DoD Awards Raytheon $431.9M for NGJ-MB LRIP1/2, a Sole-Source Acquisition
Contract Overview
Contract Amount: $431,856,039 ($431.9M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2021-07-02
End Date: 2026-12-31
Contract Duration: 2,008 days
Daily Burn Rate: $215.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: NGJ-MB LRIP1/2
Place of Performance
Location: EL SEGUNDO, LOS ANGELES County, CALIFORNIA, 90245
Plain-Language Summary
Department of Defense obligated $431.9 million to RAYTHEON COMPANY for work described as: NGJ-MB LRIP1/2 Key points: 1. Significant investment in advanced naval capabilities. 2. Sole-source award to Raytheon raises competition concerns. 3. Long-term contract duration may impact future pricing. 4. Focus on critical defense systems highlights sector importance.
Value Assessment
Rating: questionable
The contract value of $431.9M for LRIP1/2 is substantial. Without competitive benchmarks, assessing its value for money is difficult. The fixed-price incentive structure aims to control costs, but the lack of competition is a primary concern.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating a lack of full and open competition. This method limits price discovery and may lead to higher costs for taxpayers compared to a competitive procurement.
Taxpayer Impact: The absence of competition in this sole-source award potentially results in a higher cost to taxpayers than if multiple vendors had vied for the contract.
Public Impact
Enhances naval electronic warfare capabilities. Supports advanced technology development for the U.S. Navy. Long-term commitment to a single contractor for a critical system.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition.
- Potential for cost overruns due to lack of competitive pressure.
- Long contract duration (through 2026) may not reflect market changes.
Positive Signals
- Acquires critical defense technology.
- Fixed-price incentive contract aims for cost control.
- Supports a key defense contractor.
Sector Analysis
This contract falls within the Defense sector, specifically in the manufacturing of advanced electronic warfare systems. Spending in this area is critical for maintaining technological superiority, but often involves high costs due to specialized R&D and limited suppliers.
Small Business Impact
The contract was awarded to Raytheon Company, a large prime contractor. There is no indication of subcontracting opportunities for small businesses within the provided data, which is common for sole-source, high-value defense contracts.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the government is receiving fair value. Transparency regarding the justification for sole-source procurement is crucial for accountability.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency on sole-source justification
- Long-term contract dependency
Tags
search-detection-navigation-guidance-aer, department-of-defense, ca, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $431.9 million to RAYTHEON COMPANY. NGJ-MB LRIP1/2
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $431.9 million.
What is the period of performance?
Start: 2021-07-02. End: 2026-12-31.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. Agencies must document these justifications thoroughly. Alternative competitive strategies, such as phased procurements or seeking multiple sources for different components, should be explored to maximize competition where feasible, even in specialized defense acquisitions.
How does the fixed-price incentive structure mitigate risks associated with sole-source procurement?
A fixed-price incentive (FPI) contract shares cost risks and benefits between the government and the contractor. It establishes a target cost, target profit, and a price ceiling. If costs are lower than the target, both parties share the savings. If costs exceed the target, the contractor absorbs a larger portion of the overrun up to the ceiling. This structure incentivizes the contractor to control costs, offering some mitigation against the risks inherent in sole-source awards.
What is the long-term strategic value of this sole-source acquisition for the Department of the Navy?
This sole-source acquisition provides the Department of the Navy with a critical Next Generation Jammer (NGJ) capability, essential for modern electronic warfare and mission success. While competition is generally preferred, securing this specific, advanced technology from a sole provider ensures timely delivery of a capability deemed vital for naval aviation superiority. The long-term value lies in maintaining operational effectiveness and deterring adversaries.
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: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0001919R0068
Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp
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: $431,856,039
Exercised Options: $431,856,039
Current Obligation: $431,856,039
Subaward Activity
Number of Subawards: 180
Total Subaward Amount: $69,334,315
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2021-07-02
Current End Date: 2026-12-31
Potential End Date: 2026-12-31 00:00:00
Last Modified: 2025-12-15
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