DoD's $31.2M Joint Standoff Weapon Broach Lethal Package contract awarded to BAE Systems lacked competition
Contract Overview
Contract Amount: $31,242,377 ($31.2M)
Contractor: BAE Systems Global Combat Systems Munitions Limited
Awarding Agency: Department of Defense
Start Date: 2008-03-31
End Date: 2015-11-18
Contract Duration: 2,788 days
Daily Burn Rate: $11.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: JOINT STANDOFF WEAPON BROACH LETHAL PACKAGE
Plain-Language Summary
Department of Defense obligated $31.2 million to BAE SYSTEMS GLOBAL COMBAT SYSTEMS MUNITIONS LIMITED for work described as: JOINT STANDOFF WEAPON BROACH LETHAL PACKAGE Key points: 1. The contract was awarded on a sole-source basis, raising questions about potential overpayment and lack of market-driven pricing. 2. With a duration of 2788 days, the long-term nature of the contract warrants scrutiny of its ongoing value. 3. The absence of competition suggests limited opportunities for innovation and cost reduction through alternative suppliers. 4. This contract falls within the Ammunition (except Small Arms) Manufacturing sector, a critical component of defense readiness. 5. The firm-fixed-price contract type provides cost certainty but does not inherently guarantee value for money without competitive pressure.
Value Assessment
Rating: questionable
Benchmarking the value of this specific 'Joint Standoff Weapon Broach Lethal Package' is challenging without detailed cost breakdowns and comparisons to similar munitions. However, the sole-source award to BAE Systems Global Combat Systems Munitions Limited for over $31 million over an extended period (2008-2015) suggests a lack of competitive pressure which often leads to higher prices. Without competing bids, it's difficult to ascertain if the government secured the best possible price and value for this critical defense component.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed. This typically occurs when only one responsible source can provide the required goods or services. The lack of competition means there were no other bidders, and therefore no direct price comparison or negotiation leverage derived from a competitive bidding process. This can limit the government's ability to secure the most cost-effective solution.
Taxpayer Impact: Taxpayers may have paid a premium for this ammunition due to the absence of competitive bidding. The government missed an opportunity to leverage market forces to drive down costs and potentially achieve better terms.
Public Impact
The primary beneficiaries are the U.S. Department of Defense, specifically units requiring the Joint Standoff Weapon. The contract delivered lethal packages for the Joint Standoff Weapon, a key munition for air-to-ground operations. The geographic impact is national, supporting military readiness across various theaters of operation. The contract supports jobs within BAE Systems Global Combat Systems Munitions Limited and its supply chain.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price discovery and potentially inflates costs.
- Long contract duration (2008-2015) without clear performance metrics makes ongoing value assessment difficult.
- Lack of competition may stifle innovation in munition technology and manufacturing processes.
Positive Signals
- Firm-fixed-price contract provides cost certainty for the government.
- Award to an established defense contractor like BAE Systems suggests a level of reliability in production.
- The contract addresses a specific, critical need for advanced munitions within the DoD.
Sector Analysis
This contract falls within the defense sector, specifically the manufacturing of ammunition. The market for advanced munitions is often characterized by high barriers to entry due to specialized technology, stringent quality requirements, and long development cycles. While specific market size data for 'Joint Standoff Weapon Broach Lethal Packages' is not publicly available, the overall defense ammunition market is substantial, with significant government spending. This contract represents a portion of that spending, focused on a specific, high-value munition.
Small Business Impact
This contract does not appear to have involved small business set-asides, as indicated by 'sb': false. There is no information provided regarding subcontracting plans or their impact on the small business ecosystem. Given the sole-source nature and the specific defense product, it's likely that the prime contractor, BAE Systems, managed the entire scope of work or utilized its established supply chain, which may or may not have included significant small business participation.
Oversight & Accountability
Oversight for this contract would have been primarily managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractors meet performance, quality, and delivery requirements. As a definitive contract, it would be subject to standard government contract administration. Transparency regarding the specific oversight activities and accountability measures for this sole-source award is limited in the provided data. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Joint Standoff Weapon (JSOW)
- Air-to-Ground Munitions
- Defense Ammunition Procurement
- BAE Systems Defense Contracts
Risk Flags
- Sole-source award
- Lack of competition
- Extended contract duration
- Limited public cost data
Tags
defense, department-of-defense, ammunition, sole-source, definitive-contract, firm-fixed-price, bae-systems, national, munitions, weapon-systems
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $31.2 million to BAE SYSTEMS GLOBAL COMBAT SYSTEMS MUNITIONS LIMITED. JOINT STANDOFF WEAPON BROACH LETHAL PACKAGE
Who is the contractor on this award?
The obligated recipient is BAE SYSTEMS GLOBAL COMBAT SYSTEMS MUNITIONS LIMITED.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $31.2 million.
What is the period of performance?
Start: 2008-03-31. End: 2015-11-18.
What is the specific performance history of BAE Systems Global Combat Systems Munitions Limited on this contract?
The provided data indicates the contract was active from March 31, 2008, to November 18, 2015, with a total award value of $31,242,377.29. As a firm-fixed-price contract, the expectation is that BAE Systems delivered the specified lethal packages within the agreed-upon cost and timeline. However, without access to contract performance reports, delivery schedules, quality assurance records, or any potential modifications or claims, a detailed assessment of their performance history on this specific contract is not possible from the given information. The long duration suggests a sustained production effort, but the absence of competition makes it harder to gauge if performance was exceptional or merely met minimum requirements.
How does the $31.2 million award compare to similar munitions contracts awarded around the same period?
Direct comparison of the $31.2 million award for 'Joint Standoff Weapon Broach Lethal Package' to similar munitions contracts is difficult without knowing the exact quantity, specifications, and technological sophistication of the delivered items. The Joint Standoff Weapon (JSOW) is a relatively advanced air-to-ground munition. Contracts for such systems can vary significantly in price based on factors like unit complexity, production volume, and specific variants. However, given the sole-source nature and the extended period of performance (nearly 8 years), this award represents a substantial investment. Without competitive bids or data on comparable sole-source awards for similar advanced munitions, it's challenging to definitively benchmark its value against market rates or other government procurements.
What are the primary risks associated with a sole-source award for critical defense components like this?
The primary risks associated with a sole-source award for critical defense components are elevated costs due to a lack of competitive pricing pressure, potential for complacency in quality or innovation from the sole provider, and a reduced ability for the government to switch suppliers if performance issues arise or if a more cost-effective alternative emerges. In this case, the $31.2 million awarded to BAE Systems for the Joint Standoff Weapon lethal packages, without competition, increases the risk that the government may have overpaid. It also means the DoD is reliant on a single source for this specific munition, potentially impacting supply chain resilience and long-term strategic flexibility.
What was the historical spending pattern for Joint Standoff Weapon lethal packages prior to and after this contract?
The provided data only details this specific contract (2008-2015) for the Joint Standoff Weapon (JSOW) Broach Lethal Package. It does not offer information on historical spending patterns before or after this period. To understand the historical context, one would need to research previous contracts for JSOW components or similar munitions awarded to BAE Systems or other manufacturers, as well as subsequent procurements of these or updated versions. Analyzing spending trends over time would reveal if this $31.2 million award was an anomaly, part of a consistent procurement strategy, or indicative of increasing/decreasing costs for this type of munition.
What is the strategic importance of the Joint Standoff Weapon and its lethal packages to the Department of Defense?
The Joint Standoff Weapon (JSOW) is a key component of the U.S. military's precision strike capability, particularly for air forces. It is a long-range, air-to-ground weapon designed to attack high-value targets from standoff ranges, thereby reducing risk to aircrews. The 'lethal package' refers to the warhead and associated components that deliver the destructive effect. The strategic importance lies in its ability to provide flexible, accurate, and survivable attack options against a wide range of targets, including fixed and moving ones, in various weather conditions. Procuring these lethal packages is crucial for maintaining the operational readiness and effectiveness of strike aircraft.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0001907R0090
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: BAE Systems PLC (UEI: 217304393)
Address: GLASCOED, USK
Business Categories: Category Business, Corporate Entity Tax Exempt, Foreign Owned, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $31,883,625
Exercised Options: $31,309,645
Current Obligation: $31,242,377
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2008-03-31
Current End Date: 2015-11-18
Potential End Date: 2015-11-18 00:00:00
Last Modified: 2016-03-24
More Contracts from BAE Systems Global Combat Systems Munitions Limited
- 200309!001145!2100!AA09 !U.S. Army Industrial Operations !daaa0903d0007 !A!N! !N!0003 !20030605!20040528!289954943!289954943!217304393!n!royal Ordnance PLC !building 20A1 !bristol !uk!bs34 !39560!163!47!kingsport !sullivan !tennessee !+000026890887!n!n!000000000000!1376!bulk Explosives !A6 !ammunition !1000!NOT Discernable or Classified !325920!E! !5!A!S! ! ! !99990909!B! ! !A! !d!n!j!1!001!n!1g!a!y!f! ! !N!C!N! ! ! !b!b!a!a!000!a!c!n! ! ! ! ! ! !0001! ! — $186.5M (Department of Defense)
- 200309!001191!2100!AA09 !U.S. Army Industrial Operations !daaa0903d0007 !A!N! !N!0004 !20030613!20030828!289954943!289954943!217304393!n!royal Ordnance PLC !building 20A1 !bristol !uk!bs34 !39560!163!47!kingsport !sullivan !tennessee !+000000076110!n!n!000000000000!1376!bulk Explosives !A6 !ammunition !1000!NOT Discernable or Classified !325920!E! !5!A!S! ! ! !99990909!B! ! !A! !d!n!j!1!001!n!1g!a!n!f! ! !N!C!N! ! ! !b!b!a!a!000!a!c!n! ! ! ! ! ! !0001! ! — $72.5M (Department of Defense)
- Augmenting Charge (AC), Live — $36.3M (Department of Defense)
- 1. the Purpose of This Action IS to Provide Funds in the Amount of $13,197,666.30 Under a Firm Fixed-Price (FFP) Type Contract Arrangement for the Manufacture of 1,455,090 Pounds of Cxm-Af-7, NSN: 1376-01-M35-0881, IAW Mil-Dtl-20065102 (AF). 2. the Unit Price of $9.07 PER Pound Reflects the Negotiated Agreement Between Norman Brown, Contracting Officer, and Jerry Hammonds, Vice President of Manufacturing, OSI, Reached 25 September 2007. This Agreement Reflects a Base Price of $7.70 PER Pound (1,455,090 X $7.70 = $11,204,193) for the Manufacture of 1,455,090 Pounds of Cxm-Af-7 and $1.37 PER Pound (1,455,090 X $1.37 = $1,993,473.30) Being Applied AS a Facility Overhead Allocation Against the Negotiated Facility USE Contract. 3. Place of Performance IS Holston Army Ammunition Plant, Kingsport, TN. 4. Contract Administration Will BE Performed by the On-Site Government ACO Staff. 5. AS a Result of the Incorporation of the Action AS Described Above, the Total Contract Amount for Delivery Order 0018 IS Herein Established AT a Firm Fixed-Price (FFP) of $13,197,666.30 - SEE Section G for Accounting Information. 6. Except AS Provided Herein, the Balance of Those Terms, Conditions and Requirements AS Specified Under Contract Number Daaa09-03-D- 0007, AS Modified to Date, Shall Remain Unchanged and in Full Force and Effect — $13.2M (Department of Defense)
View all BAE Systems Global Combat Systems Munitions Limited federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)