-source award for EW system sustainment include potential price inflation due to lack of competition, reduced incentive for the contractor to innovate or improve efficiency, and increased vulnerability to supply chain disruptions if the sole provider faces operational issues. There's also a risk of 'vendor lock-in,' where the government becomes heavily dependent on one supplier, making it difficult and costly to switch providers in the future. This dependence can weaken the government's negotiating position over time. Furthermore, if the sole-source provider experiences financial difficulties or strategic shifts, it could jeopardize the availability of critical support for the EW system.

What is the operational significance of the AN/ALQ-221 EW suite on the U-2 platform?

The AN/ALQ-221 is an Electronic Warfare (EW) suite designed to detect, identify, and counter enemy radar and missile threats. On the U-2 reconnaissance aircraft, which operates in high-risk environments to gather intelligence, surveillance, and reconnaissance (ISR) data, the EW suite is crucial for survivability. It provides situational awareness of the electromagnetic spectrum, allowing the pilot (or mission systems) to avoid detection, jam threats, or employ countermeasures. The sustainment of this suite ensures the U-2 can continue its critical ISR missions safely and effectively, providing valuable intelligence to military commanders.

How has spending on U-2 sustainment evolved over the past five years?

Historical spending data for U-2 sustainment, specifically for the AN/ALQ-221 EW suite, is not directly available in the provided snippet. The current award covers the period from June 2021 to April 2025. To analyze spending evolution, one would need to examine contract awards for U-2 sustainment, including EW components, over previous fiscal years. This would involve searching databases like FPDS for contracts awarded to BAE Systems or other relevant entities for U-2 support. Factors influencing spending trends could include platform upgrades, changes in operational tempo, component obsolescence, and shifts in sustainment strategies (e.g., moving from organic support to contractor logistics support).

Industry Classification

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

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: Compagnie DE Developpement DE L'eau S.A.

Address: 65 SPIT BROOK RD, NASHUA, NH, 03060

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: $29,036,231

Exercised Options: $29,036,231

Current Obligation: $28,252,588

Subaward Activity

Number of Subawards: 7

Total Subaward Amount: $314,508

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA852820D0009

IDV Type: IDC

Timeline