DoD Awards $76.8M for LITENING Targeting Pods to Northrop Grumman, Lacking Competition
Contract Overview
Contract Amount: $76,760,065 ($76.8M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2025-01-01
End Date: 2027-03-12
Contract Duration: 800 days
Daily Burn Rate: $96.0K/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 $76.8 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: LITENING CATP TARGETING PODS Key points: 1. Significant contract value for advanced targeting pods. 2. Sole-source award raises concerns about price discovery and potential overpayment. 3. Limited competition may stifle innovation and reduce overall value for taxpayers. 4. Engineering services sector is critical for defense modernization.
Value Assessment
Rating: questionable
The contract's price of $76.8 million for LITENING targeting pods lacks a competitive benchmark. Without competing bids, it's difficult to assess if this price represents fair market value compared to similar systems or previous procurements.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source or limited competition award. This approach bypasses the standard price discovery mechanisms inherent in competitive bidding, potentially leading to higher costs for the government.
Taxpayer Impact: The lack of competition means taxpayers may be paying a premium for these targeting pods, as the government did not leverage market forces to secure the best possible price.
Public Impact
Enhances air combat capabilities with advanced targeting technology. Supports ongoing military operations and readiness. Potential for increased costs impacts overall defense budget allocation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potential for overpricing
- Limited transparency in price determination
Positive Signals
- Critical defense technology procurement
- Long-term contract duration ensures supply continuity
Sector Analysis
The Department of Defense's procurement of advanced targeting pods falls within the engineering services sector, specifically related to aerospace and defense systems. Spending benchmarks for similar complex electronic systems can vary widely, but competitive processes are key to achieving cost efficiencies.
Small Business Impact
This contract was awarded to Northrop Grumman Systems Corporation, a large defense contractor. There is no indication that small businesses were involved in this specific sole-source award, limiting opportunities for SMB participation.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the price is justified and that future procurements consider competitive strategies to maximize value and accountability.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited vendor innovation
- Dependency on a single supplier
- Insufficient price transparency
Tags
engineering-services, department-of-defense, il, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $76.8 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 $76.8 million.
What is the period of performance?
Start: 2025-01-01. End: 2027-03-12.
What is the justification for awarding this contract sole-source, and what steps were taken to ensure a fair and reasonable price?
The justification for a sole-source award typically involves specific circumstances like unique capabilities or urgent needs. However, without a competitive process, rigorous independent cost analysis and negotiation are crucial to ensure the price is fair and reasonable. The government should have detailed documentation supporting the necessity of bypassing competition and the basis for the negotiated price.
What are the risks associated with relying on a single supplier for critical targeting pod technology?
Relying on a single supplier for critical technology like targeting pods creates significant risks. These include potential supply chain disruptions, lack of competitive pressure leading to higher costs over time, and reduced leverage in negotiating upgrades or maintenance. It also limits the government's ability to benefit from innovations offered by other potential suppliers.
How does this sole-source award impact the Air Force's ability to achieve cost-effective modernization of its targeting systems?
This sole-source award potentially hinders cost-effective modernization. By not engaging in competitive bidding, the Air Force misses opportunities to secure advanced technologies at potentially lower prices or to foster innovation among multiple vendors. This can lead to higher long-term sustainment costs and slower adoption of next-generation capabilities.
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: $77,777,576
Exercised Options: $77,777,576
Current Obligation: $76,760,065
Subaward Activity
Number of Subawards: 13
Total Subaward Amount: $14,266,694
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
Start Date: 2025-01-01
Current End Date: 2027-03-12
Potential End Date: 2027-03-12 00:00:00
Last Modified: 2026-01-15
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