DoD Awards Raytheon $45M for SSSA MOD KITS, Sole-Source Contract Raises Cost Concerns
Contract Overview
Contract Amount: $44,974,384 ($45.0M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2025-09-30
End Date: 2029-08-31
Contract Duration: 1,431 days
Daily Burn Rate: $31.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: SSSA MOD KITS
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $45.0 million to RAYTHEON COMPANY for work described as: SSSA MOD KITS Key points: 1. Significant award value of $44.97M for specialized kits. 2. Sole-source award to Raytheon Company limits competitive pricing. 3. Long contract duration (2025-2029) may impact long-term value. 4. Focus on Search, Detection, Navigation systems highlights critical defense capabilities.
Value Assessment
Rating: questionable
The contract's value is substantial, but without competition, it's difficult to assess if the price is optimal. Benchmarking against similar sole-source procurements for specialized defense systems would be necessary.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Raytheon Company. This lack of competition limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The absence of competition in this sole-source award means taxpayers may be paying a premium for these SSSA MOD KITS.
Public Impact
Ensures continued operational capability for critical Navy search and detection systems. Supports advanced technology development within the defense sector. Potential for cost overruns due to sole-source nature impacts taxpayer funds. Long-term sustainment of naval assets relies on such specialized equipment.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of transparency in pricing
Positive Signals
- Critical defense system procurement
- Award to established defense contractor
Sector Analysis
This procurement falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector. Spending in this area is crucial for national security, but often involves high-value, specialized contracts that can be prone to sole-source awards.
Small Business Impact
There is no indication of small business participation in this specific contract award. Further analysis would be needed to determine if subcontracting opportunities exist for small businesses.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential cost creep. Regular performance reviews and cost audits are essential for accountability.
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 limits competition and price discovery.
- Long contract duration may lead to price increases over time.
- Lack of transparency regarding specific cost breakdowns.
- Potential for vendor lock-in with specialized technology.
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 $45.0 million to RAYTHEON COMPANY. SSSA MOD 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 $45.0 million.
What is the period of performance?
Start: 2025-09-30. End: 2029-08-31.
What is the justification for the sole-source award, and what steps were taken to ensure the best possible price was negotiated?
The justification for a sole-source award typically involves unique capabilities or proprietary technology held by a single vendor. However, even in sole-source situations, the government should conduct thorough market research and negotiate aggressively to secure the most favorable terms and pricing. Without this information, it's difficult to assess the value.
How does the unit cost of these SSSA MOD KITS compare to similar systems procured competitively?
Direct comparison is challenging without specific unit cost data and details on the system's capabilities. However, the absence of competition inherently raises concerns about potential price inflation. Benchmarking against publicly available data for comparable defense electronics, adjusted for complexity and features, would be the next step in assessing value.
What is the long-term strategy for maintaining and upgrading these systems, and does this contract facilitate or hinder that strategy?
The long contract duration suggests a focus on long-term sustainment. However, a sole-source award might limit future flexibility in adopting newer technologies or seeking more cost-effective upgrade paths if the contractor's offerings become outdated or excessively expensive over time. This could impact the overall effectiveness and cost-efficiency of the naval systems.
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: N0002425R5362
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp
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: $44,974,384
Exercised Options: $44,974,384
Current Obligation: $44,974,384
Subaward Activity
Number of Subawards: 5
Total Subaward Amount: $2,697,534
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: 2025-09-30
Current End Date: 2029-08-31
Potential End Date: 2029-08-31 00:00:00
Last Modified: 2025-12-09
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