DoD Awards Northrop Grumman $213M Contract for UK Successor Support, Lacking Competition
Contract Overview
Contract Amount: $212,787,459 ($212.8M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2015-11-10
End Date: 2025-12-30
Contract Duration: 3,703 days
Daily Burn Rate: $57.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: IGF::OT::IGF UK SUCCESSOR SUPPORT
Place of Performance
Location: SUNNYVALE, SANTA CLARA County, CALIFORNIA, 94086
Plain-Language Summary
Department of Defense obligated $212.8 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: IGF::OT::IGF UK SUCCESSOR SUPPORT Key points: 1. Significant contract value of $213M for engineering services. 2. Sole-source award to Northrop Grumman raises competition concerns. 3. Long contract duration (2015-2025) suggests ongoing need but also potential for price creep. 4. Engineering services sector is critical for defense but often complex to benchmark.
Value Assessment
Rating: questionable
The contract type is Cost Plus Incentive Fee, which can lead to cost overruns if not managed tightly. Benchmarking is difficult without specific performance data and comparison to similar sole-source contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition for a contract of this magnitude means taxpayers may not be receiving the best possible value, as prices were not driven down by market forces.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The long-term nature of the contract could indicate critical but potentially inefficiently procured services. Lack of transparency in pricing due to sole-source award.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Long contract duration
- Lack of small business participation
Positive Signals
- Critical defense support services
- Established contractor with relevant experience
Sector Analysis
This contract falls within the Engineering Services sector, which is vital for defense readiness and complex system development. Spending in this sector can vary widely based on project scope and technological requirements.
Small Business Impact
The data indicates no small business participation in this contract. This is a missed opportunity to support small businesses and could indicate a lack of focus on subcontracting opportunities.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and effective service delivery. The long duration necessitates continuous monitoring of performance and costs.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency in pricing
- No small business participation
- Long contract duration may indicate inefficiencies
Tags
engineering-services, department-of-defense, ca, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $212.8 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. IGF::OT::IGF UK SUCCESSOR SUPPORT
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $212.8 million.
What is the period of performance?
Start: 2015-11-10. End: 2025-12-30.
What specific justification was provided for the sole-source award, and how does it align with federal procurement regulations for non-competitive contracts?
The justification for a sole-source award typically involves demonstrating that only one responsible source can provide the required supplies or services. This often relates to unique capabilities, proprietary technology, or urgent needs where competition is not feasible. Federal regulations like the FAR (Federal Acquisition Regulation) outline specific criteria and approval processes for sole-source procurements to ensure they are used judiciously and in the government's best interest.
How does the cost-plus incentive fee structure compare to industry benchmarks for similar engineering support services, particularly in sole-source scenarios?
Cost-plus incentive fee (CPIF) contracts aim to incentivize contractor performance by linking profit to achieving specific cost, schedule, or performance targets. Benchmarking CPIF contracts is challenging due to the variable nature of costs and incentives. However, in sole-source situations, the government must ensure the target cost and incentive structure are realistic and do not unduly inflate prices compared to what might be achieved through competition or other contract types.
What are the key performance indicators (KPIs) for this contract, and how is Northrop Grumman's performance being measured against them?
Key performance indicators for engineering services contracts typically include technical performance, schedule adherence, cost control, and quality of deliverables. For this specific contract, KPIs would likely be tailored to the UK Successor Support program's unique requirements. The government's contracting officer and technical representatives are responsible for monitoring these KPIs and ensuring Northrop Grumman meets or exceeds the agreed-upon standards throughout the contract's duration.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0003016Q0015
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 401 E HENDY AVE MS 33-3, SUNNYVALE, CA, 94086
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: $212,787,504
Exercised Options: $212,787,459
Current Obligation: $212,787,459
Actual Outlays: $6,654,140
Subaward Activity
Number of Subawards: 2130
Total Subaward Amount: $523,270,111
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2015-11-10
Current End Date: 2025-12-30
Potential End Date: 2025-12-30 00:00:00
Last Modified: 2025-09-23
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