Navy awards Raytheon $7.77M for Common CDPS, impacting aircraft parts manufacturing

Contract Overview

Contract Amount: $7,770,059 ($7.8M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2023-09-14

End Date: 2026-04-30

Contract Duration: 959 days

Daily Burn Rate: $8.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: MV/CMV/CV COMMON CDPS

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46240

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $7.8 million to RAYTHEON COMPANY for work described as: MV/CMV/CV COMMON CDPS Key points: 1. Significant contract value for specialized aircraft parts. 2. Raytheon Company is the sole awardee, raising competition concerns. 3. Potential risks associated with sole-source procurement. 4. Spending falls within the 'Other Aircraft Parts' manufacturing sector.

Value Assessment

Rating: fair

The contract's Cost Plus Fixed Fee structure requires careful monitoring to ensure costs remain reasonable. Benchmarking against similar sole-source contracts for specialized aircraft components is difficult without more data.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.

Taxpayer Impact: The lack of competition may result in a higher cost to taxpayers for these essential aircraft parts.

Public Impact

Impacts readiness and maintenance of Navy aircraft. Affects the supply chain for specialized aerospace components. Highlights potential reliance on a single contractor for critical systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source procurement
Cost Plus Fixed Fee contract type
Lack of small business participation

Positive Signals

Award to established defense contractor
Addresses critical aircraft parts need

Sector Analysis

This contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector. Spending benchmarks for sole-source contracts in this niche area are difficult to establish due to limited public data.

Small Business Impact

The data indicates no small business participation in this contract. This is a missed opportunity to support small businesses within the defense supply chain.

Oversight & Accountability

The Department of the Navy is responsible for oversight. The sole-source nature of this award warrants close scrutiny to ensure fair pricing and effective delivery.

Related Government Programs

Other Aircraft Parts and Auxiliary Equipment Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award limits competition.
Potential for cost overruns with CPFF structure.
Lack of small business involvement.
Dependency on a single supplier for critical parts.
Limited transparency in pricing due to non-competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $7.8 million to RAYTHEON COMPANY. MV/CMV/CV COMMON CDPS

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 $7.8 million.

What is the period of performance?

Start: 2023-09-14. End: 2026-04-30.

What is the justification for the sole-source award of the Common CDPS contract to Raytheon Company?

The justification for a sole-source award typically involves factors such as unique capabilities, proprietary technology, or urgent need where only one source can fulfill the requirement. Without specific documentation, it's difficult to ascertain the precise rationale, but it likely relates to specialized requirements for the Common CDPS that only Raytheon can meet at this time.

How does the Cost Plus Fixed Fee (CPFF) contract structure mitigate risks for the government in this sole-source scenario?

A CPFF contract aims to control costs by setting a fixed fee for the contractor's profit, regardless of the final cost of the work. While this incentivizes the contractor to manage costs, the government still bears the risk of cost overruns. For sole-source awards, robust government oversight is crucial to ensure the 'cost' portion remains reasonable and justified.

What is the long-term strategic implication of awarding critical aircraft parts contracts on a sole-source basis?

Long-term sole-source awards can lead to vendor lock-in, stifle innovation, and potentially increase costs over time due to a lack of competitive pressure. It may also hinder the development of alternative suppliers and reduce overall market competition, potentially impacting national security if a single point of failure exists in the supply chain.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0001923R0119

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

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: $7,770,059

Exercised Options: $7,770,059

Current Obligation: $7,770,059

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001920G0007

IDV Type: BOA

Timeline