DoD Awards BAE Systems $27.6M for U-2 Electronic Warfare Suite Support Through 2025

Contract Overview

Contract Amount: $27,568,104 ($27.6M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2022-06-29

End Date: 2025-01-31

Contract Duration: 947 days

Daily Burn Rate: $29.1K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

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 $27.6 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. The contract focuses on sustainment for a critical electronic warfare system on the U-2 aircraft. 2. BAE Systems is the sole awardee, indicating a lack of competition for this specific sustainment effort. 3. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 4. The duration of the contract is substantial, spanning over two years, suggesting a long-term need.

Value Assessment

Rating: fair

The $27.6 million award for sustainment services appears to be within a reasonable range for specialized defense systems. However, without specific benchmarks for the AN/ALQ-221 EW suite, a precise comparison is difficult. The Cost Plus Fixed Fee structure warrants close monitoring for cost efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, suggesting a sole-source award. This limits price discovery and potentially increases costs compared to a competitive environment. The justification for sole-source is not provided but likely relates to specialized knowledge or existing system integration.

Taxpayer Impact: Taxpayer funds are being used for a sole-source contract, which may result in a higher cost than if competition were present. Effective oversight is crucial to ensure value for money.

Public Impact

Ensures continued operational readiness of U-2 aircraft's electronic warfare capabilities. Supports a critical intelligence, surveillance, and reconnaissance (ISR) platform for the Air Force. Maintains the effectiveness of a key defense system against evolving threats.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price negotiation.
Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Lack of detailed justification for sole-source award.

Positive Signals

Sustains a critical national security asset (U-2 aircraft).
Ensures continued operational capability of the AN/ALQ-221 EW suite.
Long-term support contract provides stability for a key defense system.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense electronics. Spending in this area is driven by the need to maintain and upgrade complex military systems to counter evolving threats. Benchmarks for similar sustainment contracts for advanced EW suites can vary widely based on system complexity and age.

Small Business Impact

This contract was awarded to BAE Systems, a large defense contractor. There is no indication that small businesses were involved as subcontractors in this specific award. Efforts to ensure small business participation in future, potentially competitive, sustainment contracts would be beneficial.

Oversight & Accountability

The Department of the Air Force is responsible for oversight. Given the sole-source nature and Cost Plus Fixed Fee structure, robust oversight is essential to manage costs, ensure performance, and verify the necessity of the services provided.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Potential for cost overruns
Lack of transparency in competition justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.6 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 $27.6 million.

What is the period of performance?

Start: 2022-06-29. End: 2025-01-31.

What is the specific justification for awarding this contract sole-source, and what steps are being taken to ensure fair pricing without competition?

The justification for a sole-source award typically relates to the unique capabilities, proprietary technology, or essential integration requirements of the contractor with the existing system. To ensure fair pricing, the government likely relies on historical pricing data, independent cost estimates, and rigorous negotiation of the fixed fee component. However, without a competitive process, the potential for higher costs remains a concern that requires diligent oversight.

What are the potential risks associated with the Cost Plus Fixed Fee contract type for this electronic warfare suite sustainment?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract is that the contractor may have less incentive to control costs, as the government bears the majority of the cost risk. While the fixed fee provides some incentive for efficiency, the 'cost plus' portion means that actual expenses are reimbursed. This necessitates strong government oversight to scrutinize costs, prevent waste, and ensure the contractor is performing efficiently to meet the program's objectives.

How does the sustainment of the AN/ALQ-221 EW suite on the U-2 contribute to overall Air Force ISR effectiveness and national security?

The AN/ALQ-221 Electronic Warfare suite is a critical component of the U-2's mission, enhancing its ability to operate safely and effectively in contested environments. By providing advanced threat detection and countermeasures, it directly supports the U-2's role in intelligence, surveillance, and reconnaissance (ISR). Sustaining this capability ensures the U-2 remains a viable and valuable platform for gathering vital intelligence, thereby bolstering national security.

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: COST PLUS FIXED FEE (U)

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: $28,341,707

Exercised Options: $28,341,707

Current Obligation: $27,568,104

Subaward Activity

Number of Subawards: 9

Total Subaward Amount: $737,398

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