Raytheon Awarded $22.8M for MK 73 MOD 3 ORDALT Kits by Department of the Navy

Contract Overview

Contract Amount: $22,842,501 ($22.8M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2011-12-27

End Date: 2014-04-15

Contract Duration: 840 days

Daily Burn Rate: $27.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MK 73 MOD 3 ORDALT KITS

Place of Performance

Location: PORTSMOUTH, NEWPORT County, RHODE ISLAND, 02871

State: Rhode Island Government Spending

Plain-Language Summary

Department of Defense obligated $22.8 million to RAYTHEON COMPANY for work described as: MK 73 MOD 3 ORDALT KITS Key points: 1. High contract value for specialized ordnance alteration kits. 2. Sole-source award to Raytheon Company raises competition concerns. 3. Potential risk associated with limited competition and single supplier. 4. Spending falls within the Guided Missile and Space Vehicle Manufacturing sector.

Value Assessment

Rating: questionable

The contract value of $22.8 million for MK 73 MOD 3 ORDALT Kits is significant. Without comparable contract data or a competitive bidding process, it's difficult to assess if this price is optimal or if it represents fair market value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating a lack of competition. This method limits price discovery and may result in higher costs for the government compared to a competed procurement.

Taxpayer Impact: The absence of competition likely means taxpayers are paying a premium for these specialized kits, as there was no market pressure to drive down prices.

Public Impact

Ensures operational readiness of naval guided missile systems. Supports the Department of the Navy's strategic defense capabilities. Potential for cost overruns due to sole-source nature. Impacts the supply chain for critical defense components.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Potential for inflated pricing

Positive Signals

Supports critical defense systems
Established supplier relationship

Sector Analysis

This contract falls under the Guided Missile and Space Vehicle Manufacturing sector, a highly specialized area within defense. Spending in this sector often involves significant R&D and high-value components, making benchmarks difficult without specific product comparisons.

Small Business Impact

The data indicates this contract was not awarded to small businesses. The sole-source nature of the award further suggests that opportunities for small business participation were likely limited or non-existent in this specific procurement.

Oversight & Accountability

The sole-source award warrants scrutiny to ensure the government obtained the best possible value. Further oversight may be needed to confirm the necessity of a sole-source approach and to explore future competitive opportunities.

Related Government Programs

Guided Missile and Space Vehicle Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award limits price competition.
Potential for higher costs due to lack of competition.
Dependency on a single supplier.
Lack of transparency in pricing justification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.8 million to RAYTHEON COMPANY. MK 73 MOD 3 ORDALT KITS

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 $22.8 million.

What is the period of performance?

Start: 2011-12-27. End: 2014-04-15.

What is the justification for the sole-source award, and were alternative competitive strategies considered?

The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs that only one contractor can meet. For this contract, the Department of the Navy would need to provide documentation detailing why Raytheon was the only viable source and why competition was not feasible or would be detrimental to national security.

How does the per-unit cost of these ORDALT kits compare to similar systems or previous procurements?

Without access to specific per-unit cost data or benchmarks for comparable ordnance alteration kits, it is challenging to definitively assess value. The lack of competition makes direct comparison difficult, but historical pricing data for similar modifications or components from Raytheon or other manufacturers could provide some insight.

What is the long-term strategic impact of relying on a single supplier for these critical components?

Long-term reliance on a single supplier can create vulnerabilities, including potential supply chain disruptions, price escalation, and reduced innovation. It also limits the government's leverage in future negotiations. Diversifying suppliers or developing alternative solutions should be considered to mitigate these risks.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing

Product/Service Code: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0002411R5464

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1847 W MAIN RD, PORTSMOUTH, RI, 01

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: $22,842,501

Exercised Options: $22,842,501

Current Obligation: $22,842,501

Contract Characteristics

Cost or Pricing Data: YES

Timeline