DoD Awards Northrop Grumman $25.6M for Combat Communications Systems, Facing Limited Competition
Contract Overview
Contract Amount: $25,661,420 ($25.7M)
Contractor: Northrop Grumman Systems Corp
Awarding Agency: Department of Defense
Start Date: 2024-03-04
End Date: 2026-09-30
Contract Duration: 940 days
Daily Burn Rate: $27.3K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: B2 COLLABORATIVE COMBAT COMMUNICATIONS SPIRAL 2
Place of Performance
Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93550
Plain-Language Summary
Department of Defense obligated $25.7 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: B2 COLLABORATIVE COMBAT COMMUNICATIONS SPIRAL 2 Key points: 1. Significant contract value of $25.6 million awarded to a single large business. 2. Limited competition raises questions about price discovery and potential overspending. 3. Contract duration extends to September 2026, indicating a long-term need. 4. Focus on aircraft manufacturing suggests a critical component for Air Force operations.
Value Assessment
Rating: questionable
The contract is Cost Plus Fixed Fee, which can lead to higher costs if not managed carefully. Benchmarking against similar complex communication systems is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was 'NOT COMPETED', indicating a sole-source or limited competition award. This method may not yield the best price for taxpayers as it bypasses a broader market search.
Taxpayer Impact: The lack of robust competition could result in higher costs for taxpayers compared to a fully competed contract.
Public Impact
Enhances critical communication capabilities for the U.S. Air Force. Supports advanced aerospace and defense technology development. Potential impact on future military readiness and operational effectiveness.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Limited transparency on pricing
Positive Signals
- Addresses critical defense need
- Long-term contract provides stability
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on advanced communication systems for aircraft. Spending in this area is typically high due to the complexity and strategic importance of military technology.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corp, a large business. There is no indication of small business participation in this specific award, which is common for large, complex defense contracts.
Oversight & Accountability
The Department of the Air Force is responsible for oversight. The 'Cost Plus Fixed Fee' structure necessitates diligent monitoring to ensure costs remain reasonable and aligned with the fixed fee.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for cost overruns due to CPFF structure
- Limited competition may lead to suboptimal pricing
- Lack of transparency in cost justification
- Dependency on a single contractor for critical systems
Tags
aircraft-manufacturing, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.7 million to NORTHROP GRUMMAN SYSTEMS CORP. B2 COLLABORATIVE COMBAT COMMUNICATIONS SPIRAL 2
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORP.
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 $25.7 million.
What is the period of performance?
Start: 2024-03-04. End: 2026-09-30.
What specific factors justified the 'NOT COMPETED' status for this critical communication system, and were alternative solutions explored?
The justification for a 'NOT COMPETED' award typically stems from unique technical requirements, urgent needs, or the unavailability of other sources capable of meeting the specific demands of advanced combat communication systems. The Department of Defense would need to provide documentation detailing the market research conducted and the rationale for selecting Northrop Grumman exclusively to ensure the necessity of this approach.
How will the 'Cost Plus Fixed Fee' structure be managed to mitigate potential cost overruns and ensure value for taxpayer money?
Effective management of a Cost Plus Fixed Fee (CPFF) contract requires rigorous oversight of incurred costs, regular audits, and clear performance metrics. The Air Force must establish robust reporting mechanisms to track all expenses, ensure they are reasonable and allocable, and verify that the fixed fee is earned through the achievement of contract milestones and objectives.
What is the projected impact of these enhanced communication systems on the Air Force's overall operational effectiveness and future combat readiness?
Enhanced combat communication systems are vital for maintaining situational awareness, enabling rapid decision-making, and coordinating complex operations across multiple platforms and domains. Improved connectivity and data sharing can significantly boost the Air Force's ability to execute missions effectively, respond to threats, and maintain a strategic advantage in evolving geopolitical landscapes.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
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: 3520 E AVE M, PALMDALE, CA, 93550
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $47,659,602
Exercised Options: $39,366,391
Current Obligation: $25,661,420
Subaward Activity
Number of Subawards: 6
Total Subaward Amount: $414,238
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA861614D6060
IDV Type: IDC
Timeline
Start Date: 2024-03-04
Current End Date: 2026-09-30
Potential End Date: 2026-09-30 00:00:00
Last Modified: 2026-01-08
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