DoD awards $23.77M contract to Hermeus Corp for hypersonic research, focusing on advanced aircraft development

Contract Overview

Contract Amount: $23,770,000 ($23.8M)

Contractor: Hermeus Corp

Awarding Agency: Department of Defense

Start Date: 2021-07-30

End Date: 2026-08-31

Contract Duration: 1,858 days

Daily Burn Rate: $12.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: R&D

Official Description: VC-25B HYPERSONIC SBIR PHASE 2

Place of Performance

Location: ATLANTA, DEKALB County, GEORGIA, 30340

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $23.8 million to HERMEUS CORP for work described as: VC-25B HYPERSONIC SBIR PHASE 2 Key points: 1. Contract awarded for advanced aircraft research, indicating a focus on next-generation defense capabilities. 2. The firm fixed-price contract structure aims to control costs for this high-risk, high-reward R&D effort. 3. The award to a single contractor suggests specialized capabilities are required for this advanced technology. 4. The duration of the contract (over 5 years) reflects the complex and long-term nature of hypersonic development. 5. This award aligns with broader defense investments in advanced aerospace technologies and strategic deterrence. 6. The contract's value, while significant for R&D, is a small fraction of overall defense procurement.

Value Assessment

Rating: good

The contract value of $23.77 million for a Phase 2 SBIR project appears reasonable given the highly specialized and advanced nature of hypersonic research. Benchmarking against similar R&D contracts in advanced aerospace is challenging due to the unique focus, but the firm fixed-price structure provides cost certainty for the government. The award is for a specific research objective, making direct value-for-money comparisons difficult without understanding the technical milestones achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which implies an initial broad solicitation followed by a specific exclusion. This suggests that while the opportunity was initially open, only a limited number of highly qualified sources were ultimately considered or able to meet the stringent requirements. The exact number of bidders or the rationale for exclusion is not detailed, but it points to a specialized technology area where few entities possess the necessary expertise.

Taxpayer Impact: This limited competition approach may result in higher prices compared to a fully open competition with multiple bidders. However, for highly specialized R&D, it ensures that the contract is awarded to entities with the most relevant and advanced capabilities, potentially leading to better technical outcomes.

Public Impact

The primary beneficiaries are the Department of Defense, specifically the Air Force, seeking advancements in hypersonic technology for potential future military applications. The contract will deliver research and development services focused on advancing the state-of-the-art in hypersonic aircraft design and capabilities. The geographic impact is primarily centered around the contractor's facilities in Georgia, though the technological advancements could have national security implications. This contract supports a highly skilled workforce in specialized engineering and research fields within the aerospace sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if technical challenges prove more significant than anticipated, despite the fixed-price structure.
Risk of technology not maturing to a deployable capability within the projected timeline or budget.
Dependence on a single contractor for critical advancements in a sensitive technology area.
Limited visibility into the specific technical progress and challenges without detailed reporting requirements.

Positive Signals

Award to a specialized firm (Hermeus Corp) with a stated focus on high-speed aircraft development.
Firm fixed-price contract provides cost control and predictability for the government.
SBIR Phase 2 award indicates prior successful research and validation in Phase 1.
Contract duration allows for thorough research and development of complex technologies.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on advanced aerospace and defense technologies. The market for hypersonic research is highly specialized, with significant government investment driven by national security imperatives. Comparable spending benchmarks are difficult to establish due to the niche nature, but it represents a strategic investment in future military capabilities, aligning with global trends in advanced weapons systems development.

Small Business Impact

This contract was not awarded as a small business set-aside. Hermeus Corp is a small business, but the contract type and nature of the work (SBIR Phase 2) are specific programs designed to foster small business innovation in R&D. There are no explicit subcontracting requirements mentioned, but the nature of R&D may lead to collaboration with other specialized firms.

Oversight & Accountability

Oversight will be provided by the Department of the Air Force, likely through program managers and contracting officers responsible for monitoring technical progress and adherence to contract terms. As a research and development contract, specific performance metrics and milestones will be key to assessing progress. Transparency is generally limited for advanced defense R&D contracts due to national security considerations, but standard reporting requirements will apply.

Related Government Programs

Small Business Innovation Research (SBIR) Program
Advanced Aerospace Research
Hypersonic Technology Development
Department of Defense Research and Development

Risk Flags

Technology Maturity Risk
Cost Overrun Potential
Long Development Timeline
Limited Competition Impact

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.8 million to HERMEUS CORP. VC-25B HYPERSONIC SBIR PHASE 2

Who is the contractor on this award?

The obligated recipient is HERMEUS 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 $23.8 million.

What is the period of performance?

Start: 2021-07-30. End: 2026-08-31.

What is Hermeus Corp's track record in developing advanced aerospace technologies, particularly related to high-speed flight?

Hermeus Corporation is known for its focus on developing high-speed aircraft, including concepts for hypersonic flight. The company has previously worked on projects aimed at significantly reducing travel times for both military and potential commercial applications. Their involvement in the SBIR program, progressing to Phase 2, suggests a demonstrated capability and successful prior research outcomes. While specific details of past projects may be proprietary, their stated mission and continued pursuit of advanced propulsion and airframe technologies indicate a specialized expertise relevant to this contract's objectives. The company's progress in this area is closely watched within the aerospace R&D community.

How does the $23.77 million contract value compare to other government investments in hypersonic research?

The $23.77 million contract value is a significant award for a single Small Business Innovation Research (SBIR) Phase 2 project, reflecting the high cost and complexity associated with developing advanced technologies like hypersonic aircraft. However, when compared to the broader landscape of government investments in hypersonic research and development across various agencies (including DoD, NASA, and others), this figure represents a focused investment in a specific technological pathway or component. Larger, more comprehensive programs involving system integration, testing, and prototyping can involve hundreds of millions or even billions of dollars. Therefore, while substantial for an SBIR award, it is a component within a much larger national effort.

What are the primary technical risks associated with this hypersonic research contract?

The primary technical risks associated with this hypersonic research contract are multifaceted. These include challenges in materials science to withstand extreme temperatures and pressures, advanced propulsion system development for efficient operation at hypersonic speeds, aerodynamic stability and control at Mach 5+, and thermal management systems. Furthermore, integrating these complex subsystems into a functional and reliable aircraft presents significant engineering hurdles. The transition from theoretical concepts and laboratory experiments to a viable prototype or system is inherently risky, with potential for unforeseen technical obstacles, performance shortfalls, and the need for iterative design changes, all of which can impact timelines and costs.

What is the expected impact of this contract on the advancement of U.S. hypersonic capabilities?

This contract is expected to contribute to the advancement of U.S. hypersonic capabilities by funding critical research and development efforts at a specialized small business. Specifically, it aims to mature technologies essential for the design and potential future operation of hypersonic aircraft. Success in this project could lead to breakthroughs in areas such as propulsion efficiency, airframe design, or materials, which are foundational elements for developing operational hypersonic systems. These advancements could eventually enhance U.S. strategic deterrence, intelligence, surveillance, and reconnaissance (ISR) capabilities, and potentially rapid global strike options, thereby bolstering national security.

What has been the historical spending trend for hypersonic R&D within the Department of Defense?

Historical spending trends for hypersonic Research and Development (R&D) within the Department of Defense (DoD) have shown a significant and increasing trajectory over the past decade. Driven by perceived threats and the strategic advantages offered by hypersonic capabilities, the DoD has consistently allocated substantial funding to various programs across its branches (Army, Navy, Air Force). This spending covers a wide range of activities, from basic research and component development to system integration and testing of prototypes. Budgets have grown from tens of millions to billions of dollars annually, reflecting a high-priority national security objective to develop and field advanced hypersonic weapons and defense systems.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

Product/Service Code: RESEARCH AND DEVELOPMENT › Transportation R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3960 DEKALB TECHNOLOGY PKWY, ATLANTA, GA, 30340

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $30,000,000

Exercised Options: $23,770,000

Current Obligation: $23,770,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline