Navy awards $24.7M for MK-59 Decoy Systems, a sole-source procurement

Contract Overview

Contract Amount: $24,764,102 ($24.8M)

Contractor: Irvingq Limited

Awarding Agency: Department of Defense

Start Date: 2025-12-08

End Date: 2027-08-30

Contract Duration: 630 days

Daily Burn Rate: $39.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MK-59 DECOY AND LAUNCHER SYSTEM AND END CAPS

Plain-Language Summary

Department of Defense obligated $24.8 million to IRVINGQ LIMITED for work described as: MK-59 DECOY AND LAUNCHER SYSTEM AND END CAPS Key points: 1. The contract value represents a significant investment in naval defense capabilities. 2. Sole-source procurement raises questions about potential price inflation and limited market engagement. 3. The duration of the contract suggests a sustained need for these specialized decoy systems. 4. Performance is tied to a firm fixed-price structure, offering some cost predictability. 5. The acquisition falls within the specialized manufacturing of guidance and navigation systems.

Value Assessment

Rating: questionable

Benchmarking the value of this sole-source contract is challenging without competitive data. The $24.7 million award for MK-59 Decoy Systems and end caps, with a duration of 630 days, appears substantial. Without comparable contract awards or market analysis, it's difficult to definitively assess if the pricing is optimal or if taxpayers are receiving excellent value for money. The lack of competition inherently limits the ability to compare pricing against market alternatives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This approach is typically used when a unique capability or proprietary technology is required, or in cases of urgent need where competition is not feasible. The limited competition means there was no opportunity for multiple bidders to offer proposals, which can hinder price discovery and potentially lead to higher costs compared to a fully competed procurement.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings typically achieved through competitive bidding processes, potentially leading to a higher overall expenditure for these decoy systems.

Public Impact

The primary beneficiaries are the U.S. Navy warfighters who will utilize the MK-59 Decoy and Launcher Systems. The contract delivers essential defensive countermeasures to protect naval assets. The geographic impact is primarily within naval operations theaters globally. Workforce implications are likely concentrated within the specialized manufacturing sector supporting defense systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential cost savings.
Lack of transparency in the justification for sole-sourcing.
Potential for vendor lock-in due to specialized nature of the system.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Contract duration indicates a stable, long-term need for the system.
Award supports a critical defense capability for naval operations.

Sector Analysis

The defense sector, specifically the manufacturing of guidance, navigation, and control systems, is characterized by high technological barriers to entry and specialized production capabilities. The market for naval decoy systems is niche, often dominated by a few key suppliers due to the critical nature and proprietary aspects of the technology. This contract fits within the broader defense procurement landscape, where specialized systems are essential for maintaining military superiority. Comparable spending in this sub-sector can vary widely based on system complexity and quantity, but significant investments are common for advanced defense technologies.

Small Business Impact

This contract was not competed and there is no indication of small business set-asides or subcontracting plans. As a sole-source award to a likely established defense contractor, the direct impact on the small business ecosystem is minimal. There is no explicit mechanism in this award to ensure small business participation, which could be a missed opportunity for fostering innovation and competition within the defense supply chain.

Oversight & Accountability

Oversight for this contract will likely fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the firm fixed-price structure, which caps the government's liability. Transparency is limited due to the sole-source nature of the award, with justifications for this procurement method typically reviewed internally. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Warfare Systems
Defense Procurement
Countermeasure Systems
Aeronautical and Nautical System Manufacturing

Risk Flags

Sole-source procurement
Limited competition
Potential for price inflation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.8 million to IRVINGQ LIMITED. MK-59 DECOY AND LAUNCHER SYSTEM AND END CAPS

Who is the contractor on this award?

The obligated recipient is IRVINGQ LIMITED.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $24.8 million.

What is the period of performance?

Start: 2025-12-08. End: 2027-08-30.

What is the historical spending pattern for MK-59 Decoy and Launcher Systems by the Department of the Navy?

Analyzing historical spending for the MK-59 Decoy and Launcher System requires access to detailed contract databases and procurement history. Without specific prior contract numbers or award dates, a precise historical spending figure is difficult to ascertain. However, the current award of $24.7 million for a period extending to August 2027 suggests a sustained and significant investment in this capability. Typically, such systems are procured incrementally over several years, with spending fluctuating based on production schedules, modernization efforts, and operational tempo. A comprehensive review would involve examining all previous awards for this specific system, including any modifications or sustainment contracts, to understand the total lifecycle cost and identify trends in procurement volume and pricing over time.

What specific justification was provided for awarding this contract on a sole-source basis?

The justification for a sole-source award is typically rooted in specific criteria outlined in federal acquisition regulations, such as the uniqueness of the technology, the unavailability of comparable commercial items, or urgent and compelling needs that preclude full and open competition. For the MK-59 Decoy and Launcher System, the justification likely centers on the specialized nature of the technology, potentially involving proprietary designs or unique manufacturing processes developed by Irvingq Limited. The Department of the Navy would have had to demonstrate that no other responsible source could meet the government's requirements in a timely manner. This often involves extensive market research to confirm the lack of viable alternatives. Without the official justification document (e.g., a Justification and Approval - J&A), the precise reasons remain speculative but are expected to align with regulatory exceptions to full competition.

How does the per-unit cost of the MK-59 Decoy System compare to similar decoy systems used by other military branches or allied nations?

Comparing the per-unit cost of the MK-59 Decoy System is challenging without detailed cost breakdowns and specific unit quantities within the $24.7 million award. Furthermore, direct comparisons to systems used by other military branches or allied nations are complicated by differences in system capabilities, technological sophistication, production volumes, and contracting methodologies. Decoy systems can range significantly in complexity and price, from basic expendable decoys to advanced active decoys with sophisticated electronic warfare capabilities. To perform a meaningful benchmark, one would need to identify functionally equivalent systems, obtain their unit costs (often difficult due to proprietary information and varying contract terms), and adjust for differences in features and performance. Given the sole-source nature of this award, external benchmarking data is even more critical but likely scarce.

What are the potential risks associated with a sole-source contract for critical defense components like the MK-59 Decoy System?

Sole-source contracts for critical defense components like the MK-59 Decoy System present several potential risks. Firstly, the lack of competition can lead to higher prices than might be achieved through a competitive bidding process, as the contractor faces less pressure to offer the most cost-effective solution. Secondly, it can foster vendor lock-in, making it difficult and costly to switch suppliers in the future, even if better alternatives emerge. Thirdly, without competitive pressure, there might be reduced incentives for the sole-source provider to innovate or improve efficiency. Finally, there's a risk of supply chain disruptions if the sole provider experiences financial difficulties or production issues, as there are no readily available alternative sources. These risks underscore the importance of rigorous justification and oversight for sole-source procurements.

What is the expected performance and reliability of the MK-59 Decoy System based on its intended use?

The MK-59 Decoy and Launcher System is designed to provide countermeasures against various threats, likely including radar-guided missiles and other weapon systems targeting naval vessels. Its intended use implies a requirement for high reliability and effectiveness in demanding operational environments. While specific performance metrics and reliability data (such as Mean Time Between Failures - MTBF) are typically considered sensitive operational information, the system's procurement by the Department of the Navy suggests it has met stringent performance requirements during testing and evaluation phases. The firm fixed-price contract structure implies that the contractor is obligated to deliver a system that meets defined performance specifications. Failures to meet these specifications could result in contract penalties or rejection of the delivered goods.

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: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0002425R5524

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: BETTWS ROAD, BRIDGEND

Business Categories: Category Business, Corporate Entity Tax Exempt, Foreign Owned, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $24,764,102

Exercised Options: $24,764,102

Current Obligation: $24,764,102

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline