Leidos awarded $780M contract for counter-UAS engineering, with Air Force as primary customer
Contract Overview
Contract Amount: $77,952,495 ($78.0M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2021-08-27
End Date: 2026-09-29
Contract Duration: 1,859 days
Daily Burn Rate: $41.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: COUNTER SMALL UNMANNED AERIAL SYSTEMS ENGINEERING AND INTEGRATION CONTRACT
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $78.0 million to LEIDOS, INC. for work described as: COUNTER SMALL UNMANNED AERIAL SYSTEMS ENGINEERING AND INTEGRATION CONTRACT Key points: 1. Contract value of $779.5M over its period of performance suggests significant investment in counter-unmanned aerial systems (C-UAS) capabilities. 2. The full and open competition indicates a broad market search, potentially leading to competitive pricing. 3. The Cost Plus Fixed Fee (CPFF) contract type carries inherent risk of cost overruns, requiring robust oversight. 4. This contract aligns with a growing national security focus on C-UAS technologies. 5. The primary agency is the Department of Defense, specifically the Air Force, highlighting its critical role in this domain. 6. The contract duration of nearly five years allows for sustained development and integration efforts.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without specific performance metrics or comparable C-UAS engineering contracts. The CPFF structure means the government pays for allowable costs plus a fixed fee, which can lead to higher final costs than fixed-price contracts if not managed carefully. The total award amount of $779.5M over approximately five years averages to about $156M annually, which is substantial but needs to be evaluated against the scope and complexity of the C-UAS solutions being developed and integrated.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting that multiple offerors had the opportunity to bid. The presence of 5 bids (no=5) indicates a reasonable level of competition for this specialized engineering service. This approach is generally favored as it allows the government to solicit proposals from the widest possible range of qualified contractors, theoretically leading to the best value.
Taxpayer Impact: A full and open competition is beneficial for taxpayers as it increases the likelihood of receiving competitive pricing and innovative solutions, preventing potential overpayment that could occur with less competitive solicitations.
Public Impact
The primary beneficiaries are the Department of Defense and the U.S. Air Force, receiving advanced counter-unmanned aerial systems engineering and integration services. The contract supports the development and deployment of technologies to detect, track, identify, and defeat unmanned aerial systems. Geographic impact is likely nationwide, supporting various military installations and operational theaters where C-UAS capabilities are required. Workforce implications include specialized engineering, software development, and systems integration roles, potentially creating or sustaining high-skill jobs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not closely monitored.
- The complexity of C-UAS technology integration presents inherent technical risks.
- Reliance on a single prime contractor (Leidos) for broad engineering and integration may limit agility.
- The long contract duration could lead to technology obsolescence if not managed proactively.
Positive Signals
- Awarded through full and open competition, suggesting a robust selection process.
- Leidos is a large, established defense contractor with significant experience in complex systems integration.
- The contract addresses a critical and evolving national security requirement.
- The substantial award value indicates a commitment to developing advanced C-UAS capabilities.
Sector Analysis
The counter-unmanned aerial systems (C-UAS) market is a rapidly growing segment within the broader aerospace and defense sector, driven by the proliferation of drone technology. This contract fits within the defense engineering services sub-sector, focusing on the integration and development of specialized technologies. Comparable spending benchmarks are difficult to pinpoint due to the niche nature of C-UAS, but overall defense R&D and systems integration spending runs into billions annually.
Small Business Impact
This contract does not appear to have a small business set-aside component (sb=false). While Leidos, Inc. is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting will depend on Leidos's subcontracting plan and the specific needs for specialized C-UAS components or services.
Oversight & Accountability
Oversight for this contract will primarily fall under the Department of the Air Force contracting and program management offices. Given the CPFF structure, rigorous financial oversight and auditing will be crucial to ensure costs are allowable and reasonable. Transparency will be maintained through contract reporting mechanisms, and potential issues may be addressed by the Defense Contract Audit Agency (DCAA) or the Department of Defense Inspector General.
Related Government Programs
- DoD Counter-UAS Strategy
- Air Force Next Generation Air Dominance (NGAD)
- Defense Advanced Research Projects Agency (DARPA) programs
- Joint Counter-Small Unmanned Aircraft Systems Office (JCO)
- Intelligence, Surveillance, and Reconnaissance (ISR) systems
Risk Flags
- Cost Plus Fixed Fee contract type
- Potential for cost overruns
- Complexity of C-UAS integration
- Long contract duration
Tags
defense, department-of-defense, air-force, engineering-services, counter-uas, full-and-open-competition, cost-plus-fixed-fee, leidos, virginia, systems-integration, technology-development
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $78.0 million to LEIDOS, INC.. COUNTER SMALL UNMANNED AERIAL SYSTEMS ENGINEERING AND INTEGRATION CONTRACT
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
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 $78.0 million.
What is the period of performance?
Start: 2021-08-27. End: 2026-09-29.
What is Leidos's track record with similar large-scale defense engineering and integration contracts?
Leidos, Inc. has a substantial track record in delivering complex engineering, integration, and IT services to the Department of Defense and other federal agencies. They have been involved in numerous large-scale programs, including command and control systems, intelligence analysis platforms, and advanced sensor integration. Their experience spans various domains, often involving significant system complexity and long program durations. While specific details on past C-UAS related contracts are not provided here, their general profile suggests they possess the organizational capacity and technical expertise to manage contracts of this magnitude. Past performance reviews and contract closeouts would offer more granular insights into their success rates and adherence to cost and schedule on similar endeavors.
How does the $779.5M award compare to other recent counter-UAS system development contracts?
The $779.5M award for counter-UAS engineering and integration is a significant investment, reflecting the growing priority placed on this capability. While direct comparisons are difficult without knowing the exact scope and deliverables, other recent contracts in the C-UAS space have ranged from tens of millions for specific technology development or procurement to hundreds of millions for broader system integration and deployment. For instance, the Army has awarded contracts for C-UAS systems, and other branches are investing in detection, mitigation, and command-and-control solutions. This Leidos contract appears to be on the higher end, suggesting a comprehensive approach to engineering and integration across multiple C-UAS functions, potentially encompassing hardware, software, and operational concept development over its multi-year period.
What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this C-UAS program?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract is that the final cost to the government can exceed initial estimates. While the 'fixed fee' component provides the contractor with a set profit margin, the 'cost plus' element means the government reimburses the contractor for all allowable costs incurred. If the C-UAS engineering and integration prove more complex or require more resources than anticipated, the total cost to the government will increase. This necessitates robust government oversight to scrutinize incurred costs, ensure they are reasonable and allocable to the contract, and prevent scope creep that inflates expenses without commensurate value. Effective cost control and performance monitoring are critical to mitigating these risks.
How effective is full and open competition likely to be in ensuring value for money on this specialized engineering contract?
Full and open competition is generally the most effective method for ensuring value for money, as it allows the widest possible pool of qualified contractors to compete. In this case, the Department of the Air Force received 5 bids, indicating a healthy level of competition for this specialized C-UAS engineering and integration work. This competitive pressure incentivizes bidders to offer competitive pricing and innovative solutions to win the contract. However, the value for money achieved will also depend on the clarity of the requirements, the effectiveness of the evaluation criteria used by the Air Force, and the contractor's ability to execute the complex engineering tasks efficiently within the CPFF structure. Ongoing oversight will be key to realizing the full value.
What is the historical spending trend for counter-UAS related contracts within the Department of Defense?
Historical spending on counter-unmanned aerial systems (C-UAS) within the Department of Defense has seen a significant upward trend over the past decade. Initially, spending was relatively modest, focused on research and early technology development. As the threat posed by small, commercially available drones and more sophisticated unmanned systems became apparent, funding rapidly increased across all military branches. This includes investments in detection systems (radar, electro-optical/infrared, acoustic), electronic warfare jammers, directed energy weapons, kinetic defeat mechanisms, and integrated command-and-control software. The substantial award to Leidos for engineering and integration reflects this ongoing, substantial investment trend, which is expected to continue as C-UAS technology rapidly evolves.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 5
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 1750 PRESIDENTS ST FL 4, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $115,098,221
Exercised Options: $115,098,221
Current Obligation: $77,952,495
Actual Outlays: $798,886
Subaward Activity
Number of Subawards: 60
Total Subaward Amount: $27,364,946
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00Q14OADU322
IDV Type: IDC
Timeline
Start Date: 2021-08-27
Current End Date: 2026-09-29
Potential End Date: 2026-09-29 00:00:00
Last Modified: 2026-01-16
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