DoD Awards Raytheon $19.1M for Navigation Systems Amidst Limited Competition

Contract Overview

Contract Amount: $19,119,900 ($19.1M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2020-07-15

End Date: 2024-08-31

Contract Duration: 1,508 days

Daily Burn Rate: $12.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: TTGTS UPDATE

Place of Performance

Location: TUCSON, PIMA County, ARIZONA, 85756

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $19.1 million to RAYTHEON COMPANY for work described as: TTGTS UPDATE Key points: 1. Significant contract value of $19.1 million awarded to a major defense contractor. 2. Limited competition raises questions about potential price inflation and market efficiency. 3. Contract duration of over 1500 days suggests a long-term need for these systems. 4. The sector focuses on critical navigation and guidance instruments for defense.

Value Assessment

Rating: fair

The Cost Plus Fixed Fee contract type can lead to higher costs if not managed tightly. Benchmarking against similar contracts for navigation systems is difficult without more detailed cost breakdowns, but the awarded amount seems substantial for the duration.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was 'NOT COMPETED', indicating a sole-source or limited competition scenario. This limits price discovery and potentially leads to higher costs for taxpayers compared to a fully competitive process.

Taxpayer Impact: The lack of robust competition may result in taxpayers paying a premium for these essential navigation systems.

Public Impact

Ensures continued operational capability for critical defense navigation systems. Supports a major defense contractor and its supply chain. Highlights potential areas for improved procurement strategies to foster competition.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Cost-plus contract type
Long contract duration

Positive Signals

Essential defense capability
Award to established contractor

Sector Analysis

This contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector. Spending in this area is crucial for national security, but often involves specialized, high-cost components where competition can be challenging.

Small Business Impact

There is no indication of small business involvement in this specific contract award. Future procurements could explore opportunities for small business participation in the supply chain or for specific components.

Oversight & Accountability

The 'NOT COMPETED' status warrants scrutiny to ensure the Department of Defense adequately justified the lack of competition and negotiated the best possible price. Oversight should focus on cost control and performance monitoring throughout the contract's life.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Limited competition may lead to higher prices.
Cost-plus contract type carries inherent cost overrun risks.
Lack of transparency in the procurement process.
Potential for vendor lock-in due to specialized systems.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.1 million to RAYTHEON COMPANY. TTGTS UPDATE

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $19.1 million.

What is the period of performance?

Start: 2020-07-15. End: 2024-08-31.

What specific factors led to the 'NOT COMPETED' determination for this contract, and were alternative competitive strategies considered?

The determination for 'NOT COMPETED' typically arises from situations where only one source possesses the necessary technical expertise, proprietary technology, or existing infrastructure to fulfill the requirement. Agencies must document these justifications thoroughly. Alternative strategies, such as phased competitions or market research to identify potential new sources, should ideally be explored before resorting to sole-sourcing, though urgent needs can sometimes limit these options.

How will the Cost Plus Fixed Fee structure be managed to prevent cost overruns and ensure value for taxpayer money?

Effective management of a Cost Plus Fixed Fee (CPFF) contract requires rigorous oversight of incurred costs, detailed audits, and clear performance metrics. The government contracting officer must actively monitor expenditures against the estimated cost and ensure the fixed fee remains appropriate for the effort. Regular reviews and communication with the contractor are essential to identify potential cost drivers early and implement mitigation strategies.

What is the projected impact of these navigation systems on overall Department of Defense operational effectiveness and readiness?

Reliable navigation, detection, and guidance systems are fundamental to the successful execution of a wide range of military operations, from intelligence, surveillance, and reconnaissance to tactical deployment and logistics. Ensuring the continued availability and performance of these systems directly supports force readiness and enhances the effectiveness of platforms and personnel operating in complex environments.

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: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rockwell Collins Australia PTY Limited

Address: 2000 E EL SEGUNDO BLVD, EL SEGUNDO, CA, 90245

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: $19,119,900

Exercised Options: $19,119,900

Current Obligation: $19,119,900

Actual Outlays: $431,432

Subaward Activity

Number of Subawards: 32

Total Subaward Amount: $8,909,233

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001915G0003

IDV Type: BOA

Timeline