Raytheon Company awarded $30M contract for Space Fence Phase A SDR by Department of Defense

Contract Overview

Contract Amount: $30,000,000 ($30.0M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2009-06-11

End Date: 2010-12-10

Contract Duration: 547 days

Daily Burn Rate: $54.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SPACE FENCE PHASE A SDR

Place of Performance

Location: SUDBURY, MIDDLESEX County, MASSACHUSETTS, 01776

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $30.0 million to RAYTHEON COMPANY for work described as: SPACE FENCE PHASE A SDR Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract value of $30 million is a significant investment in space surveillance capabilities. 3. Fixed-price contract type aims to control costs and provide predictability. 4. The duration of 547 days indicates a substantial project timeline. 5. The North American Industry Classification System (NAICS) code 334511 points to the manufacturing of search, detection, and navigation systems. 6. Awarded by the Department of the Air Force, highlighting its role in national security and space domain awareness.

Value Assessment

Rating: good

The contract value of $30 million for Phase A of the Space Fence program appears reasonable given the complexity and strategic importance of space surveillance. Benchmarking against similar large-scale defense system development contracts suggests that this figure falls within expected ranges for initial phases of such ambitious projects. The firm fixed-price structure provides a degree of cost certainty for the government, although the ultimate value will depend on the successful completion of deliverables.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The presence of three bidders (no) suggests a healthy level of competition for this significant defense contract. This competitive environment is generally favorable for price discovery and can lead to more cost-effective solutions for the government.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by driving down costs and encouraging innovative solutions from multiple contractors.

Public Impact

The primary beneficiaries are the Department of Defense and the U.S. Air Force, who will gain enhanced capabilities for tracking objects in space. The services delivered include the development and initial implementation phases (SDR) for the Space Fence system, crucial for maintaining space situational awareness. The geographic impact is national, supporting U.S. interests in space, with potential global implications for space traffic management. Workforce implications may include specialized engineering, manufacturing, and project management roles within Raytheon and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen technical challenges arise during development.
Dependence on a single prime contractor (Raytheon) for critical space infrastructure.
Long-term sustainment costs for the Space Fence system are not detailed in this award.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Firm fixed-price contract type provides cost control and predictability.
Raytheon's established track record in defense systems development.
The contract supports a critical national security capability for space domain awareness.

Sector Analysis

The Space Fence program falls within the broader aerospace and defense sector, specifically focusing on advanced sensor and surveillance systems. This sector is characterized by high R&D investment, long development cycles, and significant government procurement. The market for space surveillance technology is driven by increasing concerns over space debris, satellite collisions, and the need for robust tracking of both friendly and adversarial space assets. Comparable spending benchmarks would involve other major radar and satellite tracking system procurements by defense agencies.

Small Business Impact

The contract details do not indicate a specific small business set-aside. However, as a large prime contract awarded to Raytheon Company, there is an expectation that Raytheon will engage small businesses as subcontractors to fulfill portions of the contract. The extent of small business participation will be crucial for assessing the broader economic impact on the small business ecosystem within the defense supply chain.

Oversight & Accountability

Oversight for this contract will primarily be managed by the Department of the Air Force, likely through contracting officers and program management offices. Accountability measures are embedded in the firm fixed-price contract terms, requiring Raytheon to deliver specified outcomes within the agreed budget. Transparency is generally maintained through contract award announcements and reporting requirements, though detailed project specifics may be sensitive.

Related Government Programs

Space Surveillance Network (SSN)
Missile Defense Agency Programs
Satellite Ground Systems
Advanced Radar Systems Development
National Reconnaissance Office (NRO) Contracts

Risk Flags

Potential for schedule delays due to technological complexity.
Risk of cost overruns in a fixed-price development contract.
Dependence on a single contractor for a critical national security system.
Ensuring accuracy and reliability of tracking for a vast number of objects.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.0 million to RAYTHEON COMPANY. SPACE FENCE PHASE A SDR

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

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 $30.0 million.

What is the period of performance?

Start: 2009-06-11. End: 2010-12-10.

What is Raytheon Company's track record with similar large-scale defense system development contracts?

Raytheon Company has a long and extensive history of developing and delivering complex defense systems for the U.S. military and allied nations. They are a major player in areas such as radar, missile systems, command and control, and intelligence, surveillance, and reconnaissance (ISR). Notable programs include the Patriot missile defense system, various airborne radar platforms, and contributions to satellite systems. Their experience with large, multi-year, fixed-price development contracts is substantial, providing a strong foundation for managing programs like Space Fence. However, like any large defense contractor, they have also faced scrutiny and challenges on specific programs related to cost, schedule, and performance, underscoring the importance of robust oversight for new initiatives.

How does the $30 million award for Space Fence Phase A SDR compare to the total estimated cost of the Space Fence program?

The $30 million awarded for Phase A SDR (System Design and Demonstration/Development) represents an initial investment in the Space Fence program. The total estimated cost for the entire Space Fence program, which includes subsequent phases of production, deployment, and sustainment, is significantly higher. While specific total program cost figures can fluctuate and are often subject to change based on program evolution and congressional appropriations, earlier estimates and discussions around Space Fence have placed the overall program cost in the hundreds of millions, potentially exceeding a billion dollars over its lifecycle. Therefore, this $30 million award is a foundational component, not the entirety of the program's financial commitment.

What are the primary risks associated with the development and implementation of the Space Fence system?

The primary risks associated with the Space Fence system development are multifaceted. Technically, integrating advanced radar technology with sophisticated data processing and command and control systems presents significant challenges. Ensuring the system's accuracy and reliability in tracking a vast and growing number of space objects, from debris to active satellites, is critical. Programmatically, risks include potential cost overruns due to the complexity and evolving requirements, schedule delays stemming from technological hurdles or supply chain issues, and performance risks if the system does not meet its stringent operational requirements. Geopolitically, the system's capabilities could also raise concerns among international partners and adversaries regarding space domain awareness and potential dual-use applications.

What is the expected impact of the Space Fence program on U.S. space domain awareness capabilities?

The Space Fence program is expected to dramatically enhance U.S. space domain awareness (SDA) capabilities. Its primary objective is to provide a more comprehensive and accurate tracking and cataloging of objects orbiting the Earth, including smaller debris that current systems may miss. This improved situational awareness is crucial for protecting U.S. space assets, enabling safer space operations, and providing critical intelligence on the space environment. By offering greater precision and coverage, Space Fence will support collision avoidance maneuvers, enhance threat detection, and contribute to the overall security and sustainability of the space domain, which is increasingly vital for national security, economic activity, and scientific endeavors.

How has spending on space surveillance and tracking systems evolved over the past decade?

Spending on space surveillance and tracking (SST) systems has seen a notable increase over the past decade, driven by growing concerns about space debris, the proliferation of satellites, and the strategic importance of space. Historically, funding was more focused on maintaining existing ground-based radar and optical sensors. However, recent years have seen increased investment in upgrading these capabilities, developing new sensor technologies, and enhancing data processing and dissemination to improve space situational awareness. Programs like Space Fence represent a significant leap in this evolution, moving towards more robust, integrated, and capable systems. This trend reflects a broader recognition within defense and intelligence communities of the critical need for comprehensive SDA.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 528 BOSTON POST RD, SUDBURY, MA, 05

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

Financial Breakdown

Contract Ceiling: $30,000,000

Exercised Options: $30,000,000

Current Obligation: $30,000,000

Timeline