DoD Awards $35.6M for AEGIS Modernization Kits to Raytheon Company
Contract Overview
Contract Amount: $35,660,407 ($35.7M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2021-07-19
End Date: 2025-03-25
Contract Duration: 1,345 days
Daily Burn Rate: $26.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MK 99 AEGIS MODERNIZATION KITS
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $35.7 million to RAYTHEON COMPANY for work described as: MK 99 AEGIS MODERNIZATION KITS Key points: 1. Significant investment in critical naval defense technology. 2. Sole-source award to Raytheon raises questions about competition. 3. Long contract duration (1345 days) warrants close monitoring. 4. Focus on advanced navigation and guidance systems.
Value Assessment
Rating: fair
The contract value of $35.6 million for AEGIS modernization kits appears reasonable given the specialized nature of the equipment. However, without competitive bidding, it's difficult to definitively assess if this represents the best possible price.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive procurement.
Taxpayer Impact: The lack of competition for this significant contract may result in taxpayers paying a premium for these AEGIS modernization kits.
Public Impact
Enhances naval combat capabilities through AEGIS system upgrades. Supports advanced search, detection, and navigation for naval vessels. Ensures continued operational readiness of critical defense assets.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of small business participation noted
Positive Signals
- Critical defense system modernization
- Supports advanced technology
Sector Analysis
The Department of Defense, specifically the Navy, is a major consumer of advanced systems manufacturing. Spending in this sector often involves high-value, specialized components like the AEGIS modernization kits, with significant R&D investment.
Small Business Impact
The data indicates no specific set-aside for small businesses in this sole-source award. Further analysis would be needed to determine if opportunities for small business subcontracting were explored or mandated.
Oversight & Accountability
The Department of the Navy is responsible for overseeing this contract. Given the sole-source nature and long duration, robust oversight is crucial to ensure performance and cost control.
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
- Potential for cost overruns due to sole-source nature.
- Risk of technological obsolescence over the long contract duration.
- Limited visibility into the supply chain and subcontractor performance.
- Dependency on a single contractor for critical defense components.
Tags
search-detection-navigation-guidance-aer, department-of-defense, ma, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $35.7 million to RAYTHEON COMPANY. MK 99 AEGIS MODERNIZATION 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 $35.7 million.
What is the period of performance?
Start: 2021-07-19. End: 2025-03-25.
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 or proprietary technology held by a single vendor. While not detailed here, the Department of Defense must provide a compelling rationale, such as urgent need or lack of viable alternatives, to bypass competitive processes. The impact on price and innovation necessitates careful review of such justifications.
How does the unit cost of these AEGIS modernization kits compare to similar systems or previous procurements?
Benchmarking the unit cost is challenging without competitive data or historical pricing for identical kits. The $35.6 million total award, spread over 1345 days, suggests a substantial investment per kit. A thorough review would require access to internal cost analyses or industry benchmarks for comparable naval modernization components.
What are the specific performance metrics and delivery milestones for this contract, and how will they be monitored?
Performance monitoring for this contract will likely involve tracking the delivery of modernization kits against the established schedule (2021-2025). Key milestones would include design validation, production checkpoints, and final acceptance testing. The Navy's program office will be responsible for ensuring Raytheon meets all technical specifications and delivery timelines.
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: FIRE CONTROL EQPT.
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0002420R5126
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
Address: 1001 BOSTON POST RD E, MARLBOROUGH, MA, 01752
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: $35,660,407
Exercised Options: $35,660,407
Current Obligation: $35,660,407
Actual Outlays: $804,332
Subaward Activity
Number of Subawards: 18
Total Subaward Amount: $2,945,570
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0002419G5107
IDV Type: BOA
Timeline
Start Date: 2021-07-19
Current End Date: 2025-03-25
Potential End Date: 2025-03-25 00:00:00
Last Modified: 2025-03-26
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