DoD Awards BAE Systems $41.7M for U-2 Electronic Warfare Suite Support

Contract Overview

Contract Amount: $41,741,043 ($41.7M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2024-06-29

End Date: 2025-12-28

Contract Duration: 547 days

Daily Burn Rate: $76.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: SUPPORT AND SUSTAINMENT OF THE U-2 AN/ANQ-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 $41.7 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: SUPPORT AND SUSTAINMENT OF THE U-2 AN/ANQ-221 ELECTRONIC WARFARE SUITE Key points: 1. Significant contract value for specialized defense systems. 2. Sole-source award to BAE Systems raises competition concerns. 3. Potential for cost overruns given Cost Plus Fixed Fee structure. 4. Focus on critical U-2 aircraft sustainment.

Value Assessment

Rating: fair

The $41.7M award for sustainment of the U-2 EW suite is substantial. Without comparable contract data for this specific system, a direct pricing assessment is difficult. However, the Cost Plus Fixed Fee (CPFF) contract type suggests potential for costs to exceed initial estimates if not closely managed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to BAE Systems. This limits price discovery and potentially leads to higher costs compared to a competitive environment. The justification for sole-source is not provided but is likely due to specialized knowledge or existing integration.

Taxpayer Impact: Taxpayer funds are committed without competitive bidding, potentially resulting in a less optimal price for the government.

Public Impact

Ensures continued operational readiness of critical U-2 reconnaissance aircraft. Supports advanced electronic warfare capabilities essential for national security. Impacts the defense industrial base, specifically BAE Systems' EW division.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Cost Plus Fixed Fee contract type
Potential for cost growth

Positive Signals

Supports critical national security asset
Long-term sustainment contract

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting advanced aerospace and defense systems. Spending benchmarks for EW suite sustainment are highly specialized and vary greatly based on system complexity and aircraft platform.

Small Business Impact

This award went to a large prime contractor, BAE Systems. There is no indication of subcontracting opportunities for small businesses within the provided data, though prime contractors often utilize them for specific components or services.

Oversight & Accountability

Oversight will be crucial given the sole-source nature and CPFF contract type. The Department of the Air Force will need to diligently monitor costs and performance to ensure value for taxpayer money and adherence to contract terms.

Related Government Programs

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

Risk Flags

Sole-source award limits competitive pricing.
CPFF contract type carries risk of cost overruns.
Lack of transparency on justification for sole-sourcing.
Potential for contractor to not achieve efficiencies.
Dependence on a single contractor for critical EW sustainment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $41.7 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. SUPPORT AND SUSTAINMENT OF THE U-2 AN/ANQ-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 $41.7 million.

What is the period of performance?

Start: 2024-06-29. End: 2025-12-28.

What is the justification for the sole-source award, and has it been adequately documented to ensure fair pricing?

The justification for a sole-source award is typically based on factors like unique capabilities, proprietary technology, or lack of viable alternatives. Without access to the specific justification documentation, it's impossible to definitively assess if fair pricing was achieved. However, sole-source awards inherently reduce competitive pressure, making robust government negotiation and oversight even more critical to mitigate potential overpricing.

What are the projected cost ceilings and profit margins under this Cost Plus Fixed Fee contract?

The Cost Plus Fixed Fee (CPFF) contract structure means the government reimburses the contractor for allowable costs plus a predetermined fixed fee representing profit. While the fee is fixed, the total cost to the government can fluctuate. Detailed projections of cost ceilings and profit margins are typically found in the contract's detailed financial exhibits and require specific access to those documents for analysis.

How will the performance of the EW suite be measured to ensure effectiveness and justify continued investment?

Effectiveness will likely be measured through performance metrics defined in the contract's Statement of Work (SOW), such as system availability, reliability, response times, and successful mission support. Key Performance Parameters (KPPs) and technical performance measures (TPMs) will be established. Regular reviews and operational feedback from U-2 mission crews will also inform assessments of the suite's effectiveness.

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: Ball Corporation

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: $42,991,291

Exercised Options: $42,991,291

Current Obligation: $41,741,043

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $263,483

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