DoD's $75.9M T-1687 Transmitter Countermeasure Contract Awarded to BAE Systems

Contract Overview

Contract Amount: $75,905,989 ($75.9M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2017-11-22

End Date: 2020-03-30

Contract Duration: 859 days

Daily Burn Rate: $88.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: T-1687 TRANSMITTER COUNTERMEASURE

Place of Performance

Location: NASHUA, HILLSBOROUGH County, NEW HAMPSHIRE, 03060

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $75.9 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: T-1687 TRANSMITTER COUNTERMEASURE Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. The contract duration of 859 days suggests a significant operational need. 3. The fixed-price contract type shifts performance risk to the contractor. 4. The specific product, T-1687 Transmitter Countermeasure, indicates a specialized defense application. 5. The award to a large, established defense contractor like BAE Systems is typical for complex systems.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and the specialized 'T-1687 Transmitter Countermeasure' designation, which lacks readily available public comparisons. The total award amount of $75.9 million over approximately 2.4 years suggests a substantial investment. Without competitive bids or more detailed cost breakdowns, it's difficult to definitively assess if the pricing represents fair market value or if taxpayers received optimal value for money. The lack of competition inherently raises concerns about potential overpricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning it was not competed among multiple vendors. This approach is typically reserved for situations where only one vendor possesses the necessary capabilities, technology, or proprietary rights to fulfill the requirement. The absence of a competitive bidding process means that the government did not benefit from the price discovery and potential cost savings that typically arise from multiple offers.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no market pressure to drive down prices. This limits the government's ability to secure the best possible deal.

Public Impact

The primary beneficiaries are likely elements within the Department of the Navy requiring advanced electronic warfare capabilities. The contract delivers specialized countermeasure technology crucial for protecting naval assets. The geographic impact is primarily tied to the contractor's facilities in New Hampshire and the operational deployment locations of the Navy. Workforce implications include specialized engineering, manufacturing, and technical support roles within BAE Systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs.
Lack of transparency in pricing due to non-competitive nature.
Specialized nature of the product makes independent cost verification difficult.

Positive Signals

Award to a reputable defense contractor with a track record in electronic systems.
Fixed-price contract shifts some performance risk to the contractor.
Contract duration suggests a sustained need for the capability.

Sector Analysis

The defense electronics sector is characterized by high R&D investment, long product lifecycles, and significant government procurement. Contracts for specialized systems like transmitter countermeasures are critical for maintaining technological superiority. The market is dominated by a few large prime contractors, including BAE Systems, who possess the expertise and security clearances required. Spending in this sub-sector is driven by evolving threat landscapes and the need for advanced electronic warfare capabilities.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for small businesses based on the available data. The award to a large prime contractor suggests that the primary work will be performed in-house or through established supply chains, potentially limiting direct benefits to the small business ecosystem for this specific procurement.

Oversight & Accountability

Oversight for this contract would fall under the Department of the Navy's contracting and program management offices. Accountability measures are typically embedded within the contract terms, including performance standards and delivery schedules. Transparency is limited due to the sole-source nature of the award. The Inspector General for the Department of Defense may conduct audits or investigations if specific concerns regarding waste, fraud, or abuse arise.

Related Government Programs

Naval Electronic Warfare Systems
Electronic Countermeasures
Defense Communications Equipment
Military Aircraft Components

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for unbenchmarked pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $75.9 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. T-1687 TRANSMITTER COUNTERMEASURE

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $75.9 million.

What is the period of performance?

Start: 2017-11-22. End: 2020-03-30.

What is the specific function and operational importance of the T-1687 Transmitter Countermeasure?

The T-1687 Transmitter Countermeasure is a specialized electronic warfare system designed to detect, identify, and disrupt enemy radar and communication signals. Its primary function is to protect naval platforms, such as ships and aircraft, from hostile surveillance and targeting by employing jamming or deception techniques. The operational importance lies in enhancing survivability and mission effectiveness in contested electromagnetic environments. Without this technology, naval assets would be more vulnerable to detection and attack, potentially compromising mission success and personnel safety. The specific details of its capabilities are classified due to the sensitive nature of electronic warfare.

How does the $75.9 million award compare to historical spending on similar countermeasure systems by the Department of the Navy?

Comparing the $75.9 million award for the T-1687 Transmitter Countermeasure to historical spending on similar systems is difficult without more specific product classifications and competitive data. However, the amount suggests a significant investment in a critical capability. The Department of the Navy consistently spends billions annually on electronic warfare systems, encompassing a wide range of technologies from basic jammers to sophisticated integrated suites. This particular contract, awarded over approximately 2.4 years, represents a substantial portion of funding for a specific, likely advanced, countermeasure. Without knowing the exact technological generation or scope of the T-1687, direct historical comparisons are speculative, but it falls within the typical range for major defense procurement of specialized electronic systems.

What are the primary risks associated with a sole-source contract for advanced defense technology?

The primary risks associated with a sole-source contract for advanced defense technology include inflated pricing due to a lack of competition, potential for reduced innovation as the contractor faces less market pressure, and a diminished ability for the government to negotiate favorable terms. There's also a risk of vendor lock-in, where the government becomes overly reliant on a single supplier, making future transitions or upgrades more complex and costly. Furthermore, without competitive benchmarking, it's harder to ensure the technology meets the evolving needs of the warfighter at a reasonable cost. This can lead to taxpayers funding systems that are either overpriced or not as effective as they could be if developed or sourced through a competitive process.

What is BAE Systems' track record in delivering electronic warfare systems to the U.S. military?

BAE Systems has a long and extensive track record of delivering a wide array of electronic warfare (EW) systems and capabilities to the U.S. military across all branches. They are a major global defense contractor with significant expertise in areas such as radar, electronic support measures, electronic countermeasures, and communications intelligence. The company has been involved in numerous large-scale defense programs, including the development and sustainment of EW suites for fighter jets, naval vessels, and ground vehicles. Their history includes both successful large-program execution and, like many large contractors, occasional challenges related to cost, schedule, or performance on complex, technologically advanced projects. However, their overall presence and continued awards in the EW domain indicate a strong standing and perceived capability by the Department of Defense.

How does the fixed-price contract type impact the government's exposure to cost overruns for this transmitter countermeasure system?

The firm-fixed-price (FFP) contract type generally offers the government the best protection against cost overruns. Under an FFP agreement, the contractor, BAE Systems in this case, is obligated to complete the work for a predetermined price, regardless of their actual costs. This means that if the contractor's expenses exceed their estimates, the additional costs are absorbed by BAE Systems, not the government. This structure incentivizes the contractor to manage their costs efficiently and perform the work within budget. However, it's important to note that the initial price negotiated in an FFP contract is critical. If the baseline price was set too high, the government might still overpay, even though they are protected from cost overruns beyond that negotiated price. The risk for the government shifts more towards performance and schedule adherence rather than direct cost escalation.

Industry Classification

NAICS: Manufacturing › Other Chemical Product and Preparation Manufacturing › All Other Miscellaneous Chemical Product and Preparation Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC

Address: 65 SPIT BROOK RD, NASHUA, NH, 03060

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $75,905,989

Exercised Options: $75,905,989

Current Obligation: $75,905,989

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0010416G0726

IDV Type: BOA

Timeline