DoD Awards Northrop Grumman $220M for Missile Defense Software Development
Contract Overview
Contract Amount: $220,306,182 ($220.3M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2023-06-15
End Date: 2028-06-14
Contract Duration: 1,826 days
Daily Burn Rate: $120.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: R&D
Official Description: BOA SOFTWARE DEVELOPMENT LABOR
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35806
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $220.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: BOA SOFTWARE DEVELOPMENT LABOR Key points: 1. Significant investment in advanced missile defense capabilities. 2. Sole-source award to Northrop Grumman raises questions about competition. 3. Research and Development sector spending is substantial. 4. Potential for long-term technological advancements in defense.
Value Assessment
Rating: questionable
The contract type is Cost Plus Award Fee, which can lead to higher costs if not managed tightly. Benchmarking is difficult without specific performance metrics and comparable contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition for a $220M contract means taxpayers may not be receiving the best possible price for these critical R&D services.
Public Impact
Enhances national security through advanced missile defense technology. Supports high-tech jobs within the aerospace and defense industry. Potential for spin-off technologies benefiting other sectors. Long-term contract duration suggests sustained focus on this area.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost Plus Award Fee contract type
- Lack of small business participation
Positive Signals
- Critical national security investment
- Potential for technological innovation
Sector Analysis
This contract falls under Research and Development in the Physical, Engineering, and Life Sciences. Spending in this sector is crucial for technological advancement but requires careful oversight to ensure value.
Small Business Impact
The data indicates no small business participation in this contract. Efforts should be made to ensure opportunities for small businesses in future procurements within this sector.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure cost controls and effective performance delivery by Northrop Grumman.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
- Department of Defense Contracting
- Missile Defense Agency Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited small business involvement
- Contract duration
Tags
research-and-development-in-the-physical, department-of-defense, al, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $220.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. BOA SOFTWARE DEVELOPMENT LABOR
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 (Missile Defense Agency).
What is the total obligated amount?
The obligated amount is $220.3 million.
What is the period of performance?
Start: 2023-06-15. End: 2028-06-14.
What is the justification for awarding this significant contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs that only one contractor can fulfill. Without further details, it's difficult to assess if these criteria were met, but it necessitates scrutiny to ensure fair pricing and necessity.
How will the performance incentives in the Cost Plus Award Fee structure ensure cost-effectiveness?
The effectiveness of the award fee structure depends on clearly defined performance metrics and objective evaluation criteria. The Department of Defense must ensure these are robust and directly tied to mission success and cost control to incentivize Northrop Grumman towards efficiency and value.
What are the long-term strategic benefits of this investment in missile defense software?
This investment is crucial for maintaining a technological edge in missile defense, safeguarding national security against evolving threats. The development of advanced software could lead to more effective interception capabilities, improved threat detection, and potentially influence future military strategy and international relations.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HQ085223R0001
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 301 VOYAGER WAY NW, HUNTSVILLE, AL, 35806
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $411,274,796
Exercised Options: $392,531,841
Current Obligation: $220,306,182
Actual Outlays: $36,368,672
Subaward Activity
Number of Subawards: 122
Total Subaward Amount: $36,133,841
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2023-06-15
Current End Date: 2028-06-14
Potential End Date: 2028-06-14 00:00:00
Last Modified: 2026-01-15
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