DoD Awards Raytheon $117M for Counter-UAS Radar Program, Facing Potential Cost Overruns

Contract Overview

Contract Amount: $117,108,784 ($117.1M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2019-06-24

End Date: 2025-11-30

Contract Duration: 2,351 days

Daily Burn Rate: $49.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: CET 19-952, SOLDIER PERIMETER DEFENSE RAPID ADVANCED C-UAS RADAR PROGRAM (SPDRACR)

Place of Performance

Location: EL SEGUNDO, LOS ANGELES County, CALIFORNIA, 90245

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $117.1 million to RAYTHEON COMPANY for work described as: CET 19-952, SOLDIER PERIMETER DEFENSE RAPID ADVANCED C-UAS RADAR PROGRAM (SPDRACR) Key points: 1. Significant investment in advanced defense technology for perimeter security. 2. Sole awardee, Raytheon, suggests specialized capabilities or limited market. 3. Cost-plus-fixed-fee contract type carries inherent risk of cost escalation. 4. Program duration extends over 6 years, indicating complexity and long-term need.

Value Assessment

Rating: questionable

The Cost Plus Fixed Fee (CPFF) contract structure, while allowing for flexibility in R&D, can lead to higher final costs than fixed-price contracts. The initial award amount of $117M is a baseline, and the contract's duration suggests potential for significant cost growth.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is positive for price discovery. However, the specific nature of advanced C-UAS radar may limit the number of truly capable bidders, potentially impacting the competitiveness of the final award.

Taxpayer Impact: Taxpayer funds are allocated for critical defense capabilities. The CPFF structure necessitates close monitoring to ensure cost efficiency and prevent unnecessary spending.

Public Impact

Enhances national security by providing advanced counter-unmanned aerial system capabilities. Supports technological advancement in defense electronics and radar systems. Potential for job creation within Raytheon and its supply chain. Ensures readiness against evolving aerial threats.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost escalation risk due to CPFF contract type.
Limited visibility into specific performance metrics and milestones.
Potential for sole-source follow-on contracts if competition is not maintained.

Positive Signals

Addresses a critical and evolving national security threat.
Leverages advanced technology for defense applications.
Awarded through full and open competition.

Sector Analysis

This contract falls within the Engineering Services sector, specifically related to defense electronics and radar systems. Spending in this area is driven by modernization efforts and the need for advanced threat detection capabilities, with benchmarks varying widely based on technology sophistication.

Small Business Impact

The data indicates this contract was not set aside for small businesses, and the prime contractor is Raytheon Company, a large defense contractor. There is no information provided on subcontracting opportunities for small businesses within this specific award.

Oversight & Accountability

The Department of Defense, through the Defense Microelectronics Activity, is responsible for oversight. The CPFF contract type requires diligent monitoring of costs, progress, and adherence to technical specifications to ensure accountability and value for taxpayer money.

Related Government Programs

Engineering Services
Department of Defense Contracting
Defense Microelectronics Activity Programs

Risk Flags

Cost Overruns
Technological Obsolescence
Limited Competition Potential
Performance Shortfalls
Integration Challenges

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $117.1 million to RAYTHEON COMPANY. CET 19-952, SOLDIER PERIMETER DEFENSE RAPID ADVANCED C-UAS RADAR PROGRAM (SPDRACR)

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Microelectronics Activity).

What is the total obligated amount?

The obligated amount is $117.1 million.

What is the period of performance?

Start: 2019-06-24. End: 2025-11-30.

What is the projected total cost of the SPDRACR program upon completion, considering the CPFF structure and program duration?

The initial award is $117,108,784, with an estimated completion date in November 2025. However, the Cost Plus Fixed Fee (CPFF) contract type allows for cost increases. Without detailed cost projections and performance data, the final cost is uncertain and could significantly exceed the initial award amount, requiring robust oversight.

What specific risks does the 'full and open competition' designation mitigate, and what risks remain given the specialized nature of C-UAS radar?

Full and open competition aims to ensure the government receives the best value by allowing all responsible sources to compete, thereby driving down prices and fostering innovation. However, the highly specialized nature of advanced C-UAS radar may mean only a few companies possess the necessary technical expertise, potentially limiting the competitive landscape and the government's leverage.

How effectively will this radar program address the evolving threat of unmanned aerial systems, and what are the key performance indicators for success?

The program's effectiveness hinges on its ability to detect, track, and potentially neutralize a wide range of UAS threats in complex environments. Key performance indicators should include detection range, accuracy, classification capabilities, response time, and integration with existing defense systems. Continuous evaluation against evolving threats is crucial.

Industry Classification

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

Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ072715R0001

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 2000 E EL SEGUNDO BLVD, EL SEGUNDO, CA, 90245

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: $117,108,784

Exercised Options: $117,108,784

Current Obligation: $117,108,784

Actual Outlays: $1,392,248

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ072716D0006

IDV Type: IDC

Timeline