DoD Awards $123M for 2 MQ-9 Reaper Systems to General Atomics, Sole-Source

Contract Overview

Contract Amount: $122,908,121 ($122.9M)

Contractor: General Atomics Aeronautical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2018-07-12

End Date: 2020-11-30

Contract Duration: 872 days

Daily Burn Rate: $140.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: FRANCE EXPORTABLE MQ-9 REAPER 3RD AND 4TH SYSTEMS

Place of Performance

Location: POWAY, SAN DIEGO County, CALIFORNIA, 92064

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $122.9 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC. for work described as: FRANCE EXPORTABLE MQ-9 REAPER 3RD AND 4TH SYSTEMS Key points: 1. High value contract for advanced drone systems. 2. Sole-source award limits competitive pricing. 3. Potential risk in reliance on a single supplier. 4. Defense sector spending on unmanned aerial vehicles.

Value Assessment

Rating: questionable

The contract value of $122.9M for two MQ-9 Reaper systems appears high, especially given the sole-source nature of the award. Without competitive bidding, it's difficult to assess if this represents fair market value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to General Atomics. This lack of competition likely resulted in higher pricing and limited opportunities for alternative solutions.

Taxpayer Impact: Taxpayers may have overpaid due to the absence of competitive pressure on pricing for these advanced drone systems.

Public Impact

Enhances France's military capabilities with advanced drone technology. Represents significant foreign military sales for the US defense industry. Potential for technology transfer and interoperability with US forces.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source procurement
Lack of competition
High contract value

Positive Signals

Foreign military sales
Advanced technology acquisition

Sector Analysis

This contract falls within the Aircraft Manufacturing sector, specifically for unmanned aerial vehicles (UAVs). Defense spending on UAVs has been increasing globally due to their strategic advantages.

Small Business Impact

The contract was awarded directly to General Atomics Aeronautical Systems, Inc., a large business. There is no indication of small business participation in this specific award.

Oversight & Accountability

The contract was managed by the Defense Contract Management Agency, suggesting standard oversight. However, the sole-source nature warrants scrutiny regarding justification and pricing.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source procurement lacks competition.
Potential for inflated pricing.
Limited market research evident.
No small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $122.9 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC.. FRANCE EXPORTABLE MQ-9 REAPER 3RD AND 4TH SYSTEMS

Who is the contractor on this award?

The obligated recipient is GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $122.9 million.

What is the period of performance?

Start: 2018-07-12. End: 2020-11-30.

What is the justification for the sole-source award of the MQ-9 Reaper systems to General Atomics?

The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent national security needs that only one contractor can meet. A thorough review would be required to validate these claims for the MQ-9 Reaper systems and ensure no viable alternatives were overlooked.

How does the per-unit cost of these MQ-9 Reapers compare to similar systems or previous acquisitions?

Without competitive bidding data, a direct comparison is challenging. However, historical data on MQ-9 acquisitions and pricing of comparable UAVs from other manufacturers could serve as a benchmark. The lack of competition here suggests the price might be higher than if it were competitively procured.

What are the long-term implications of this sole-source award on future defense procurement strategies for UAVs?

Sole-source awards can set precedents, potentially discouraging competition in future procurements if not carefully managed. It may signal a reliance on specific platforms and suppliers, impacting innovation and cost-effectiveness in the long run. Agencies should actively seek competitive opportunities where feasible.

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: General Atomics (UEI: 859181984)

Address: 14200 KIRKHAM WAY, POWAY, CA, 92064

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $122,908,121

Exercised Options: $122,908,121

Current Obligation: $122,908,121

Subaward Activity

Number of Subawards: 30

Total Subaward Amount: $6,251,733

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline