DoD Awards $241M for Joint Strike Missile Lot 2 & Option Lot 3 to Kongsberg Defence & Aerospace
Contract Overview
Contract Amount: $240,904,098 ($240.9M)
Contractor: Kongsberg Defence & Aerospace AS
Awarding Agency: Department of Defense
Start Date: 2025-12-12
End Date: 2025-12-12
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: JOINT STRIKE MISSILE LOT 2 AND OPTION LOT 3
Plain-Language Summary
Department of Defense obligated $240.9 million to KONGSBERG DEFENCE & AEROSPACE AS for work described as: JOINT STRIKE MISSILE LOT 2 AND OPTION LOT 3 Key points: 1. Significant award for advanced missile systems, indicating continued investment in defense capabilities. 2. Sole-source award to Kongsberg raises questions about competition and potential price efficiencies. 3. High value contract highlights the strategic importance and cost of modern guided missile technology. 4. Focus on propulsion units suggests a critical component for missile performance and reliability.
Value Assessment
Rating: questionable
The contract value of $241 million for missile propulsion units is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market alternatives or previous contract pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Kongsberg Defence & Aerospace. This limits price discovery and may result in higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition for this significant defense contract means taxpayers may not be receiving the best possible price for these critical missile components.
Public Impact
Enhances U.S. air combat capabilities with advanced missile technology. Supports a key defense contractor, potentially impacting jobs and the defense industrial base. Procurement of propulsion units is vital for the operational readiness of air and naval forces. Potential for increased costs due to sole-source nature impacts overall defense budget allocation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement
- Lack of transparency in pricing
- Potential for cost overruns
Positive Signals
- Acquisition of advanced defense technology
- Support for critical military readiness
Sector Analysis
This contract falls within the Guided Missile and Space Vehicle Propulsion Unit Manufacturing sector. Spending in this area is driven by national security needs and technological advancements in aerospace and defense.
Small Business Impact
The data does not indicate any specific involvement or benefit for small businesses in this sole-source contract award.
Oversight & Accountability
Oversight is crucial for sole-source contracts to ensure fair pricing and prevent waste. The Department of Defense's contracting process should include robust justification for non-competitive awards.
Related Government Programs
- Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits competitive pricing.
- Potential for cost overruns due to lack of competition.
- Limited transparency on pricing justification.
- Dependency on a single supplier for critical components.
Tags
guided-missile-and-space-vehicle-propuls, department-of-defense, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $240.9 million to KONGSBERG DEFENCE & AEROSPACE AS. JOINT STRIKE MISSILE LOT 2 AND OPTION LOT 3
Who is the contractor on this award?
The obligated recipient is KONGSBERG DEFENCE & AEROSPACE AS.
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 $240.9 million.
What is the period of performance?
Start: 2025-12-12. End: 2025-12-12.
What is the justification for awarding this contract on a sole-source basis, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. To ensure fair pricing, the DoD often conducts cost analyses, reviews historical pricing, and may negotiate profit margins. However, without competition, the benchmark for 'fairness' is less robust.
How does the cost of this contract compare to similar missile propulsion systems acquired competitively?
Direct comparison is challenging without access to specific cost data for comparable competitive contracts. However, sole-source awards generally carry a higher risk of inflated prices due to the absence of market pressure. A thorough cost realism analysis by the agency is essential to mitigate this risk.
What is the long-term strategic value and potential obsolescence risk associated with this specific missile propulsion technology?
The long-term value depends on the Joint Strike Missile's continued relevance in future combat scenarios and its integration with evolving platforms. Risk of obsolescence is managed through ongoing research and development, and potential upgrades. The DoD likely assesses this technology's lifespan and upgradeability before committing significant funds.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing
Product/Service Code: GUIDED MISSLES
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
Address: KIRKEGARDSVEIEN 45, KONGSBERG
Business Categories: Category Business, Foreign Owned, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $240,904,098
Exercised Options: $240,904,098
Current Obligation: $240,904,098
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2025-12-12
Current End Date: 2025-12-12
Potential End Date: 2028-12-12 00:00:00
Last Modified: 2025-12-22
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