Raytheon Company awarded $36.4M for anti-jam modem development, with a significant portion allocated to radio and wireless equipment manufacturing

Contract Overview

Contract Amount: $36,396,768 ($36.4M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2020-03-27

End Date: 2022-10-15

Contract Duration: 932 days

Daily Burn Rate: $39.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE INCENTIVE

Sector: Defense

Official Description: AIR FORCE AND ARMY ANTI-JAM MODEM DEVELOPMENT AND TEST PRODUCTION

Place of Performance

Location: MARLBOROUGH, MIDDLESEX County, MASSACHUSETTS, 01752

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $36.4 million to RAYTHEON COMPANY for work described as: AIR FORCE AND ARMY ANTI-JAM MODEM DEVELOPMENT AND TEST PRODUCTION Key points: 1. The contract focuses on developing and testing anti-jam modems, crucial for secure military communications. 2. A substantial portion of the contract value is tied to the manufacturing of specialized wireless communication equipment. 3. The fixed-price incentive contract structure aims to balance cost control with performance incentives. 4. The contract duration of 932 days suggests a complex development and testing cycle. 5. The award was made by the Department of the Air Force, indicating a specific need within that branch. 6. The North American Industry Classification System (NAICS) code 334220 points to the manufacturing sector for wireless communication equipment.

Value Assessment

Rating: good

The total award of $36.4 million for anti-jam modem development and test production appears reasonable given the specialized nature of the technology and the fixed-price incentive contract type. Benchmarking against similar advanced communication system development contracts would provide further context, but the scope suggests a significant R&D and production effort. The contract's duration of 932 days also implies a substantial undertaking.

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 vendors had the opportunity to bid. The presence of a single award does not necessarily imply a lack of competition, as the government selects the best value proposal. Further details on the number of bids received would offer a clearer picture of the competitive landscape.

Taxpayer Impact: Full and open competition generally leads to better price discovery and potentially lower costs for taxpayers by encouraging a wider range of offers.

Public Impact

The primary beneficiaries are the U.S. Air Force and Army, who will receive advanced anti-jam modems. The services delivered include development, testing, and production of critical communication hardware. The contract's geographic impact is primarily within Massachusetts, where Raytheon Company is located. The contract supports a specialized workforce in radio and wireless communications equipment manufacturing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if performance incentives are not met or if development challenges arise.
Reliance on a single contractor for a critical technology could pose supply chain risks.
The fixed-price incentive structure requires careful monitoring to ensure value for money.

Positive Signals

Awarded through full and open competition, suggesting a competitive bidding process.
The fixed-price incentive contract type aims to align contractor and government interests for successful outcomes.
Development of anti-jam technology enhances military communication security and resilience.

Sector Analysis

This contract falls within the defense electronics and manufacturing sector, specifically focusing on advanced communication systems. The market for such specialized equipment is driven by military modernization efforts and the need for secure, resilient communication capabilities in contested environments. Comparable spending benchmarks would typically involve other development and production contracts for electronic warfare, secure communications, or signal processing systems within the Department of Defense.

Small Business Impact

There is no indication that this contract included small business set-asides, nor is there information on subcontracting plans for small businesses. As a large prime contractor, Raytheon Company may engage small businesses for specific components or services, but the primary award is not directed towards them. Further analysis of subcontracting reports would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management office within the Department of the Air Force. Accountability measures are embedded in the fixed-price incentive contract terms, linking payment to performance and cost targets. Transparency is facilitated through contract award databases, though detailed performance metrics and IG oversight specifics are not publicly available without further inquiry.

Related Government Programs

Military Communication Systems
Electronic Warfare Systems
Radio and Wireless Equipment Manufacturing
Department of Defense Research and Development
Secure Communications Technology

Risk Flags

Potential for cost overruns due to fixed-price incentive structure.
Technical complexity of anti-jam modem development.
Reliance on a single contractor for critical technology.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $36.4 million to RAYTHEON COMPANY. AIR FORCE AND ARMY ANTI-JAM MODEM DEVELOPMENT AND TEST PRODUCTION

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 $36.4 million.

What is the period of performance?

Start: 2020-03-27. End: 2022-10-15.

What is Raytheon Company's track record with similar Department of Defense contracts, particularly in communication systems development?

Raytheon Company, now part of RTX, has a long and extensive history of contracting with the Department of Defense, particularly in areas related to aerospace, defense, and advanced technologies. They are a major provider of various defense systems, including radar, missiles, and communication equipment. Their track record with communication systems development is robust, encompassing a wide range of projects from tactical radios to sophisticated satellite communication terminals. Specific to anti-jam capabilities, Raytheon has been involved in numerous programs aimed at enhancing signal resilience against electronic warfare threats. Analyzing their past performance on fixed-price incentive contracts and projects with similar technical complexities would provide a more granular view of their capabilities and reliability in delivering such specialized systems.

How does the $36.4 million award compare to other anti-jam modem development contracts awarded by the DoD in the last five years?

Comparing the $36.4 million award for anti-jam modem development and test production to other similar contracts requires access to a comprehensive database of defense procurements. However, based on general knowledge of defense spending, this amount appears to be within a moderate range for a development and initial production contract of specialized military hardware. Larger, full-scale production runs or contracts for more complex, integrated systems could easily exceed this figure by orders of magnitude. Conversely, purely research-focused contracts might be smaller. The specific technical requirements, maturity of the technology, and the number of units to be developed and tested would heavily influence the contract value. Without direct comparative data on similar anti-jam modem programs, it's difficult to definitively benchmark this award, but it suggests a significant but not exceptionally large investment in this specific capability.

What are the primary risks associated with the fixed-price incentive (FPI) contract type for this anti-jam modem project?

The primary risks associated with a Fixed-Price Incentive (FPI) contract for this anti-jam modem project revolve around the balance between cost control and performance achievement. For the government, the risk is that the final cost could exceed the target price if the contractor incurs higher-than-expected costs, although the incentive fee structure aims to limit this. There's also a risk that the contractor might prioritize meeting the minimum performance requirements to secure their profit, potentially sacrificing optimal performance or innovation if the incentives aren't structured effectively. For the contractor, the risk lies in underestimating the development and production costs or encountering unforeseen technical challenges that drive costs up, potentially reducing their profit margin or even leading to a loss if the final cost exceeds the ceiling price. Effective negotiation of the target cost, target profit, incentive fee rate, and ceiling price is crucial to mitigate these risks for both parties.

What is the expected program effectiveness and impact of these anti-jam modems on Air Force and Army operations?

The expected program effectiveness of these anti-jam modems is to significantly enhance the reliability and security of military communications in environments saturated with electronic warfare (EW) threats. Anti-jam technology works by employing techniques to detect and mitigate jamming signals, ensuring that critical command, control, and data links remain operational. For the Air Force and Army, this translates to improved situational awareness, more robust C2 (Command and Control) capabilities, and the ability to maintain communication during contested operations. The impact is a substantial increase in operational resilience, reducing the risk of communication failures that could jeopardize missions, personnel safety, and overall mission success. This is particularly crucial in modern warfare scenarios where EW capabilities are increasingly sophisticated.

How has historical spending on radio and wireless communications equipment manufacturing by the Department of Defense trended, and where does this contract fit?

Historical spending by the Department of Defense (DoD) on radio and wireless communications equipment manufacturing has generally trended upwards, driven by the continuous need for advanced, secure, and resilient communication systems to support evolving military operations and counter emerging threats. This sector is critical for maintaining information superiority and command and control across all domains. Contracts in this area range from tactical radios for individual soldiers to complex networked systems for aircraft, ships, and ground installations. The $36.4 million award for anti-jam modems fits within this trend as a specific investment in a high-priority area of communication technology – enhancing resistance to electronic interference. It represents a component of the broader DoD's investment in modernizing its communication infrastructure and electronic warfare capabilities.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: FA880819R0002

Offers Received: 1

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 1001 BOSTON POST RD E, MARLBOROUGH, MA, 01752

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: $37,800,237

Exercised Options: $37,800,237

Current Obligation: $36,396,768

Actual Outlays: $2,613,074

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $2,134,436

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA880820D0001

IDV Type: IDC

Timeline