Northrop Grumman awarded $82.2M for AN/APG-69(V)9 RADAR FMS Purchase, a sole-source contract
Contract Overview
Contract Amount: $82,182,264 ($82.2M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2012-03-14
End Date: 2017-05-31
Contract Duration: 1,904 days
Daily Burn Rate: $43.2K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: AN/APG-69(V)9 RADAR FMS PURCHASE
Place of Performance
Location: LINTHICUM HEIGHTS, ANNE ARUNDEL County, MARYLAND, 21090
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $82.2 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: AN/APG-69(V)9 RADAR FMS PURCHASE Key points: 1. Contract awarded to a single vendor suggests potential lack of competitive pricing. 2. Long contract duration of 1904 days may indicate complex integration or sustainment needs. 3. The contract's value is significant within the specialized radar system manufacturing sector. 4. Performance context is limited due to the sole-source nature, making external benchmarking difficult. 5. Risk indicators are moderate, primarily related to the absence of competitive pressure on cost. 6. Sector positioning is within advanced aerospace and defense electronics manufacturing.
Value Assessment
Rating: fair
Benchmarking the value of this sole-source contract is challenging without comparable bids. The $82.2 million award for the AN/APG-69(V)9 RADAR FMS Purchase over approximately five years represents a substantial investment. Without competitive data, it's difficult to definitively assess if the pricing reflects optimal value for money. However, the nature of specialized defense systems often involves higher costs due to unique technological requirements and limited production runs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicated as 'NOT AVAILABLE FOR COMPETITION'. This means the government did not solicit bids from multiple vendors. Sole-source awards typically occur when only one vendor possesses the necessary technology, capability, or when urgent needs preclude a competitive process. The lack of competition limits the government's ability to leverage market forces to achieve the lowest possible price.
Taxpayer Impact: Taxpayers may not benefit from the cost savings that typically arise from a competitive bidding process. The absence of multiple offers means the price is negotiated directly with the sole provider.
Public Impact
The primary beneficiaries are the Department of Defense, specifically units requiring the AN/APG-69(V)9 RADAR system for operational readiness. Services delivered include the provision and potential integration of advanced radar systems. Geographic impact is likely concentrated within military installations and operational theaters where these systems are deployed. Workforce implications may include specialized technical roles within Northrop Grumman and potentially supporting industries involved in radar technology.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition could lead to higher costs than a competed contract.
- Sole-source nature limits transparency in pricing negotiations.
- Potential for vendor lock-in if alternative systems are not viable.
- Contract duration may mask potential cost overruns if not closely managed.
Positive Signals
- Award to an established defense contractor suggests a known entity with relevant expertise.
- FIRM FIXED PRICE contract type provides cost certainty for the government.
- Contract awarded by the Defense Contract Management Agency implies established oversight processes.
Sector Analysis
The contract falls within the aerospace and defense electronics sector, specifically focusing on radar systems. This is a highly specialized and technologically advanced market segment characterized by significant R&D investment and stringent performance requirements. The market size for such specialized defense components is substantial, driven by ongoing modernization efforts and global security needs. Comparable spending benchmarks would involve other advanced sensor and avionics procurements within the defense industry.
Small Business Impact
This contract does not appear to have a small business set-aside (ss: false, sb: false). As a sole-source award to a large prime contractor, there are no direct subcontracting implications for small businesses mandated by this specific award mechanism. However, the prime contractor may engage small businesses for specific components or services, but this is not explicitly detailed in the provided data.
Oversight & Accountability
Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), as indicated by the 'sa' field. DCMA is responsible for ensuring contractors meet performance, cost, and schedule requirements. The 'FIRM FIXED PRICE' contract type provides a degree of cost accountability. Transparency is limited due to the sole-source nature, but contract awards are generally reported in federal procurement databases.
Related Government Programs
- AN/APG-69 Radar Systems
- Foreign Military Sales (FMS) Program
- Defense Radar Manufacturing
- Aerospace Electronics Procurement
Risk Flags
- Sole-source award
- Lack of competitive pricing
- Potential for cost overruns
- Limited transparency
Tags
defense, department-of-defense, northrop-grumman, radar-systems, sole-source, firm-fixed-price, fms, aerospace, electronics, maryland, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $82.2 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. AN/APG-69(V)9 RADAR FMS PURCHASE
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 (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $82.2 million.
What is the period of performance?
Start: 2012-03-14. End: 2017-05-31.
What is the track record of Northrop Grumman Systems Corporation with similar sole-source radar system contracts?
Northrop Grumman Systems Corporation has a long history of developing and producing complex defense systems, including radar technology, for various government agencies. While specific data on their sole-source contracts for similar radar systems isn't provided here, their extensive experience in the aerospace and defense sector suggests a capability to deliver on such requirements. Analyzing past sole-source awards to Northrop Grumman for comparable systems could reveal patterns in pricing, contract duration, and performance outcomes. However, without direct comparative data for this specific AN/APG-69(V)9 RADAR FMS Purchase, assessing their track record in this precise context remains limited to general industry knowledge of their large-scale defense contracting.
How does the value of this contract compare to other AN/APG-69 radar procurements or similar systems?
Direct comparison of this $82.2 million contract for the AN/APG-69(V)9 RADAR FMS Purchase is difficult due to its sole-source nature and the specific variant. Typically, competitive procurements allow for direct price benchmarking. If this were a competitive award, we could compare the per-unit cost or total value against other bids. For sole-source contracts, comparisons are often made against historical pricing for the same or similar systems, or against industry benchmarks for comparable technology. Given the specialized nature of military radar systems and potential Foreign Military Sales (FMS) implications, costs can vary significantly based on configuration, quantity, and specific customer requirements. Without access to pricing data for other AN/APG-69 variants or comparable systems procured competitively, a precise value comparison is not feasible from the provided data.
What are the primary risks associated with a sole-source award for advanced radar systems?
The primary risks associated with a sole-source award for advanced radar systems like the AN/APG-69(V)9 include potential overpricing due to the lack of competitive pressure, reduced incentive for the contractor to innovate or improve efficiency, and the risk of vendor lock-in. Without competing offers, the government may pay a premium compared to what could be achieved in an open market. Furthermore, reliance on a single supplier can create vulnerabilities if that supplier faces production issues, financial instability, or decides to discontinue the product line. The absence of competition also limits the government's leverage in negotiating terms and conditions, potentially leading to less favorable contract outcomes.
How effective is the Defense Contract Management Agency (DCMA) in overseeing sole-source contracts of this magnitude?
The Defense Contract Management Agency (DCMA) is a critical component of the Department of Defense's acquisition process, responsible for ensuring contract compliance and performance. DCMA's effectiveness in overseeing sole-source contracts, including those of significant value like the $82.2 million AN/APG-69(V)9 RADAR FMS Purchase, relies on robust oversight mechanisms, skilled personnel, and access to necessary data from the contractor. While DCMA generally employs rigorous processes for contract administration, the inherent limitations of sole-source awards (e.g., less price transparency) can present unique challenges. Their oversight focuses on verifying costs, ensuring quality, monitoring progress, and enforcing contract terms to achieve the best possible value under the given circumstances.
What are the historical spending patterns for AN/APG-69 radar systems or similar defense electronics by the Department of Defense?
Historical spending patterns for AN/APG-69 radar systems or similar defense electronics by the Department of Defense are typically characterized by significant, long-term investments in advanced technologies. Procurements often involve multiple contract actions over several years, reflecting research, development, production, and sustainment phases. Spending can fluctuate based on defense priorities, technological advancements, and geopolitical factors. Analyzing past contract awards for radar systems within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' (NAICS 334511) sector provides insight into typical contract values, durations, and the prevalence of sole-source versus competitive awards. This specific contract represents one data point within a broader pattern of substantial defense electronics spending.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 1580A W NURSERY RD, LINTHICUM HEIGHTS, MD, 21090
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: $82,182,264
Exercised Options: $82,182,264
Current Obligation: $82,182,264
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2012-03-14
Current End Date: 2017-05-31
Potential End Date: 2017-05-31 00:00:00
Last Modified: 2019-04-30
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