DoD's $10.9M DARPA research contract awarded to Northrop Grumman for advanced physical sciences R&D

Contract Overview

Contract Amount: $10,896,351 ($10.9M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2024-05-10

End Date: 2026-05-15

Contract Duration: 735 days

Daily Burn Rate: $14.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: DARPA RESEARCH PROJECT

Place of Performance

Location: REDONDO BEACH, LOS ANGELES County, CALIFORNIA, 90278

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $10.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: DARPA RESEARCH PROJECT Key points: 1. Contract focuses on cutting-edge research, aligning with DARPA's mission to prevent technological surprise. 2. Northrop Grumman, a major defense contractor, brings significant experience to this complex R&D effort. 3. The contract's duration of 735 days suggests a substantial and involved research scope. 4. Awarded under full and open competition, indicating a broad search for qualified bidders. 5. The cost-plus-fixed-fee structure incentivizes cost control while allowing for research flexibility. 6. This award represents a small fraction of the DoD's overall R&D spending, contextualizing its scale.

Value Assessment

Rating: good

The contract's value of $10.9 million for a 735-day research project appears reasonable given the specialized nature of DARPA-funded R&D. Benchmarking against similar advanced R&D contracts is challenging due to their unique technical requirements. However, the cost-plus-fixed-fee (CPFF) pricing structure is common for exploratory research where final costs are uncertain, aiming to balance contractor incentive with government oversight. The fixed fee component provides a degree of cost predictability for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition after exclusion of sources,' suggesting that while the initial solicitation was broad, specific sources may have been excluded based on pre-defined criteria, or that the competition was open but resulted in a limited number of highly qualified bidders. The presence of 3 bidders indicates a competitive environment, though the exact level of competition is not fully detailed by this number alone. This approach aims to ensure the best value is obtained through a structured bidding process.

Taxpayer Impact: A competitive award process, even with a limited number of bidders, generally benefits taxpayers by fostering price discovery and encouraging contractors to offer their best terms to secure the contract.

Public Impact

The primary beneficiaries are the Department of Defense and the nation, through advancements in physical sciences relevant to national security. The contract will deliver novel research findings and potentially prototypes or advanced technological concepts. The geographic impact is primarily within the contractor's facilities, likely in California, but the research outcomes have national security implications. This contract supports highly skilled R&D professionals, contributing to the specialized scientific workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in CPFF contracts if not rigorously managed.
The specialized nature of the research may limit the immediate applicability or scalability of findings.
Dependence on a single large contractor for critical R&D could pose long-term strategic risks.

Positive Signals

Award to a reputable contractor with a strong track record in defense R&D.
The use of full and open competition suggests a thorough vetting of potential solutions.
DARPA's rigorous oversight is expected to ensure research objectives are met effectively.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for advanced defense R&D is characterized by high barriers to entry, significant government investment, and a concentration of specialized firms like Northrop Grumman. Comparable spending benchmarks are difficult to establish due to the unique, often classified, nature of DARPA projects, but this award is a typical example of the agency's investment in foundational scientific exploration.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. Northrop Grumman is a large defense contractor. While large prime contractors are often required to subcontract portions of their work to small businesses, the specific subcontracting plan for this award is not detailed here. The absence of a set-aside suggests the primary focus was on securing the most capable large-scale R&D provider.

Oversight & Accountability

Oversight for this contract will be managed by the Defense Advanced Research Projects Agency (DARPA), a component of the Department of Defense known for its stringent project management and technical oversight. Accountability is built into the Cost Plus Fixed Fee structure, requiring detailed reporting and milestone achievement. Transparency is generally limited for classified or sensitive R&D projects, but DARPA ensures internal accountability through program managers and potentially Inspector General reviews if warranted.

Related Government Programs

DARPA Research Projects
Department of Defense Research and Development
Advanced Technology Development Contracts
Northrop Grumman Defense Contracts

Risk Flags

Cost Overrun Risk (CPFF)
Limited Transparency (Sensitive R&D)
Potential for Contractor Lock-in

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. DARPA RESEARCH PROJECT

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 Advanced Research Projects Agency).

What is the total obligated amount?

The obligated amount is $10.9 million.

What is the period of performance?

Start: 2024-05-10. End: 2026-05-15.

What is Northrop Grumman's track record with DARPA and similar advanced R&D contracts?

Northrop Grumman Systems Corporation has a long and extensive history of contracting with the Department of Defense, including DARPA. They are a major aerospace and defense technology company involved in a wide array of research, development, and production programs. Their track record typically includes complex, high-value contracts requiring advanced engineering and scientific expertise. While specific performance metrics for individual DARPA contracts are often not publicly disclosed due to the sensitive nature of the research, Northrop Grumman's sustained position as a prime contractor for the DoD indicates a generally reliable performance history in delivering on challenging technological objectives. Their experience spans areas like advanced materials, autonomous systems, and space technology, aligning with the broad scope of physical sciences R&D.

How does the $10.9 million value compare to other DARPA research contracts?

The $10.9 million value for this specific DARPA research contract is within a common range for many of DARPA's individual research projects. DARPA funds a diverse portfolio of research, with contract values varying significantly based on the scope, duration, and complexity of the scientific endeavor. Some DARPA projects can be much smaller, focusing on specific scientific investigations, while others, particularly those involving system development or multiple research thrusts, can reach tens or even hundreds of millions of dollars. This $10.9 million award suggests a focused, yet substantial, research effort over its 735-day period, representative of DARPA's approach to investing in high-risk, high-reward research that pushes technological boundaries.

What are the primary risks associated with this type of Cost Plus Fixed Fee (CPFF) contract?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract, like this one, is the potential for cost overruns. While the 'fixed fee' provides the contractor with a predetermined profit margin, the 'cost plus' element means the government reimburses the contractor for allowable costs incurred. If the research proves more complex or expensive than initially anticipated, the total cost to the government could exceed initial estimates. Effective risk mitigation relies heavily on robust government oversight, detailed cost tracking, and clear definition of research objectives and milestones to ensure that costs remain reasonable and aligned with the project's progress and value. Contractor efficiency and management practices are also critical.

How does the 'full and open competition after exclusion of sources' clause impact price discovery?

The 'full and open competition after exclusion of sources' clause indicates that the initial solicitation was broadly advertised to all responsible sources. However, specific sources may have been excluded based on pre-defined criteria, such as security clearances, specific technical capabilities, or past performance issues, before the final evaluation. This approach aims to balance the benefits of broad competition with the need to ensure that only highly qualified and appropriate entities participate. While it suggests a more competitive field than a sole-source award, the exclusion of certain sources could potentially limit the breadth of price discovery compared to a truly unrestricted full and open competition. The number of bidders (3) provides some indication of the competitive intensity achieved under this specific clause.

What are the implications of awarding R&D contracts to large, established firms like Northrop Grumman?

Awarding R&D contracts to large, established firms like Northrop Grumman has several implications. Positively, these companies possess significant resources, extensive infrastructure, deep technical expertise, and a proven ability to manage complex, large-scale projects. They can often undertake high-risk research with a higher probability of success due to their experience and capabilities. However, a potential downside is reduced competition in the long run, as smaller, innovative firms may struggle to compete for prime contracts. There's also a risk of complacency or less agility compared to smaller, more specialized entities. Furthermore, reliance on a few large contractors can create strategic dependencies for the government. DARPA often balances awards between large primes and smaller research institutions to mitigate these effects.

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: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HR001123S0032

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 1 SPACE PARK BLVD, REDONDO BEACH, CA, 90278

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: $32,609,174

Exercised Options: $12,753,984

Current Obligation: $10,896,351

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $3,705,532

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline