DoD's $12M R&D contract for electronics research awarded to Wolfspeed Inc. shows strong competition

Contract Overview

Contract Amount: $12,032,603 ($12.0M)

Contractor: Wolfspeed Inc

Awarding Agency: Department of Defense

Start Date: 2002-07-03

End Date: 2006-09-29

Contract Duration: 1,549 days

Daily Burn Rate: $7.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST SHARING

Sector: R&D

Official Description: 200210!001634!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001402C0250 !A!N! !N! !20020703!20050630!183252501!183252501!183252501!N!CREE, INC !4600 SILICON DRIVE !DURHAM !NC!27703!19000!063!37!DURHAM !DURHAM !N CAROLINA!+000002900000!N!N!000000000000!AC62!RDTE/ELECTRONICS & COMMUNICATION EQ-APPLIED RESEA !A7 !ELECTRONICS AND COMMUNICATION !2000!NOT DISCERNABLE OR CLASSIFIED !541710!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!T!2!003!E! !Z!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001!

Place of Performance

Location: DURHAM, DURHAM County, NORTH CAROLINA, 27703

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $12.0 million to WOLFSPEED INC for work described as: 200210!001634!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001402C0250 !A!N! !N! !20020703!20050630!183252501!183252501!183252501!N!CREE, INC !4600 SILICON DRIVE !DURHAM !NC!27703!19000!063!37!DURHAM !DURHA… Key points: 1. Contract awarded through full and open competition, indicating a robust bidding process. 2. Significant investment in applied research for electronics and communication equipment. 3. Contract duration of over 4 years suggests a substantial, long-term project. 4. Awarded by the Office of Naval Research, highlighting defense-focused technological advancement. 5. The North Carolina location of the contractor may have regional economic implications.

Value Assessment

Rating: good

The contract's value of approximately $12 million over 1549 days (roughly 4 years) for applied research in electronics and communication equipment appears reasonable given the scope. Benchmarking against similar R&D contracts in the defense sector is challenging without more specific technical details, but the competitive award process suggests a fair price was likely achieved. The cost-sharing aspect (PT: COST SHARING) could indicate shared risk and investment between the government and the contractor, potentially leading to better value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources,' which implies that after initial considerations or exclusions, the opportunity was broadly advertised and competed. The presence of multiple bidders (NO: 3) suggests a healthy level of competition for this research and development effort. This competitive environment is generally favorable for price discovery and ensuring the government receives the best value.

Taxpayer Impact: The competitive nature of this award is beneficial for taxpayers, as it likely drove down costs and encouraged innovation among potential bidders, leading to a more efficient use of public funds.

Public Impact

The primary beneficiaries are the U.S. Navy and potentially other Department of Defense branches, gaining advancements in electronics and communication technology. Services delivered include applied research and development, likely leading to improved or novel electronic systems and communication equipment. The geographic impact is centered around the contractor's location in Durham, North Carolina, potentially creating or sustaining high-tech jobs. Workforce implications include the employment of scientists, engineers, and technicians involved in cutting-edge research.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns in R&D projects if not closely managed.
Dependence on a single contractor (Wolfspeed Inc.) for specific technological advancements.
The 'exclusion of sources' clause in the competition type warrants further scrutiny to ensure no viable alternatives were unfairly excluded.

Positive Signals

Awarded through full and open competition, indicating a fair and broad selection process.
Cost-sharing arrangement can align contractor incentives with government objectives.
The contractor, Wolfspeed Inc., is a known entity in the semiconductor and electronics industry, suggesting relevant expertise.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on electronics and communication equipment. The North American Industry Classification System (NAICS) code 541710, 'Research and Development in the Physical, Engineering, and Life Sciences,' encompasses a broad range of scientific and technical services. Spending in this area is crucial for maintaining technological superiority, particularly within the defense industry. Comparable spending benchmarks are difficult to establish without detailed technical specifications, but significant government investment in defense-related R&D is common.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses (SB: false). The contractor, Wolfspeed Inc., is a large corporation. Therefore, the primary impact on small businesses would be through potential subcontracting opportunities, which are not detailed in this data. The lack of a small business set-aside suggests the competition was focused on specialized capabilities likely held by larger firms.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which ensures compliance with contract terms and quality standards. The Office of Naval Research (ONR) would also maintain program oversight. Transparency is facilitated by public contract databases, but detailed project progress and financial expenditures may be less accessible due to the nature of R&D and potential classification.

Related Government Programs

Naval Research Laboratory Contracts
Department of Defense Applied Research Programs
Electronics and Communication Technology Development
Advanced Materials Research Contracts

Risk Flags

Potential for R&D project scope creep.
Reliance on specific advanced materials or manufacturing processes.
National security implications of advanced electronics research.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.0 million to WOLFSPEED INC. 200210!001634!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001402C0250 !A!N! !N! !20020703!20050630!183252501!183252501!183252501!N!CREE, INC !4600 SILICON DRIVE !DURHAM !NC!27703!19000!063!37!DURHAM !DURHAM !N CAROLINA!+000002900000!N!N!000000000000!AC62!RDTE/ELECTRONICS & COMMUNICATION EQ-APPLIED RESEA !A7 !ELECTRONICS AND COMMUNICATION !2000!NOT DISCERNABLE OR CLASSIFIED !541710!E! !3! ! ! ! ! !99990909!B

Who is the contractor on this award?

The obligated recipient is WOLFSPEED INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $12.0 million.

What is the period of performance?

Start: 2002-07-03. End: 2006-09-29.

What is the specific technological area within electronics and communication that this contract focuses on?

The provided data indicates the contract is for 'Research and Development in the Physical, Engineering, and Life Sciences' with a Product Service Code (PSC) related to 'ELECTRONICS & COMMUNICATION EQ-APPLIED RESEA'. While the NAICS code 541710 is broad, the PSC suggests a focus on applied research for electronic and communication equipment. Specific details regarding the exact nature of the research, such as advancements in semiconductor technology, signal processing, or communication protocols, are not explicitly stated in this summary data. Further investigation into the contract's statement of work would be required for precise technical understanding.

How does the awarded amount compare to typical R&D spending for similar projects within the Navy?

Comparing the $12 million award to typical R&D spending for similar projects within the Navy is challenging without more granular data on specific research areas and project scopes. However, $12 million for a multi-year applied research contract is within a common range for significant technological development efforts. The Office of Naval Research (ONR) funds a wide spectrum of research, from basic science to applied development, with contract values varying greatly. The fact that this was competed suggests it was deemed a valuable investment. Benchmarking would ideally involve looking at contracts with identical or very similar PSCs and NAICS codes over comparable timeframes.

What are the key performance indicators (KPIs) or deliverables expected under this contract?

The provided data does not explicitly list the key performance indicators (KPIs) or specific deliverables for this contract. As an applied research and development contract, deliverables would likely include technical reports, prototypes, data analysis, feasibility studies, and potentially demonstrations of new technologies. The success of the contract would be measured against the achievement of research objectives outlined in the Statement of Work (SOW). The 'COST SHARING' (PT) aspect might also imply certain performance milestones that trigger the release of further funding or require the contractor to meet specific technical targets.

What is the track record of Wolfspeed Inc. in fulfilling government R&D contracts, particularly with the Department of Defense?

Wolfspeed Inc. (formerly Cree, Inc.) is a well-established company in the semiconductor industry, known for its work in wide-bandgap semiconductor materials like silicon carbide and gallium nitride, which are critical for high-power, high-frequency electronics. While this specific contract data doesn't detail their past performance, their industry focus aligns well with defense needs for advanced electronics. Government contract databases would provide a more comprehensive view of their historical performance, including past awards, on-time delivery, and quality ratings on other DoD or federal contracts. Their presence as a bidder and awardee suggests a recognized capability.

What is the potential for technology transition from this R&D contract into fielded military systems?

The potential for technology transition from this applied research contract into fielded military systems is generally considered moderate to high, given the nature of applied research. The focus on 'ELECTRONICS & COMMUNICATION EQ-APPLIED RESEA' suggests the work is intended to move beyond basic science towards practical applications. The Office of Naval Research (ONR) often aims to bridge the gap between laboratory discoveries and operational capabilities. The success of transition depends on factors such as the maturity of the developed technology, its relevance to evolving military requirements, and continued funding for subsequent development and integration phases.

How has federal spending in the 'Research and Development in Physical, Engineering, and Life Sciences' category (NAICS 541710) trended over the past decade?

Federal spending within the 'Research and Development in Physical, Engineering, and Life Sciences' category (NAICS 541710) has generally seen fluctuations but has remained a significant portion of overall federal R&D investment over the past decade. Defense agencies, including the Department of the Navy, are major contributors to this spending, driven by the need for technological superiority. Trends are influenced by national security priorities, budget allocations, and emerging technological challenges. While specific year-over-year data requires detailed analysis of federal budget reports and agency spending, the consistent need for innovation in areas like electronics, materials science, and engineering ensures sustained government interest and funding in this sector.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

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: BASIC RESEARCH

Offers Received: 3

Pricing Type: COST SHARING (T)

Contractor Details

Address: 4600 SILICON DRIVE, DURHAM, NC, 04

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: YES

Timeline