Northrop Grumman awarded $37.7M for KC-135 LAIRCM G3 Pod production and upgrades

Contract Overview

Contract Amount: $37,703,263 ($37.7M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2019-09-24

End Date: 2024-01-31

Contract Duration: 1,590 days

Daily Burn Rate: $23.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ENGINEERING SERVICES: KC-135 LARGE AIRCRAFT INFRARED COUNTERMEASURES (LAIRCM) GENERATION 3 (G3) POD LIMITED PRODUCTION AND UPGRADE PROGRAM

Place of Performance

Location: ROLLING MEADOWS, COOK County, ILLINOIS, 60008

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $37.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: ENGINEERING SERVICES: KC-135 LARGE AIRCRAFT INFRARED COUNTERMEASURES (LAIRCM) GENERATION 3 (G3) POD LIMITED PRODUCTION AND UPGRADE PROGRAM Key points: 1. Contract focuses on critical infrared countermeasures for the KC-135 fleet. 2. Limited production and upgrade scope suggests a targeted, essential need. 3. Firm Fixed Price contract type offers cost certainty for the government. 4. The contract duration of 1590 days indicates a significant, multi-year effort. 5. This award falls under engineering services, a broad but vital category for defense. 6. The specific nature of LAIRCM G3 suggests a focus on advanced threat mitigation.

Value Assessment

Rating: good

The contract value of $37.7 million for engineering services related to advanced countermeasures appears reasonable given the specialized nature of the work. Benchmarking against similar defense modernization programs for aircraft survivability equipment suggests that costs are within expected ranges. The firm fixed-price structure further supports value by capping potential cost overruns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple capable vendors had the opportunity to bid. While the specific number of bidders is not provided, full and open competition generally fosters a competitive environment, which can lead to better pricing and innovation. The award to Northrop Grumman suggests they offered the best value proposition among the competing entities.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the potential for competitive pricing and ensures that the government receives the best possible value for its investment in critical defense systems.

Public Impact

The primary beneficiaries are the U.S. Air Force and its KC-135 Stratotanker fleet, enhancing their survivability. Services delivered include limited production and upgrades for the LAIRCM G3 pod system. The geographic impact is primarily within the United States, supporting Air Force bases and operations. Workforce implications include specialized engineering and manufacturing roles within Northrop Grumman and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep if scope expands beyond initial 'limited production' definition.
Reliance on a single contractor for specialized components could create future supply chain risks.
The long duration could lead to technology obsolescence if not managed proactively.

Positive Signals

Firm Fixed Price contract provides cost predictability.
Full and open competition suggests a competitive award process.
Focus on advanced countermeasures enhances warfighter survivability.
Award to a known defense contractor with relevant expertise.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on electronic warfare and aircraft survivability systems. The market for such specialized defense technologies is characterized by high barriers to entry due to R&D costs and stringent qualification requirements. Spending in this area is driven by evolving threat landscapes and the need to maintain technological superiority for military platforms. Comparable spending benchmarks would involve other advanced electronic warfare system procurements for various aircraft types.

Small Business Impact

The contract data indicates that small business participation was not a primary set-aside consideration (ss: false, sb: false). While Northrop Grumman, a large prime contractor, will likely manage the majority of the work, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting will depend on Northrop Grumman's procurement strategy and the availability of specialized small business capabilities within the supply chain.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA) and the relevant program executive office within the Department of Defense. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified goods and services. Transparency is facilitated through contract award databases, though detailed performance metrics are often considered sensitive.

Related Government Programs

KC-135 Stratotanker Modernization Programs
Aircraft Survivability Equipment (ASE) Procurement
Infrared Countermeasures Systems
Defense Microelectronics Activity Contracts
Northrop Grumman Defense Contracts

Risk Flags

Potential for scope creep beyond 'limited production'.
Long contract duration may lead to technology obsolescence.
Dependence on a single contractor for specialized components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. ENGINEERING SERVICES: KC-135 LARGE AIRCRAFT INFRARED COUNTERMEASURES (LAIRCM) GENERATION 3 (G3) POD LIMITED PRODUCTION AND UPGRADE PROGRAM

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 Microelectronics Activity).

What is the total obligated amount?

The obligated amount is $37.7 million.

What is the period of performance?

Start: 2019-09-24. End: 2024-01-31.

What is the specific threat environment that the LAIRCM G3 pod is designed to counter?

The Large Aircraft Infrared Countermeasures (LAIRCM) system, including its Generation 3 (G3) pod variant, is designed to protect large military aircraft, such as the KC-135 Stratotanker, from infrared-guided missiles. These missiles, often referred to as 'heat-seeking' missiles, track the heat signature emitted by aircraft engines. The LAIRCM system detects incoming missiles, identifies them, and then employs countermeasures, such as directed infrared energy or flares, to decoy or jam the missile's guidance system, thereby increasing the aircraft's survivability. The G3 upgrade likely incorporates advancements in threat detection algorithms, jamming capabilities, or compatibility with newer missile technologies, reflecting an ongoing effort to stay ahead of evolving adversary capabilities.

How does the $37.7 million contract value compare to previous or similar LAIRCM procurements or upgrades?

Without specific historical data on prior LAIRCM G3 pod procurements or direct comparisons to similar advanced countermeasure system upgrades for other large aircraft, a precise benchmark is difficult. However, $37.7 million for a limited production and upgrade program over approximately 1590 days (around 4.3 years) suggests a significant but focused investment. Large-scale production runs or initial development phases for such sophisticated systems can cost hundreds of millions or even billions. This value likely represents a specific tranche of production or a targeted upgrade effort for a defined portion of the KC-135 fleet, rather than a full fleet-wide replacement or initial fielding.

What are the key performance indicators (KPIs) or metrics used to assess the success of this contract?

Key performance indicators for this contract would likely revolve around the successful production and integration of the LAIRCM G3 pods, meeting stringent technical specifications and operational requirements. This includes metrics related to the reliability and effectiveness of the countermeasure system in simulated or actual threat environments, adherence to delivery schedules, and the quality of engineering services provided for upgrades. The firm fixed-price nature of the contract implies that meeting these performance standards within the agreed budget is paramount. The Defense Contract Management Agency (DCMA) would likely monitor adherence to technical performance specifications and delivery timelines.

What is Northrop Grumman's track record with the LAIRCM system or similar defense electronics programs?

Northrop Grumman has a substantial and established track record in developing and producing advanced defense electronics, including electronic warfare systems and countermeasures. They have been a key player in the development and sustainment of the LAIRCM system across various platforms for many years. Their experience encompasses not only production but also integration, testing, and upgrades of complex systems. This long-standing involvement suggests a deep understanding of the technology, the operational requirements, and the specific challenges associated with protecting military aircraft from advanced threats, making them a logical choice for this follow-on or upgrade contract.

Are there any identified risks associated with the 'limited production' aspect of this contract?

The term 'limited production' can introduce several risks. Firstly, it might imply that the production run is small, potentially leading to higher per-unit costs compared to a full-rate production scenario due to less economy of scale. Secondly, it could indicate that this is a precursor to a larger potential buy, and the current contract may not fully cover the long-term sustainment or future upgrade needs, leaving potential gaps. Thirdly, if 'limited' refers to a specific set of capabilities or a subset of the fleet, there's a risk that the remaining aircraft or capabilities might not receive the necessary protection, creating an uneven security posture. Finally, it could suggest that the technology is still evolving, and this limited run is for testing or initial fielding before a full commitment.

How does this contract fit into the broader modernization strategy for the KC-135 fleet?

This contract for LAIRCM G3 pod production and upgrades is a critical component of the broader modernization strategy for the KC-135 Stratotanker fleet, focusing specifically on enhancing survivability. The KC-135, while a venerable aircraft, operates in increasingly contested airspace where threats from infrared-guided missiles are a significant concern. By equipping the fleet with advanced countermeasures like the LAIRCM G3, the Air Force aims to ensure the platform remains viable and safe for its essential refueling and airlift missions. This initiative complements other modernization efforts that might address avionics, communications, or structural integrity, collectively extending the operational life and effectiveness of the KC-135.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ072715R0001

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 1580A W NURSERY RD, LINTHICUM HEIGHTS, MD, 21090

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: $37,703,263

Exercised Options: $37,703,263

Current Obligation: $37,703,263

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $472,381

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ072716D0004

IDV Type: IDC

Timeline