DoD Awards $143.6M for Future LCAC Craft Long Lead Time Material to Textron Systems
Contract Overview
Contract Amount: $1,436,316,386 ($1.4B)
Contractor: Textron Systems Corp
Awarding Agency: Department of Defense
Start Date: 2023-08-04
End Date: 2031-10-13
Contract Duration: 2,992 days
Daily Burn Rate: $480.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: THREE FUTURE LCAC 100 CLASS CRAFT LONG LEAD TIME MATERIAL
Place of Performance
Location: NEW ORLEANS, ORLEANS County, LOUISIANA, 70129
Plain-Language Summary
Department of Defense obligated $1.44 billion to TEXTRON SYSTEMS CORP for work described as: THREE FUTURE LCAC 100 CLASS CRAFT LONG LEAD TIME MATERIAL Key points: 1. Significant investment in naval landing craft modernization. 2. Sole-source award raises questions about competition and price discovery. 3. Long contract duration (2031) presents potential for cost overruns. 4. Focus on shipbuilding and repair sector, a critical defense industry.
Value Assessment
Rating: questionable
The contract value of $143.6 million for long lead time material is substantial. Without competitive bids, it's difficult to assess if this price is optimal compared to potential market rates for similar advanced shipbuilding components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Textron Systems Corp. This limits price discovery and may result in a higher cost than if multiple vendors had submitted bids.
Taxpayer Impact: The lack of competition could lead to taxpayers potentially overpaying for these critical long lead time materials.
Public Impact
Enhances U.S. Navy's amphibious assault capabilities. Supports advanced shipbuilding technology and domestic manufacturing. Long-term commitment to a specific defense contractor.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of price competition
Positive Signals
- Acquisition of critical defense assets
- Investment in advanced naval technology
Sector Analysis
This contract falls within the shipbuilding and repairing sector, a vital but often high-cost area of defense spending. Benchmarks for long lead time material in this specialized field are difficult to ascertain without competitive data.
Small Business Impact
The contract does not indicate any specific set-asides for small businesses, suggesting that the primary contractor, Textron Systems Corp, will likely handle the majority of the work, potentially with its own supply chain.
Oversight & Accountability
The long duration of the contract necessitates robust oversight from the Department of the Navy to ensure milestones are met and costs remain controlled. Transparency in progress reporting will be key.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for cost escalation over the contract duration.
- Limited visibility into the full cost structure due to sole-source nature.
- Dependency on a single supplier for critical components.
- Risk of schedule delays impacting overall naval readiness.
Tags
ship-building-and-repairing, department-of-defense, la, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $1.44 billion to TEXTRON SYSTEMS CORP. THREE FUTURE LCAC 100 CLASS CRAFT LONG LEAD TIME MATERIAL
Who is the contractor on this award?
The obligated recipient is TEXTRON SYSTEMS CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $1.44 billion.
What is the period of performance?
Start: 2023-08-04. End: 2031-10-13.
What is the justification for the sole-source award, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. The Department of Defense should have conducted a price analysis, comparing the proposed price to historical data, other government contracts, or commercial pricing if available, to ensure the price is fair and reasonable despite the lack of competition.
What are the specific risks associated with the long lead time and the fixed-price incentive contract type?
The primary risk with long lead times is the potential for unforeseen cost increases due to inflation, material shortages, or design changes over the contract's extended period. A Fixed Price Incentive (FPI) contract shares cost risks; if costs exceed targets, both the contractor and the government bear a portion, but it can incentivize cost control. However, poorly defined targets or incentives can still lead to cost overruns.
How will the performance and effectiveness of the LCAC 100 craft be measured throughout this long-term material acquisition phase?
Performance and effectiveness are typically measured through adherence to technical specifications, quality control during manufacturing, and timely delivery of the long lead time materials. Key performance indicators (KPIs) related to material quality, production schedules, and defect rates should be established and monitored. Final craft effectiveness will be assessed upon completion and testing of the full systems.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0002423R2452
Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 19401 CHEF MENTEUR HWY, NEW ORLEANS, LA, 70129
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: $1,436,316,386
Exercised Options: $1,436,316,386
Current Obligation: $1,436,316,386
Subaward Activity
Number of Subawards: 115
Total Subaward Amount: $247,495,118
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2023-08-04
Current End Date: 2031-10-13
Potential End Date: 2031-10-13 00:00:00
Last Modified: 2025-12-22
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