DoD Awards Raytheon $38.9M for Navigation Systems, Sole-Source Contract Raises Concerns
Contract Overview
Contract Amount: $38,902,047 ($38.9M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2024-03-08
End Date: 2027-07-27
Contract Duration: 1,236 days
Daily Burn Rate: $31.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: JAPAN ASEV EQUIPMENT AND USN DMS LAST CHANCE BUY
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $38.9 million to RAYTHEON COMPANY for work described as: JAPAN ASEV EQUIPMENT AND USN DMS LAST CHANCE BUY Key points: 1. Significant award value of $38.9 million for critical navigation equipment. 2. Sole-source award to Raytheon Company limits competitive pricing. 3. Potential risk associated with limited competition and lack of price discovery. 4. Spending falls within the broad 'Search, Detection, Navigation...' manufacturing sector.
Value Assessment
Rating: questionable
The contract's value of $38.9 million is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to similar systems from other manufacturers.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This method bypasses the competitive process, potentially leading to higher prices and reduced innovation as there is no market pressure.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for this equipment.
Public Impact
Naval operations rely on advanced navigation systems for safety and effectiveness. This award impacts a key defense contractor, Raytheon Technologies. Long-term contract duration (2024-2027) suggests ongoing need for these systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement
- Lack of competition
- Potential for overpricing
Positive Signals
- Award to established defense contractor
- Supports critical navigation systems
Sector Analysis
This award falls under the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector. Spending in this area is crucial for national defense and maritime safety, but often involves specialized, high-cost components.
Small Business Impact
The data does not indicate any subcontracting opportunities for small businesses. The prime contractor, Raytheon, is a large corporation, and the sole-source nature of this award further limits potential for small business involvement.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure the Department of Defense obtained the best possible value. Further review of the justification for sole-source procurement is recommended.
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
- Sole-source award
- Lack of competitive bidding
- Potential for inflated pricing
- Limited transparency on justification
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 $38.9 million to RAYTHEON COMPANY. JAPAN ASEV EQUIPMENT AND USN DMS LAST CHANCE BUY
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 $38.9 million.
What is the period of performance?
Start: 2024-03-08. End: 2027-07-27.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or a lack of viable alternatives. Without this information, it's impossible to fully assess if this procurement method was truly necessary or if competitive options were overlooked. This lack of transparency hinders a complete value assessment.
How does the unit cost compare to similar navigation systems procured competitively?
Without access to pricing data from competitive procurements of similar navigation systems, a direct comparison is not possible. The sole-source nature of this contract prevents a clear benchmark against market rates. Further analysis would require identifying comparable systems and their contract values.
What is the potential impact on future defense spending if sole-source awards become common for this type of equipment?
If sole-source awards become prevalent for navigation systems, it could lead to escalating costs for the Department of Defense due to the absence of competitive pressure. This might also stifle innovation as contractors have less incentive to improve products or reduce prices. Ultimately, taxpayers could bear a higher financial burden.
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: N0002424R5342
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: $38,902,047
Exercised Options: $38,902,047
Current Obligation: $38,902,047
Subaward Activity
Number of Subawards: 58
Total Subaward Amount: $11,771,108
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0002422G5311
IDV Type: BOA
Timeline
Start Date: 2024-03-08
Current End Date: 2027-07-27
Potential End Date: 2027-07-27 00:00:00
Last Modified: 2025-06-25
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