DoD's $459M Upgrade Early Warning Radar Contract Awarded to Northrop Grumman

Contract Overview

Contract Amount: $45,945,189 ($45.9M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2022-05-23

End Date: 2024-03-25

Contract Duration: 672 days

Daily Burn Rate: $68.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: UPGRADE EARLY WARNING RADAR (UEWR) AGILE DO

Place of Performance

Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $45.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: UPGRADE EARLY WARNING RADAR (UEWR) AGILE DO Key points: 1. Northrop Grumman secured a significant contract for radar system upgrades. 2. The contract falls under the Engineering Services sector, indicating complex technical requirements. 3. Full and open competition was utilized, suggesting a competitive bidding process. 4. The cost-plus-fixed-fee structure may present cost control challenges. 5. The project duration is substantial, spanning over two years.

Value Assessment

Rating: fair

The contract uses a Cost Plus Fixed Fee (CPFF) pricing structure. While this allows for flexibility in evolving requirements, it can lead to higher costs compared to fixed-price contracts if not managed carefully. Benchmarking against similar complex engineering service contracts is needed for a precise assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which typically fosters competitive pricing. However, the CPFF structure means the final price is not fixed upfront, and the government must actively monitor costs to ensure fair pricing and prevent overruns.

Taxpayer Impact: The use of full and open competition is generally beneficial for taxpayers by promoting market competition. However, the CPFF pricing model requires diligent oversight to ensure costs remain reasonable and do not exceed the anticipated value.

Public Impact

Enhances national defense capabilities through upgraded radar systems. Supports advanced threat detection and early warning for the Air Force. Represents a significant investment in critical military infrastructure. Potential for technological advancements in radar systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) pricing can lead to cost overruns.
Long contract duration may increase risk of scope creep or changing requirements.
Reliance on a single contractor for critical system upgrades.

Positive Signals

Awarded through full and open competition, promoting market engagement.
Addresses a critical national security need for early warning systems.
Contract supports modernization of vital defense infrastructure.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), which involves the application of engineering principles to design, develop, and test systems. Spending in this sector is often characterized by high technical complexity and significant R&D investment, with benchmarks varying widely based on project scope and criticality.

Small Business Impact

The data indicates this contract was awarded to Northrop Grumman Systems Corporation, a large business. There is no explicit mention of small business participation in this specific award notice. Further analysis would be needed to determine if small businesses were involved as subcontractors.

Oversight & Accountability

The contract was awarded by the Department of the Air Force, part of the Department of Defense. Oversight will likely involve program management offices responsible for defense acquisitions, ensuring adherence to contract terms, cost controls, and performance metrics. The CPFF structure necessitates robust government oversight to manage costs effectively.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Cost Plus Fixed Fee (CPFF) pricing model.
Potential for cost overruns due to CPFF structure.
Long contract duration (over 2 years).
Reliance on a single large contractor for critical defense system.
Lack of explicit small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $45.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. UPGRADE EARLY WARNING RADAR (UEWR) AGILE DO

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 $45.9 million.

What is the period of performance?

Start: 2022-05-23. End: 2024-03-25.

What is the estimated total cost ceiling for this CPFF contract, and how does it compare to similar radar upgrade projects?

The provided data does not specify a total cost ceiling for this Cost Plus Fixed Fee (CPFF) contract, only the awarded amount of $459,451,890. CPFF contracts have a fixed fee but allow costs to vary. A comprehensive comparison would require access to detailed cost breakdowns and data from comparable radar upgrade programs, considering factors like system complexity, technological advancements, and contract duration.

What specific risks are associated with the 'Upgrade Early Warning Radar (UEWR)' system, and how does this contract mitigate them?

Risks associated with the UEWR system could include technological obsolescence, integration challenges with existing infrastructure, and potential vulnerabilities to cyber threats. This contract aims to mitigate these by upgrading the system, presumably incorporating newer technologies and enhanced security features. However, the CPFF structure itself introduces financial risk if cost overruns are not managed effectively through diligent oversight.

How will the effectiveness of the upgraded radar system be measured, and what are the key performance indicators (KPIs)?

The effectiveness of the upgraded radar system will likely be measured against specific performance metrics outlined in the contract's Statement of Work (SOW). Key Performance Indicators (KPIs) could include improved detection range, enhanced tracking accuracy, reduced false alarm rates, increased system reliability, and faster data processing times. Formal testing and validation phases post-upgrade will be crucial for assessing effectiveness.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: HARDWARE AND ABRASIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 14119 SULLYFIELD CIR STE A, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $60,163,349

Exercised Options: $60,163,349

Current Obligation: $45,945,189

Actual Outlays: $2,890,550

Subaward Activity

Number of Subawards: 26

Total Subaward Amount: $6,959,375

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA872318D0001

IDV Type: IDC

Timeline