DoD Awards $316M CEC System Production Contract to L3 Technologies Amidst Full and Open Competition
Contract Overview
Contract Amount: $315,901,176 ($315.9M)
Contractor: L3 Technologies, Inc.
Awarding Agency: Department of Defense
Start Date: 2022-07-18
End Date: 2026-09-29
Contract Duration: 1,534 days
Daily Burn Rate: $205.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: CEC SYSTEM PRODUCTION AND REPAIR
Place of Performance
Location: SEMINOLE, PINELLAS County, FLORIDA, 33777
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $315.9 million to L3 TECHNOLOGIES, INC. for work described as: CEC SYSTEM PRODUCTION AND REPAIR Key points: 1. The contract value of $315.9M for CEC System Production and Repair is substantial, indicating significant investment in naval defense capabilities. 2. L3 Technologies, Inc. secured this award through full and open competition, suggesting a competitive bidding process. 3. The contract duration of approximately 4 years (July 2022 - Sept 2026) allows for sustained production and support. 4. The primary sector is Defense, specifically focusing on Search, Detection, Navigation, Guidance, and related instrument manufacturing.
Value Assessment
Rating: good
The contract value of $315.9M appears reasonable for a large-scale production and repair effort for advanced defense systems. Benchmarking against similar complex electronic system contracts would provide a more precise assessment, but the firm-fixed-price structure suggests cost control is a priority.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The award was made under full and open competition, indicating that multiple bidders had the opportunity to compete. This method is generally expected to drive competitive pricing and ensure the government receives the best value.
Taxpayer Impact: The competitive nature of this award suggests that taxpayer funds are being utilized efficiently, with pricing likely optimized through the bidding process.
Public Impact
Enhances naval operational capabilities through advanced CEC systems. Supports technological advancement in defense electronics manufacturing. Contributes to the readiness and effectiveness of the U.S. Navy fleet. Potential for job creation within the defense manufacturing sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if production complexities are underestimated.
- Dependence on a single prime contractor for critical system components.
- Risk of schedule delays impacting fleet readiness.
Positive Signals
- Awarded under full and open competition.
- Firm-fixed-price contract structure.
- Long-term contract provides stability for production and support.
Sector Analysis
This contract falls within the Defense sector, specifically focusing on advanced electronic systems for naval applications. Spending benchmarks for similar large-scale production and repair contracts for complex defense equipment are typically in the hundreds of millions of dollars, aligning with this award's value.
Small Business Impact
While the prime contractor is L3 Technologies, Inc., the contract details do not specify subcontracting goals for small businesses. Further investigation would be needed to determine the extent of small business participation in this award.
Oversight & Accountability
The contract is managed by the Department of the Navy, a component of the Department of Defense, which has established oversight mechanisms for defense procurements. The firm-fixed-price nature of the contract provides a degree of cost control, but ongoing monitoring of performance and delivery is crucial.
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
- Contract awarded under full and open competition.
- Firm-fixed-price contract structure.
- Significant investment in critical defense technology.
- Long contract duration provides stability.
- Potential for technological obsolescence over the contract period.
- Dependence on a single supplier for critical components.
Tags
search-detection-navigation-guidance-aer, department-of-defense, fl, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $315.9 million to L3 TECHNOLOGIES, INC.. CEC SYSTEM PRODUCTION AND REPAIR
Who is the contractor on this award?
The obligated recipient is L3 TECHNOLOGIES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $315.9 million.
What is the period of performance?
Start: 2022-07-18. End: 2026-09-29.
What is the specific capability enhancement provided by the CEC System Production and Repair contract?
The CEC (Coordinated Electronic Combat) system is crucial for enhancing naval warfare capabilities by enabling seamless data sharing and coordinated engagement among multiple platforms. This contract ensures the continued production and maintenance of these vital systems, improving the Navy's situational awareness and combat effectiveness through integrated sensor and weapon data.
What are the primary risks associated with the firm-fixed-price contract for this complex defense system?
The primary risk with a firm-fixed-price contract for complex systems like CEC is that the contractor may face unforeseen production challenges or material cost increases, potentially leading to reduced profit margins or, in extreme cases, contract disputes. The government's risk is that the fixed price might not reflect the true cost if the contractor underestimated complexities, though the competitive bidding process aims to mitigate this.
How does this contract contribute to the overall effectiveness and readiness of the U.S. Navy?
This contract is vital for maintaining and enhancing the operational effectiveness and readiness of the U.S. Navy. By ensuring the availability of updated and functional CEC systems, it directly supports the Navy's ability to conduct complex missions, improve target acquisition, and execute coordinated defensive and offensive operations, thereby bolstering overall fleet readiness.
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: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0002421R5208
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 FEDERAL ST, CAMDEN, NJ, 08103
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: $397,696,526
Exercised Options: $348,848,484
Current Obligation: $315,901,176
Actual Outlays: $1,180,937
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2022-07-18
Current End Date: 2026-09-29
Potential End Date: 2027-09-29 00:00:00
Last Modified: 2026-01-13
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