DoD awards $83M for SBX Development to Raytheon Company, a sole-source contract
Contract Overview
Contract Amount: $82,950,162 ($83.0M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2020-11-01
End Date: 2024-09-30
Contract Duration: 1,429 days
Daily Burn Rate: $58.0K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: US SBX DEVELOPMENT
Place of Performance
Location: WOBURN, MIDDLESEX County, MASSACHUSETTS, 01801
Plain-Language Summary
Department of Defense obligated $83.0 million to RAYTHEON COMPANY for work described as: US SBX DEVELOPMENT Key points: 1. Contract awarded to a single, large business vendor. 2. Focus on advanced missile defense technology development. 3. Potential for cost overruns due to Cost Plus Award Fee structure. 4. Limited transparency on pricing due to sole-source nature.
Value Assessment
Rating: questionable
The Cost Plus Award Fee (CPAF) structure can incentivize performance but also carries a risk of higher costs if not managed tightly. Benchmarking is difficult without competitive data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, which limits price discovery and potentially leads to higher costs for taxpayers. The sole-source award suggests a lack of available alternatives or a strategic decision to use a specific vendor.
Taxpayer Impact: The absence of competition raises concerns about whether the government achieved the best possible price for this critical defense system.
Public Impact
Enhances national security through advanced missile defense capabilities. Supports high-tech jobs within the defense sector. Potential for technological advancements in radar and sensor systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition.
- Cost Plus Award Fee structure can increase costs.
- Lack of transparency in pricing.
- No small business participation noted.
Positive Signals
- Addresses critical national security needs.
- Awarded to a known defense contractor with relevant expertise.
- Potential for significant technological advancement.
Sector Analysis
This contract falls within the defense sector, specifically focusing on advanced radar and sensor systems for missile defense. Spending in this area is critical for national security, but often involves high costs and complex technologies.
Small Business Impact
There is no indication of small business participation in this contract. The award to a large prime contractor suggests that subcontracting opportunities for small businesses may be limited or not explicitly tracked in this data.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure cost control and performance. The Missile Defense Agency should actively monitor expenditures and contractor performance against award fee criteria.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Missile Defense Agency Programs
Risk Flags
- Sole-source award.
- Cost Plus Award Fee contract type.
- Lack of small business participation.
- High dollar value contract.
- Critical defense technology.
Tags
search-detection-navigation-guidance-aer, department-of-defense, ma, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $83.0 million to RAYTHEON COMPANY. US SBX DEVELOPMENT
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Missile Defense Agency).
What is the total obligated amount?
The obligated amount is $83.0 million.
What is the period of performance?
Start: 2020-11-01. End: 2024-09-30.
What is the justification for the sole-source award, and were alternative solutions considered?
The justification for a sole-source award typically involves unique capabilities, critical national security needs, or a lack of viable alternatives. Without further documentation, it's difficult to assess if alternatives were thoroughly explored or if the chosen vendor's capabilities are truly unique and indispensable for the SBX Development program.
How will the Cost Plus Award Fee structure be managed to prevent cost overruns and ensure value for taxpayer money?
Effective management of a CPAF contract requires clear, measurable performance metrics and rigorous oversight. The agency must establish objective criteria for award fees, regularly assess contractor performance against these metrics, and ensure that fee amounts are directly tied to achieved outcomes and cost efficiencies.
What are the key performance indicators (KPIs) for this contract, and how will their achievement be measured?
Key performance indicators for a contract like SBX Development would likely include technical milestones, system performance metrics (e.g., detection range, accuracy), integration timelines, and adherence to budget constraints. The agency needs robust testing and validation processes to objectively measure the contractor's progress and success against these defined KPIs.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HQ014717R0012
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
Address: 225 PRESIDENTIAL WAY, WOBURN, MA, 01801
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: $83,845,515
Exercised Options: $83,845,515
Current Obligation: $82,950,162
Actual Outlays: $56,254,777
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HQ014718D0002
IDV Type: IDC
Timeline
Start Date: 2020-11-01
Current End Date: 2024-09-30
Potential End Date: 2024-09-30 00:00:00
Last Modified: 2025-09-24
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