DoD awards $54.7M for LITENING targeting pods to Northrop Grumman, a sole-source contract

Contract Overview

Contract Amount: $54,726,735 ($54.7M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2024-01-01

End Date: 2026-03-31

Contract Duration: 820 days

Daily Burn Rate: $66.7K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: LITENING CATP TARGETING PODS

Place of Performance

Location: ROLLING MEADOWS, COOK County, ILLINOIS, 60008

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $54.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: LITENING CATP TARGETING PODS Key points: 1. Contract awarded to a single vendor suggests potential lack of competitive pricing pressure. 2. Long-term contract duration (over 2 years) indicates sustained need for targeting pod technology. 3. Firm Fixed Price contract type shifts cost risk to the contractor. 4. Geographic concentration in Illinois for the contractor. 5. This award represents a significant investment in advanced aerial surveillance and targeting capabilities for the Air Force.

Value Assessment

Rating: fair

Benchmarking the value of this sole-source contract is challenging without competitive bids. The total award of $54.7 million over approximately two years suggests a substantial per-unit cost for the LITENING CATP targeting pods. Without comparable contract data or market analysis for similar advanced targeting systems, it's difficult to definitively assess if this represents excellent value for money. The firm fixed-price nature provides cost certainty but doesn't inherently guarantee optimal pricing.

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 approach is typically used when only one vendor possesses the necessary technology, capability, or when urgency dictates a rapid award. The lack of competition means that the government did not benefit from the price discovery and innovation that typically arises from a competitive bidding process.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as there is no competitive pressure to drive down costs. It also limits opportunities for other qualified businesses to secure government contracts.

Public Impact

The primary beneficiaries are the U.S. Air Force and its operational units, which will receive advanced targeting pods essential for modern air combat. The services delivered include the provision of sophisticated LITENING CATP targeting pods, enhancing aircraft's ability to identify, track, and engage targets. The geographic impact is primarily within the operational theaters where the Air Force deploys these aircraft, and domestically at the contractor's facility in Illinois. Workforce implications include continued employment for engineers, technicians, and manufacturing personnel at Northrop Grumman.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Lack of transparency in the procurement process due to non-competitive nature.
Potential for vendor lock-in if alternative targeting systems are not considered.
Dependence on a single supplier for critical defense technology.

Positive Signals

Firm Fixed Price contract type provides cost certainty to the government.
Award to an established defense contractor with a track record in targeting systems.
Sustained investment in advanced military technology critical for national security.

Sector Analysis

The defense sector, particularly aerospace and defense electronics, is characterized by high R&D costs, long product development cycles, and significant government procurement. Northrop Grumman is a major player in this market, specializing in advanced systems like targeting pods. The market for such specialized defense equipment is often concentrated among a few large prime contractors. This contract fits within the broader category of defense procurement for avionics and sensor systems, where spending can reach billions annually across various platforms.

Small Business Impact

This contract does not appear to involve a small business set-aside, as the award is made to Northrop Grumman Systems Corporation, a large defense contractor. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific set-aside goals or mandated subcontracting targets, the direct impact on the small business ecosystem for this particular award is likely minimal, 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 Defense's contracting and program management offices within the Air Force. Accountability measures are inherent in the firm fixed-price contract structure, which obligates the contractor to deliver specified goods. Transparency is limited due to the sole-source nature of the award. The Inspector General of the Department of Defense would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Advanced Targeting Pods
Air Force Avionics Procurement
Defense Sensor Systems
Northrop Grumman Defense Contracts
LITENING Pod Program

Risk Flags

Sole-source procurement
Lack of competitive bidding
Potential for cost overruns without competition
Long-term contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $54.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. LITENING CATP TARGETING PODS

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 $54.7 million.

What is the period of performance?

Start: 2024-01-01. End: 2026-03-31.

What is the historical spending trend for LITENING CATP Targeting Pods by the Department of Defense?

Analyzing historical spending on LITENING CATP Targeting Pods requires accessing detailed contract databases over multiple fiscal years. Typically, such advanced systems see consistent investment, especially if they are integral to current military operations and aircraft platforms. Without specific historical data for this exact contract vehicle or related procurements, it's difficult to provide precise figures. However, the nature of defense procurement suggests that if the LITENING pod remains a critical asset, spending would likely be in the tens of millions annually, potentially fluctuating based on modernization efforts, fleet size, and operational tempo. The current award of $54.7 million over two years aligns with sustained procurement of such specialized equipment.

How does the unit cost of these LITENING pods compare to similar targeting systems from other manufacturers?

Directly comparing the unit cost of these LITENING pods is challenging without knowing the exact configuration and specific features procured under this contract, as well as the negotiated price per unit. Furthermore, sole-source awards inherently lack the competitive benchmarking that would provide a clear market price. To perform a robust comparison, one would need access to pricing data for comparable systems like the Advanced Targeting Forward Looking Infrared (ATFLIR) or Sniper Advanced Targeting Pod (ATP) from other manufacturers, considering factors such as sensor resolution, range, processing capabilities, and integration costs. Such data is often proprietary or requires specific government procurement analysis.

What are the key performance metrics or capabilities that justify the investment in LITENING CATP Targeting Pods?

The LITENING CATP Targeting Pod is a crucial electro-optical/infrared (EO/IR) targeting system designed to provide aircrews with high-resolution imagery for target detection, identification, tracking, and laser designation. Key performance metrics likely include sensor resolution (day and night), target detection range, accuracy of laser designation, data link capabilities for real-time imagery transmission, and reliability under various environmental conditions. The investment is justified by its ability to enhance precision strike capabilities, reduce collateral damage through accurate targeting, improve situational awareness for pilots, and support intelligence, surveillance, and reconnaissance (ISR) missions. Its integration onto multiple aircraft platforms also offers operational flexibility.

What is Northrop Grumman's track record with the LITENING pod program and similar defense contracts?

Northrop Grumman has a long and established track record with the LITENING targeting pod program, having developed and produced various iterations of the system for the U.S. Air Force, Navy, Marine Corps, and numerous international allies for decades. The company is a major defense contractor with extensive experience in developing and manufacturing complex aerospace systems, including sensors, avionics, and electronic warfare systems. Their history with LITENING suggests a deep understanding of the technology and a proven ability to deliver reliable performance. This experience likely contributes to their continued selection for subsequent contracts, although it also underscores the sole-source nature of this specific award.

Are there any known risks associated with the performance or sustainment of the LITENING CATP Targeting Pods?

While the LITENING pod is a mature and widely deployed system, potential risks can exist. These might include obsolescence of certain components over time, requiring upgrades or replacements to maintain technological relevance. Sustainment risks could involve the availability of spare parts, the cost of maintenance and repair, and the contractor's ability to provide timely support. Operational risks could relate to the pod's performance in extreme environmental conditions or its susceptibility to countermeasures. However, given its long service history and continuous upgrades, major systemic performance risks are likely mitigated through ongoing product improvement and support contracts.

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: Northrop Grumman Corporation

Address: 600 HICKS RD, ROLLING MEADOWS, IL, 60008

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: $54,726,735

Exercised Options: $54,726,735

Current Obligation: $54,726,735

Subaward Activity

Number of Subawards: 54

Total Subaward Amount: $29,642,256

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA854019D0001

IDV Type: IDC

Timeline