DoD's AVIPSS VII contract with Northrop Grumman exceeds $103M for engineering services
Contract Overview
Contract Amount: $103,342,338 ($103.3M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2018-06-22
End Date: 2023-06-22
Contract Duration: 1,826 days
Daily Burn Rate: $56.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM VII (AVIPSS VII)
Place of Performance
Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $103.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM VII (AVIPSS VII) Key points: 1. The contract value is substantial, indicating significant demand for engineering support. 2. Northrop Grumman is a major defense contractor, suggesting a competitive landscape. 3. Potential risks include cost overruns and reliance on a single large vendor. 4. The sector is Engineering Services, crucial for defense readiness.
Value Assessment
Rating: fair
The contract's Cost Plus Fixed Fee (CPFF) structure can lead to cost growth if not managed tightly. Benchmarking against similar CPFF contracts for engineering services is difficult without detailed scope and performance data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which generally promotes competitive pricing. However, the specific pricing mechanisms within the CPFF structure require careful monitoring to ensure value.
Taxpayer Impact: Taxpayer funds are utilized for essential engineering services. The CPFF structure necessitates robust oversight to prevent excessive costs and ensure efficient use of funds.
Public Impact
Supports critical Department of Defense engineering and technical services. Ensures continued operational readiness through specialized support. Impacts the defense industrial base through significant contract awards.
Waste & Efficiency Indicators
Waste Risk Score: 56 / 10
Warning Flags
- Cost Plus Fixed Fee (CPFF) pricing can incentivize contractor spending.
- Long contract duration (5 years) may reduce flexibility.
- No small business participation noted.
Positive Signals
- Awarded through full and open competition.
- Supports critical defense engineering functions.
- Experienced contractor likely provides reliable service.
Sector Analysis
This contract falls within the Engineering Services sector, which is vital for defense system development and maintenance. Spending benchmarks in this area vary widely based on complexity and duration.
Small Business Impact
The contract data indicates no specific set-aside for small businesses, and the prime contractor is a large corporation. This suggests limited direct opportunities for small businesses on this specific award.
Oversight & Accountability
The Defense Contract Management Agency (DCMA) is responsible for oversight. Robust oversight is crucial for CPFF contracts to manage costs and ensure performance objectives are met.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Cost Plus Fixed Fee (CPFF) pricing risks
- Long contract duration
- Lack of small business participation
- Potential for scope creep
- Reliance on a single large contractor
Tags
engineering-services, department-of-defense, va, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $103.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM VII (AVIPSS VII)
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 (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $103.3 million.
What is the period of performance?
Start: 2018-06-22. End: 2023-06-22.
What is the projected cost efficiency of the CPFF structure given the contract's scope?
The Cost Plus Fixed Fee (CPFF) structure's efficiency hinges on the government's ability to accurately define the scope and the contractor's ability to manage costs effectively. Without detailed performance metrics and cost breakdowns, it's challenging to project efficiency. Continuous monitoring by DCMA is essential to ensure costs remain reasonable relative to the services provided and the fixed fee earned.
What are the primary risks associated with the long duration and sole large prime contractor?
A long duration (5 years) increases the risk of scope creep, technological obsolescence, and potential price increases over time. Relying on a single large prime contractor like Northrop Grumman can limit flexibility and potentially reduce competitive pressure on pricing and innovation throughout the contract's life.
How effectively does this contract support the DoD's long-term strategic engineering goals?
This contract likely supports immediate and medium-term engineering needs for specific programs or platforms. Its effectiveness in supporting long-term strategic goals depends on how well the acquired services align with evolving defense technologies and operational requirements, and whether the contract allows for adaptation to future strategic shifts.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: FA875018R0129
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 7575 COLSHIRE DR, MCLEAN, VA, 22102
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $142,321,702
Exercised Options: $131,314,973
Current Obligation: $103,342,338
Actual Outlays: $6,036,241
Subaward Activity
Number of Subawards: 2265
Total Subaward Amount: $718,268,328
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00Q14OADU325
IDV Type: IDC
Timeline
Start Date: 2018-06-22
Current End Date: 2023-06-22
Potential End Date: 2023-06-22 00:00:00
Last Modified: 2025-10-28
More Contracts from Northrop Grumman Systems Corporation
- 200506!000026!5700!fa8214!oo-Alc/Pkme/Lmke !F4261098C0001 !A!N! !Y! !p01502!20041213!20050701!001563738!004179453!016435559!n!northrop Grumman Space & Missi!888 S 2000 E !clearfield !ut!84015!13850!011!49!clearfield !davis !utah !-000001960000!n!n!000000000000!l014!tech REP Svcs/Guided Missiles !A2 !missile and Space Systems !302 !minuteman III GRP !541330!E! !3! ! !C! ! !20200930!B! ! !A! !a!n!l!2!002!b! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! — $10.0B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-7) — $8.5B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-2) — $5.4B (Department of Defense)
- First DDT and E, Ares I-X, and Flight Tests. First Stage Will BE a Five Segment, Solid Rocket Booster Derived From the Space Shuttle Program (SSP) Solid Rocket Booster (srb)/Reusable Solid Rocket Motor (rsrm). the Contractor Shall Furnish the Necessary Management, Engineering, Labor, Facilities, Tools, Equipment, and Materials Required for First Stage Development, Qualification, Certification and Acceptance Program. Activities Include: Redesign and Testing of the Motor to Incorporate the Fifth Segment and Production of Five Full Scale Ground Static Test Motors: TWO Development Motors (dms)-And Three Qualification Motors (QMS); Structural Test Article (STA), Ground Vibration Test Motors (gvtms) and Other Development Testing; Redesign of the Avionics, Deceleration, Separation, and Flight Termination System (FTS) Subsystems; Ares I-X: Simulated Ares I Outer Mold Line/Mass Properties Using Modified Srb/Rsrm; and Three Flight Test Vehicles. TAS::80 0124::TAS — $4.4B (National Aeronautics and Space Administration)
- Federal Contract — $4.4B (Department of Defense)
View all Northrop Grumman Systems Corporation federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)