Raytheon Company awarded $36.3M for Advanced Medium Range Air-to-Air Missiles (AMRAAM) by the Department of the Air Force

Contract Overview

Contract Amount: $36,301,122 ($36.3M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2024-04-22

End Date: 2026-06-30

Contract Duration: 799 days

Daily Burn Rate: $45.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ADVANCED MEDIUM RANGE AIR-TO-AIR MISSILE (AMRAAM)

Place of Performance

Location: TUCSON, PIMA County, ARIZONA, 85756

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $36.3 million to RAYTHEON COMPANY for work described as: ADVANCED MEDIUM RANGE AIR-TO-AIR MISSILE (AMRAAM) Key points: 1. Contract awarded as a delivery order under an existing contract. 2. Focus on guided missile and space vehicle manufacturing. 3. Contract duration spans over two years. 4. Firm Fixed Price contract type indicates price certainty. 5. No small business set-aside noted for this specific award. 6. Awarded to a single, established defense contractor.

Value Assessment

Rating: fair

The contract value of $36.3 million for AMRAAMs appears to be within a reasonable range for advanced missile systems, though a direct comparison to similar recent procurements is needed for a definitive value assessment. The firm fixed price structure provides cost predictability. However, without detailed cost breakdowns or benchmark data for comparable missile systems, it is difficult to ascertain if this represents optimal value for money. The absence of competition further limits the ability to benchmark pricing effectively.

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 often used when a specific contractor possesses unique capabilities or when the item is a sole-source product. The lack of competition means that price discovery through market forces was not utilized, potentially leading to higher costs than if multiple bids were solicited.

Taxpayer Impact: For taxpayers, sole-source awards can mean less assurance of obtaining the best possible price, as the government does not benefit from competitive bidding to drive down costs.

Public Impact

Enhances the air combat capabilities of the U.S. Air Force. Supports the operational readiness of fighter aircraft. Primarily benefits the Department of Defense and its personnel. Geographic impact is concentrated within the defense sector, with potential downstream effects on aerospace manufacturing hubs. Sustains jobs within the defense manufacturing industry, particularly at Raytheon Company.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher unit costs.
Sole-source award limits transparency in pricing.
Reliance on a single supplier for critical defense assets.

Positive Signals

Awarded to a known and experienced defense contractor.
Firm Fixed Price contract provides cost certainty.
Supports a critical defense capability (AMRAAM).

Sector Analysis

The Advanced Medium Range Air-to-Air Missile (AMRAAM) falls within the Defense sector, specifically the Guided Missile and Space Vehicle Manufacturing sub-sector. This is a highly specialized and technologically advanced area of the aerospace and defense industry. Spending in this sector is driven by national security requirements and technological advancements in aerial warfare. Comparable spending benchmarks would typically involve other major missile system procurements by the Department of Defense.

Small Business Impact

This contract was not awarded as a small business set-aside, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary awardee, Raytheon Company, will be performing the majority of the work. The impact on the small business ecosystem is likely minimal for this specific award, as it does not appear to leverage small business capabilities directly.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial management systems. Accountability measures are inherent in the firm fixed price contract type, which obligates the contractor to deliver the specified goods at the agreed-upon price. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Air-to-Air Missiles
Guided Missile Manufacturing
Department of Defense Procurement
Aerospace and Defense Contracts
Raytheon Company Contracts

Risk Flags

Sole-source award
Lack of competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $36.3 million to RAYTHEON COMPANY. ADVANCED MEDIUM RANGE AIR-TO-AIR MISSILE (AMRAAM)

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

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 $36.3 million.

What is the period of performance?

Start: 2024-04-22. End: 2026-06-30.

What is the historical spending trend for AMRAAMs by the Department of the Air Force?

Historical spending data for AMRAAMs by the Department of the Air Force reveals a consistent procurement pattern over several years, reflecting the ongoing need for these air-to-air missiles. While specific annual figures fluctuate based on readiness requirements, modernization programs, and budget allocations, the overall trend indicates sustained investment in this critical capability. For instance, in previous fiscal years, the Air Force has awarded multiple contracts for AMRAAMs, often through competitive processes or as follow-on orders to existing agreements. The total obligated amounts have varied, but the aggregate spending underscores the strategic importance placed on maintaining a robust inventory of these advanced munitions. Analyzing these historical patterns helps contextualize the current $36.3 million award, suggesting it aligns with established procurement strategies rather than representing a significant deviation.

How does the unit cost of this AMRAAM award compare to previous procurements or other branches of the military?

Determining the precise unit cost for this specific AMRAAM award is challenging without a breakdown of the total value by the number of units procured. However, based on publicly available data for similar AMRAAM procurements, unit costs have historically ranged significantly depending on the specific variant, quantity ordered, and contract type. For example, past contracts have shown unit prices that could range from approximately $400,000 to over $1 million per missile. If this $36.3 million award covers a substantial quantity, the unit cost might fall within this established range. Comparisons across different branches of the military or even within the Air Force can be complex due to varying procurement strategies, economies of scale, and specific technical requirements for different missile lots. The sole-source nature of this award further complicates direct price benchmarking against competitive bids.

What are the specific performance requirements and technical specifications for the AMRAAMs being procured?

The Advanced Medium Range Air-to-Air Missile (AMRAAM) is designed as a fire-and-forget missile capable of engaging targets at ranges beyond visual sight. Its primary function is to provide fighter aircraft with a significant advantage in air-to-air combat scenarios. Key performance requirements typically include high accuracy, resistance to countermeasures, all-weather capability, and the ability to track and engage multiple targets. Technical specifications often involve advanced radar seekers, inertial navigation systems, and propulsion systems optimized for speed and maneuverability. While the exact specifications for this particular $36.3 million award are not detailed in the provided data, AMRAAMs are known for their sophisticated guidance systems and lethality against a wide array of aerial threats. The Department of the Air Force relies on these missiles to maintain air superiority.

What is Raytheon Company's track record in delivering AMRAAMs and similar defense systems?

Raytheon Company, now part of RTX, has a long and established track record as the prime contractor for the Advanced Medium Range Air-to-Air Missile (AMRAAM) program. They have been responsible for the development, production, and sustainment of AMRAAMs for decades, supplying them to the U.S. Air Force, Navy, and numerous allied nations. Their performance history with this specific weapon system is generally considered strong, marked by consistent delivery and technological upgrades over multiple missile variants. Raytheon has demonstrated capabilities in managing complex production schedules, adhering to stringent quality control standards, and integrating advanced technologies into the missile system. Their extensive experience provides a high degree of confidence in their ability to fulfill current and future orders for AMRAAMs, although the sole-source nature of some awards means direct cost comparisons are limited.

Are there any identified risks associated with this sole-source contract for AMRAAMs?

The primary risk associated with this sole-source contract for AMRAAMs is the potential for inflated pricing due to the lack of competitive bidding. Without competing offers, there is less market pressure on Raytheon Company to offer the lowest possible price. Another risk is the potential for complacency or reduced innovation, as the contractor may face less urgency to improve efficiency or develop cost-saving measures when competition is absent. Furthermore, a sole-source award can create a dependency on a single supplier, which could pose supply chain risks if the contractor experiences production issues or if geopolitical factors impact their operations. Ensuring robust oversight and negotiation strategies becomes critical to mitigate these inherent risks.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing

Product/Service Code: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 1151 E HERMANS RD, TUCSON, AZ, 85756

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: $36,301,122

Exercised Options: $36,301,122

Current Obligation: $36,301,122

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA867523D0001

IDV Type: IDC

Timeline