DoD Awards Raytheon $218M for Encanistered Missile Propulsion Units Amidst Limited Competition
Contract Overview
Contract Amount: $218,267,278 ($218.3M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2022-12-22
End Date: 2028-09-30
Contract Duration: 2,109 days
Daily Burn Rate: $103.5K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: ENCANISTERED MISSILE
Place of Performance
Location: TUCSON, PIMA County, ARIZONA, 85756
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $218.3 million to RAYTHEON COMPANY for work described as: ENCANISTERED MISSILE Key points: 1. Significant contract value of $218.27 million awarded to Raytheon Company. 2. Limited competition raises questions about price discovery and potential overspending. 3. Contract duration of 2109 days (approx. 5.7 years) indicates a long-term need. 4. Focus on propulsion units suggests a critical component for missile systems.
Value Assessment
Rating: questionable
The contract's firm fixed price structure with limited competition makes it difficult to assess value without benchmarks. The lack of available pricing data for comparison hinders a definitive valuation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not available for competition, suggesting a sole-source or limited source award. This lack of robust competition may lead to higher prices than if multiple vendors were involved in the bidding process.
Taxpayer Impact: The limited competition raises concerns about taxpayer dollars being used efficiently, as the government may not be securing the best possible price.
Public Impact
Missile propulsion systems are vital for national defense capabilities. Long-term contracts can ensure supply chain stability for critical defense components. Lack of transparency in pricing for defense contracts can erode public trust.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Lack of pricing data
- Long contract duration
Positive Signals
- Firm fixed price contract
- Critical defense component
Sector Analysis
This contract falls within the defense sector, specifically focusing on missile propulsion systems. Spending in this area is critical for maintaining national security, but often involves complex supply chains and specialized manufacturing.
Small Business Impact
There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. Further analysis would be needed to determine potential opportunities for small business participation.
Oversight & Accountability
The contract is awarded by the Department of the Navy, a branch of the Department of Defense. Oversight would typically involve program management offices and contracting officers to ensure performance and compliance.
Related Government Programs
- Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Limited competition
- Lack of pricing data
- Potential for higher costs
- Long contract duration
Tags
guided-missile-and-space-vehicle-propuls, department-of-defense, az, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $218.3 million to RAYTHEON COMPANY. ENCANISTERED MISSILE
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 $218.3 million.
What is the period of performance?
Start: 2022-12-22. End: 2028-09-30.
What specific factors led to the limited competition for these missile propulsion units, and were alternative sourcing strategies explored?
The limited competition likely stems from the highly specialized nature of guided missile propulsion systems, requiring unique technical expertise and manufacturing capabilities. Alternative sourcing strategies may have been explored, but the data suggests that only Raytheon met the stringent requirements or was the sole qualified bidder at the time of award.
How does the firm fixed price impact the government's ability to mitigate cost overruns given the limited competition?
A firm fixed price contract shifts most of the cost risk to the contractor. However, with limited competition, the initial price might be higher than in a competitive scenario. The government's ability to mitigate overruns is primarily dependent on the initial negotiation and the contractor's efficiency, rather than post-award adjustments.
What is the strategic importance of these specific propulsion units, and how does this contract ensure their availability for future defense needs?
These propulsion units are critical components for guided missiles, directly impacting the effectiveness and range of naval weapon systems. This long-term contract ensures a consistent supply of these specialized parts, supporting ongoing military readiness and the development of next-generation missile technologies.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0002421R5432
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
Address: 1151 E HERMANS RD, TUCSON, AZ, 85756
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: $230,003,490
Exercised Options: $221,603,079
Current Obligation: $218,267,278
Subaward Activity
Number of Subawards: 32
Total Subaward Amount: $7,445,976
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2022-12-22
Current End Date: 2028-09-30
Potential End Date: 2028-09-30 00:00:00
Last Modified: 2025-09-30
More Contracts from Raytheon Company
- Federal Contract — $5.7B (Department of Defense)
- TEN Fire Units for Qatar — $5.6B (Department of Defense)
- GPS Advanced Control Segment (OCX) Phase B Blocks 1 and 2 — $4.5B (Department of Defense)
- An/Spy-6(v) Hardware Production — $3.3B (Department of Defense)
- Predominant - Patriot UAE — $3.0B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)