DoD Awards Northrop Grumman $314.6M for Global Hawk Payloads and Spares Production
Contract Overview
Contract Amount: $314,632,066 ($314.6M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2010-05-20
End Date: 2015-11-30
Contract Duration: 2,020 days
Daily Burn Rate: $155.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: GLOBAL HAWK LRIP LOT 9 PAYLOADS AND SPARES PRODUCTION UCA MODIFICATION
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92127
Plain-Language Summary
Department of Defense obligated $314.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: GLOBAL HAWK LRIP LOT 9 PAYLOADS AND SPARES PRODUCTION UCA MODIFICATION Key points: 1. Significant contract value for specialized aircraft components. 2. Northrop Grumman is the sole provider for this specific modification. 3. Potential risk associated with sole-source procurement and limited competition. 4. Spending falls within the broad 'Aircraft Manufacturing' sector.
Value Assessment
Rating: fair
The contract value of $314.6M for LRIP Lot 9 payloads and spares is substantial. Without specific unit cost data or benchmarks for similar payload modifications, a precise value assessment is difficult. However, the scale suggests a significant investment in advanced aircraft capabilities.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Northrop Grumman Systems Corporation. This limits price discovery and potentially leads to higher costs compared to a competitive environment. The modification likely addresses unique requirements for the Global Hawk program.
Taxpayer Impact: Taxpayer funds are allocated for critical defense hardware. The lack of competition raises concerns about cost-effectiveness, as the government may not have secured the best possible price.
Public Impact
Enhances the operational capabilities of the Global Hawk unmanned aerial system. Supports ongoing production and sustainment of a key defense asset. Impacts the defense industrial base, specifically in advanced aerospace manufacturing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price negotiation.
- Lack of small business participation noted.
- Contract duration extends over several years, increasing cost uncertainty.
Positive Signals
- Supports critical defense platform (Global Hawk).
- Firm Fixed Price contract provides cost certainty once negotiated.
- Awarded to an established defense contractor with proven capabilities.
Sector Analysis
This contract falls under the Aircraft Manufacturing sector, a critical component of the defense industrial base. Spending in this sector is often characterized by high R&D costs, long production cycles, and significant government investment due to national security requirements.
Small Business Impact
The data indicates that small businesses were not involved in this specific contract award (sb: false). This is common for large, complex defense manufacturing contracts that require specialized capabilities and infrastructure typically held by prime contractors.
Oversight & Accountability
As a sole-source award for a significant defense program, this contract warrants close oversight from the Department of the Air Force to ensure fair pricing and adherence to contract terms. Robust auditing and performance monitoring are crucial for accountability.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source procurement limits competitive pricing.
- Lack of small business participation.
- Potential for cost overruns in long-term production.
- Dependency on a single supplier for critical components.
Tags
aircraft-manufacturing, department-of-defense, ca, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $314.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. GLOBAL HAWK LRIP LOT 9 PAYLOADS AND SPARES PRODUCTION UCA MODIFICATION
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 $314.6 million.
What is the period of performance?
Start: 2010-05-20. End: 2015-11-30.
What is the specific justification for the sole-source award, and were alternative solutions considered?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or essential integration requirements that only one contractor can fulfill. For the Global Hawk program, Northrop Grumman's established role and specific expertise with the platform likely led to this determination. Alternative solutions might have been explored internally, but the specific nature of payload and spare production for an existing system often favors the original equipment manufacturer.
How does the unit cost of these payloads and spares compare to previous lots or similar systems?
Benchmarking the unit cost is challenging without access to detailed cost breakdowns or comparative data from similar contracts. Given the sole-source nature and the advanced technology involved in Global Hawk payloads, costs could be higher than in a competitive scenario. A thorough cost analysis by the DoD would be necessary to validate the pricing against established benchmarks or historical data for similar systems.
What is the long-term strategic value and potential obsolescence risk associated with these Global Hawk payloads?
The long-term strategic value depends on the evolving role of the Global Hawk in ISR (Intelligence, Surveillance, and Reconnaissance) missions and the Air Force's future platform strategy. Potential obsolescence risk exists as technology advances rapidly. Continuous assessment of the platform's relevance and the integration of newer technologies will be crucial to mitigate this risk and ensure the investment remains strategically sound.
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
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 17066 GOLDENTOP RD, SAN DIEGO, CA, 92127
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $321,231,324
Exercised Options: $320,901,140
Current Obligation: $314,632,066
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2010-05-20
Current End Date: 2015-11-30
Potential End Date: 2015-11-30 00:00:00
Last Modified: 2022-08-31
More Contracts from Northrop Grumman Systems Corporation
- 200506!000026!5700!fa8214!oo-Alc/Pkme/Lmke !F4261098C0001 !A!N! !Y! !p01502!20041213!20050701!001563738!004179453!016435559!n!northrop Grumman Space & Missi!888 S 2000 E !clearfield !ut!84015!13850!011!49!clearfield !davis !utah !-000001960000!n!n!000000000000!l014!tech REP Svcs/Guided Missiles !A2 !missile and Space Systems !302 !minuteman III GRP !541330!E! !3! ! !C! ! !20200930!B! ! !A! !a!n!l!2!002!b! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! — $10.0B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-7) — $8.5B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-2) — $5.4B (Department of Defense)
- First DDT and E, Ares I-X, and Flight Tests. First Stage Will BE a Five Segment, Solid Rocket Booster Derived From the Space Shuttle Program (SSP) Solid Rocket Booster (srb)/Reusable Solid Rocket Motor (rsrm). the Contractor Shall Furnish the Necessary Management, Engineering, Labor, Facilities, Tools, Equipment, and Materials Required for First Stage Development, Qualification, Certification and Acceptance Program. Activities Include: Redesign and Testing of the Motor to Incorporate the Fifth Segment and Production of Five Full Scale Ground Static Test Motors: TWO Development Motors (dms)-And Three Qualification Motors (QMS); Structural Test Article (STA), Ground Vibration Test Motors (gvtms) and Other Development Testing; Redesign of the Avionics, Deceleration, Separation, and Flight Termination System (FTS) Subsystems; Ares I-X: Simulated Ares I Outer Mold Line/Mass Properties Using Modified Srb/Rsrm; and Three Flight Test Vehicles. TAS::80 0124::TAS — $4.4B (National Aeronautics and Space Administration)
- Federal Contract — $4.4B (Department of Defense)
View all Northrop Grumman Systems Corporation federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)