DoD Awards Northrop Grumman $11.2M for RPCS Controller, Extending to 2028
Contract Overview
Contract Amount: $11,237,695 ($11.2M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2024-08-22
End Date: 2028-02-28
Contract Duration: 1,285 days
Daily Burn Rate: $8.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: RPCS CONTROLLER
Place of Performance
Location: MELBOURNE, BREVARD County, FLORIDA, 32904
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $11.2 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: RPCS CONTROLLER Key points: 1. Significant contract value awarded to a major defense contractor. 2. Limited competition raises questions about price discovery and potential overspending. 3. Long contract duration (over 4 years) increases long-term financial exposure. 4. Sector focus on aircraft parts manufacturing.
Value Assessment
Rating: questionable
The contract is a Cost Plus Fixed Fee type, which can incentivize higher costs. Without competitive bidding, it's difficult to assess if the $11.2M price is reasonable compared to market rates for similar RPCS controllers.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This lack of competition limits the government's ability to secure the best possible price and may lead to higher costs for taxpayers.
Taxpayer Impact: The absence of competition suggests taxpayers may not be receiving the most cost-effective solution for the RPCS controller.
Public Impact
Taxpayers may be paying a premium due to the lack of competitive bidding. The extended contract period means sustained spending on this specific item. Dependence on a single contractor for critical aircraft parts could pose supply chain risks.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Long contract duration
Positive Signals
- Award to established defense contractor
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically for aircraft parts. Spending in this area is critical for national security but often involves complex, high-value procurements.
Small Business Impact
The awardee, Northrop Grumman Systems Corporation, is a large business. There is no indication that small businesses were involved in this specific contract, missing an opportunity for their participation.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure costs are managed effectively and the contractor is meeting all performance requirements within the agreed-upon fee structure.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Cost-plus contract type
- Long contract duration
- Potential for price creep
- Limited oversight visibility due to sole-source nature
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, fl, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $11.2 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. RPCS CONTROLLER
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $11.2 million.
What is the period of performance?
Start: 2024-08-22. End: 2028-02-28.
What is the justification for the sole-source award, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities or urgent needs. Without further details, it's crucial for the Department of the Navy to rigorously validate the necessity and ensure robust cost controls are in place. Regular audits and performance reviews are essential to mitigate risks associated with non-competitive contracts and protect taxpayer interests.
What are the potential risks associated with a long-term, sole-source contract for aircraft parts?
A long-term, sole-source contract for aircraft parts carries risks of price escalation over time, reduced incentive for the contractor to innovate or improve efficiency, and potential supply chain vulnerabilities if the sole provider faces disruptions. It also limits the government's flexibility to adopt newer technologies or seek more competitive pricing should market conditions change.
How does the Cost Plus Fixed Fee structure impact the government's ability to control spending on this contract?
The Cost Plus Fixed Fee (CPFF) structure reimburses the contractor for allowable costs plus a predetermined fixed fee. While the fee is fixed, the total cost can still fluctuate based on actual expenses. This structure can provide less incentive for cost control compared to fixed-price contracts, requiring diligent government oversight to scrutinize costs and prevent overruns.
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
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 2000 W NASA BLVD, MELBOURNE, FL, 32904
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: $11,237,695
Exercised Options: $11,237,695
Current Obligation: $11,237,695
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $4,107,961
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0001920G0005
IDV Type: BOA
Timeline
Start Date: 2024-08-22
Current End Date: 2028-02-28
Potential End Date: 2028-02-28 00:00:00
Last Modified: 2026-01-15
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