DoD Awards Raytheon $100.5M for AN/TPY-2 Radar Development Task Order

Contract Overview

Contract Amount: $100,547,470 ($100.5M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2024-11-01

End Date: 2026-11-30

Contract Duration: 759 days

Daily Burn Rate: $132.5K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: US AN/TPY-2 DEVELOPMENT - TASK ORDER 0009 AWARD

Place of Performance

Location: WOBURN, MIDDLESEX County, MASSACHUSETTS, 01801

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $100.5 million to RAYTHEON COMPANY for work described as: US AN/TPY-2 DEVELOPMENT - TASK ORDER 0009 AWARD Key points: 1. Significant investment in advanced radar technology for missile defense. 2. Sole-source award to Raytheon, a major defense contractor. 3. Potential for cost overruns given Cost Plus Award Fee contract type. 4. Focus on Search, Detection, Navigation, Guidance systems.

Value Assessment

Rating: questionable

The Cost Plus Award Fee (CPAF) contract type allows for contractor reimbursement of costs plus an award fee based on performance. Without clear benchmarks or competitive pricing, assessing value is difficult. The $132M BR figure may offer some comparison, but its applicability to this specific task order is unclear.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This task order was not competed, indicating a sole-source award to Raytheon Company. This lack of competition limits price discovery and may result in higher costs for the government compared to a fully competed scenario.

Taxpayer Impact: Taxpayer funds are being directed to a single contractor without competitive pressure, potentially leading to less favorable pricing.

Public Impact

Enhances US missile defense capabilities. Supports advanced radar system development and sustainment. Impacts national security through improved threat detection. Funds a critical component of the Missile Defense Agency's portfolio.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition.
Cost Plus Award Fee contract type can lead to higher costs.
Lack of detailed cost breakdown for this specific task order.

Positive Signals

Supports critical national security mission.
Award to established defense contractor with relevant expertise.

Sector Analysis

This contract falls within the Defense sector, specifically focusing on advanced radar systems for missile defense. Spending in this area is driven by national security priorities and technological advancements in threat detection and engagement.

Small Business Impact

The awardee is Raytheon Company, a large defense contractor. There is no indication that small businesses were involved in this specific task order, either as prime contractors or subcontractors.

Oversight & Accountability

The Department of Defense, through the Missile Defense Agency, is responsible for overseeing this contract. The CPAF structure includes performance incentives, but the effectiveness of oversight in ensuring optimal value for taxpayer dollars is a key consideration.

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.
Potential for cost overruns.
Lack of transparency in specific performance metrics for award fee.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $100.5 million to RAYTHEON COMPANY. US AN/TPY-2 DEVELOPMENT - TASK ORDER 0009 AWARD

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 $100.5 million.

What is the period of performance?

Start: 2024-11-01. End: 2026-11-30.

What specific performance metrics are used to determine the award fee for Raytheon under this Cost Plus Award Fee contract, and how do these metrics ensure optimal value for the $100.5 million investm

The specific performance metrics for the award fee are not detailed in the provided data. However, for a CPAF contract, these typically relate to meeting technical requirements, schedule adherence, and cost control. The Missile Defense Agency would establish these metrics, aiming to incentivize Raytheon to achieve program objectives efficiently and effectively, thereby maximizing the value derived from the investment.

Given the sole-source nature of this award, what steps has the Department of Defense taken to ensure that the pricing is fair and reasonable, and what is the potential risk of inflated costs?

In sole-source procurements, the government typically relies on various methods to ensure fair and reasonable pricing, such as historical pricing data, independent government cost estimates, and certified cost or pricing data from the contractor. Despite these measures, the absence of competition inherently carries a risk of inflated costs, as the contractor faces less pressure to offer the most competitive price.

How does the development and sustainment of the AN/TPY-2 radar system under this task order contribute to the overall effectiveness of US missile defense capabilities, and what is the expected impact

The AN/TPY-2 radar is a critical component of the US missile defense system, providing long-range surveillance, detection, and tracking of ballistic missiles. This task order likely supports ongoing development, upgrades, or sustainment activities, ensuring the radar's continued effectiveness. Improved capabilities directly enhance the nation's ability to detect and respond to missile threats, bolstering overall national security.

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: RTX Corp

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: $148,069,664

Exercised Options: $145,930,819

Current Obligation: $100,547,470

Subaward Activity

Number of Subawards: 11

Total Subaward Amount: $3,232,706

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