DoD Awards Northrop Grumman $62.1M for Global Hawk/Triton Sustainment, Lacking Competition
Contract Overview
Contract Amount: $62,101,706 ($62.1M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2025-01-01
End Date: 2025-12-31
Contract Duration: 364 days
Daily Burn Rate: $170.6K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: REPAIR AND SUSTAINMENT OF THE RQ-4 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 $62.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: REPAIR AND SUSTAINMENT OF THE RQ-4 GLOBAL HAWK AND MQ-4C TRITON SYSTEMS Key points: 1. Significant contract value for critical drone systems sustainment. 2. Sole-source award raises concerns about price discovery and potential overpayment. 3. High-risk award due to lack of competitive pressure. 4. IT/Defense sector reliance on established contractors for specialized equipment.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can incentivize cost overruns. Without competitive benchmarking, assessing the fairness of the $62.1M price is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to reduce prices.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for these essential repair and sustainment services.
Public Impact
Ensures continued operational readiness of vital intelligence, surveillance, and reconnaissance (ISR) platforms. Supports advanced military capabilities for national security. Potential for increased costs impacts overall defense budget allocation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Ensures critical system availability
- Supports advanced ISR capabilities
Sector Analysis
This contract falls within the defense sector, specifically focusing on the repair and maintenance of advanced unmanned aerial vehicles. Spending benchmarks for such specialized sustainment can vary widely, but competitive bidding is typically expected to ensure value.
Small Business Impact
This contract does not appear to involve small business participation, as it is a sole-source award to a large defense contractor.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure costs are reasonable and that future opportunities for competition are explored.
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 inflated prices.
- Cost-plus contract type can incentivize higher spending.
- Potential for contractor lock-in due to specialized nature of services.
- Limited transparency in pricing due to sole-source award.
Tags
other-electronic-and-precision-equipment, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $62.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. REPAIR AND SUSTAINMENT OF THE RQ-4 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 $62.1 million.
What is the period of performance?
Start: 2025-01-01. End: 2025-12-31.
What is the historical cost performance for the sustainment of these systems under previous contracts, and how does it inform the current pricing?
Historical cost performance data is crucial for evaluating the reasonableness of the current $62.1M award. Without this data, it's difficult to determine if the fixed fee is appropriate or if cost overruns are likely. Analysis should focus on trends in repair costs, parts procurement, and labor hours to identify potential inefficiencies or areas where costs have escalated.
What steps are being taken to mitigate the risks associated with a sole-source award and ensure fair pricing?
Mitigation strategies for sole-source awards typically involve rigorous independent cost analysis, benchmarking against similar services (if available), and negotiating the most favorable terms possible. The agency should also document the justification for the sole-source award thoroughly and establish clear performance metrics to hold the contractor accountable for delivering value within the agreed-upon fixed fee.
How does the sustainment of the RQ-4 Global Hawk and MQ-4C Triton systems contribute to overall mission effectiveness and national security?
These systems provide critical intelligence, surveillance, and reconnaissance (ISR) capabilities, offering persistent, wide-area monitoring essential for national security. Their sustainment ensures the readiness of these advanced platforms, enabling timely and comprehensive data collection for strategic decision-making, threat assessment, and operational planning across various theaters.
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
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: $75,701,801
Exercised Options: $75,701,801
Current Obligation: $62,101,706
Subaward Activity
Number of Subawards: 16
Total Subaward Amount: $14,877,438
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: 2025-01-01
Current End Date: 2025-12-31
Potential End Date: 2025-12-31 00:00:00
Last Modified: 2025-09-29
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