DoD awards Northrop Grumman $220M for Global Hawk/Triton sustainment, raising questions on competition
Contract Overview
Contract Amount: $219,583,758 ($219.6M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2021-01-01
End Date: 2025-12-19
Contract Duration: 1,813 days
Daily Burn Rate: $121.1K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: REPAIR AND SUSTAINMENT OF THE RQ-4B GLOBAL HAWK AND MQ-4C TRITON SYSTEMS.
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92127
Plain-Language Summary
Department of Defense obligated $219.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: REPAIR AND SUSTAINMENT OF THE RQ-4B GLOBAL HAWK AND MQ-4C TRITON SYSTEMS. Key points: 1. Significant contract value for critical unmanned aerial vehicle sustainment. 2. Sole-source award to Northrop Grumman, the prime contractor, limits competitive pricing. 3. Potential risk of inflated costs due to lack of competition. 4. Spending falls within the 'Other Electronic and Precision Equipment Repair and Maintenance' sector.
Value Assessment
Rating: questionable
The $220M award for repair and sustainment of the RQ-4B Global Hawk and MQ-4C Triton systems is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar complex aerospace sustainment services.
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 approach, while potentially efficient for a prime contractor, bypasses competitive price discovery, which could lead to higher costs for the government.
Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for these critical sustainment services.
Public Impact
Ensures continued operational readiness of vital intelligence, surveillance, and reconnaissance (ISR) platforms. Supports advanced drone technology crucial for national security missions. Potential for cost overruns impacts overall defense budget allocation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competitive pricing
- High contract value
Positive Signals
- Essential for critical ISR platforms
- Supports advanced technology
Sector Analysis
This contract falls under the 'Other Electronic and Precision Equipment Repair and Maintenance' sector, which is a broad category. Defense sustainment contracts for complex systems like the Global Hawk and Triton are typically high-value and often awarded to the original equipment manufacturer.
Small Business Impact
The contract was awarded directly to Northrop Grumman Systems Corporation, the prime contractor. There is no indication of subcontracting opportunities for small businesses within this specific award notice, though larger prime contractors often engage SMBs on broader programs.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential cost creep. Robust performance metrics and regular reviews are essential for accountability.
Related Government Programs
- Other Electronic and Precision Equipment Repair and Maintenance
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition may lead to higher costs.
- Potential for vendor lock-in.
- Limited transparency in pricing.
- Reliance on a single provider for critical systems.
Tags
other-electronic-and-precision-equipment, department-of-defense, ca, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $219.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. REPAIR AND SUSTAINMENT OF THE RQ-4B GLOBAL HAWK AND MQ-4C TRITON SYSTEMS.
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 $219.6 million.
What is the period of performance?
Start: 2021-01-01. End: 2025-12-19.
What is the justification for the sole-source award, and what steps are being taken to ensure cost-effectiveness?
The justification for a sole-source award typically relates to the unique capabilities or proprietary nature of the system, often requiring the original manufacturer for specialized knowledge. To ensure cost-effectiveness, the Department of Defense should implement stringent cost controls, performance-based metrics, and potentially conduct should-cost analyses to validate pricing against internal benchmarks and market intelligence.
What are the risks associated with relying solely on Northrop Grumman for sustainment of these critical assets?
The primary risk is the potential for inflated costs due to the absence of competitive pressure. This could also lead to vendor lock-in, reduced innovation, and a lack of flexibility if the government seeks alternative solutions or pricing structures in the future. Dependence on a single provider can also create vulnerabilities in the supply chain or technical support.
How does the sustainment cost of the Global Hawk and Triton compare to other similar unmanned aerial systems in the DoD inventory?
Without specific cost data broken down by system and compared against competitive benchmarks, it's challenging to provide a precise comparison. However, the high per-unit cost of advanced ISR platforms and their complex maintenance requirements generally place their sustainment costs significantly above smaller, less sophisticated drones. A detailed cost-benefit analysis and benchmarking against peer systems would be necessary for a definitive assessment.
Industry Classification
NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Other Electronic and Precision Equipment Repair and Maintenance
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: FA853919R0001
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 17066 GOLDENTOP RD, SAN DIEGO, CA, 92127
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: $278,980,528
Exercised Options: $278,980,528
Current Obligation: $219,583,758
Subaward Activity
Number of Subawards: 101
Total Subaward Amount: $242,249,244
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA853921D0001
IDV Type: IDC
Timeline
Start Date: 2021-01-01
Current End Date: 2025-12-19
Potential End Date: 2025-12-19 00:00:00
Last Modified: 2025-10-23
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