Navy awards $14.87M for sonobuoys, with 2 bids received, indicating moderate competition

Contract Overview

Contract Amount: $14,867,709 ($14.9M)

Contractor: Undersea Sensor Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-01-30

End Date: 2010-04-03

Contract Duration: 794 days

Daily Burn Rate: $18.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: AN/SSQ-53F SONOBUOY

Place of Performance

Location: COLUMBIA CITY, WHITLEY County, INDIANA, 46725

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $14.9 million to UNDERSEA SENSOR SYSTEMS, INC. for work described as: AN/SSQ-53F SONOBUOY Key points: 1. Value for money appears reasonable given the specialized nature of sonobuoys. 2. Competition dynamics suggest a moderately contested market for this specific defense technology. 3. Risk indicators are low, with a firm fixed-price contract mitigating cost overruns. 4. Performance context is tied to undersea warfare capabilities, a critical defense function. 5. Sector positioning places this contract within the specialized defense electronics manufacturing industry.

Value Assessment

Rating: good

The contract value of approximately $14.87 million for AN/SSQ-53F sonobuoys seems aligned with specialized defense procurement. Benchmarking against similar advanced sensor systems suggests this is a fair price, especially considering the limited number of manufacturers capable of producing such technology. The firm fixed-price structure further supports value by transferring cost risk to the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with two bids received. While two bidders indicate some level of competition, it is not robust. This suggests that the market for this specific type of sonobuoy may be concentrated among a few specialized firms, potentially limiting price discovery compared to a more crowded field.

Taxpayer Impact: Taxpayers benefit from a competitive process, even if limited, which helps ensure a more reasonable price than a sole-source award. The presence of multiple bidders provides some assurance against excessive pricing.

Public Impact

The primary beneficiaries are the U.S. Navy's undersea warfare operations, enhancing their anti-submarine warfare (ASW) capabilities. The contract delivers essential AN/SSQ-53F sonobuoys, which are critical components for detecting and tracking submarines. Geographic impact is national, supporting naval readiness across various operational theaters. Workforce implications include supporting skilled manufacturing jobs in the defense sector, likely in Indiana where the contractor is based.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited future competition if the market remains concentrated.
Dependence on a small number of specialized suppliers for critical defense components.

Positive Signals

Awarded under full and open competition, allowing any qualified vendor to bid.
Firm fixed-price contract structure limits cost uncertainty for the government.
Contractor is based in Indiana, potentially supporting regional economic activity.

Sector Analysis

This contract falls within the defense electronics manufacturing sector, specifically focusing on undersea warfare sensors. The market for advanced sonobuoys is characterized by high technological barriers to entry and stringent quality requirements. Comparable spending benchmarks would typically be found within broader naval procurement data for electronic warfare and sensor systems, where unit costs can range significantly based on sophistication.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss: false'. The prime contractor, Undersea Sensor Systems, Inc., is likely a mid-to-large-sized business. There is no explicit information on subcontracting plans for small businesses, but given the specialized nature of the product, it's possible that some components or services might be sourced from smaller, specialized suppliers within the defense industrial base.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy's contracting and program management offices. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified sonobuoys. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Sonar Systems
Undersea Warfare Equipment
Defense Electronics Manufacturing
Anti-Submarine Warfare (ASW) Systems
Naval Aviation Support Equipment

Risk Flags

Limited competition may lead to higher prices over time.
Dependence on a single source for critical components can pose supply chain risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.9 million to UNDERSEA SENSOR SYSTEMS, INC.. AN/SSQ-53F SONOBUOY

Who is the contractor on this award?

The obligated recipient is UNDERSEA SENSOR SYSTEMS, 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 $14.9 million.

What is the period of performance?

Start: 2008-01-30. End: 2010-04-03.

What is the historical spending trend for AN/SSQ-53F sonobuoys or similar systems by the Department of the Navy?

Historical spending data for the AN/SSQ-53F sonobuoy specifically is limited in publicly accessible databases beyond this single award. However, broader trends in naval sonar and undersea warfare systems show consistent investment. The Navy allocates significant portions of its budget to maintaining and modernizing its ASW capabilities, which include various types of sonobuoys and related acoustic sensors. Spending in this category often fluctuates based on technological advancements, fleet modernization programs, and perceived threats. For instance, increased focus on submarine threats could lead to higher procurement volumes or investment in next-generation systems. Without more specific contract history for this exact model, it's difficult to establish a precise trend, but the overall category remains a priority.

How does the unit cost of the AN/SSQ-53F compare to other sonobuoy variants or competitor products?

Direct unit cost comparison for the AN/SSQ-53F is challenging without access to detailed pricing breakdowns or data on other specific sonobuoy models procured by the Navy. The AN/SSQ-53F is a specific variant, likely with unique performance characteristics and manufacturing costs. Generally, sonobuoys vary in complexity, ranging from simpler acoustic receivers to more advanced systems with enhanced processing capabilities. The reported contract value of approximately $14.87 million for an unspecified quantity suggests a unit price that reflects advanced technology. Competitor products or earlier/later variants might have different price points based on their technological sophistication, production volume, and the competitive landscape at the time of their procurement. The limited competition for this specific award suggests a potentially higher unit cost than if it were a widely produced, commoditized item.

What is the track record of Undersea Sensor Systems, Inc. in delivering defense contracts, particularly for the Navy?

Undersea Sensor Systems, Inc. has a history of performing defense contracts, primarily within the realm of sensor technology. While specific details on their entire contract portfolio require deeper database access, their involvement in producing sonobuoys for the Navy indicates a level of established capability and trust. Companies operating in this niche defense sector typically undergo rigorous vetting and must demonstrate consistent quality and reliability. Their ability to win this contract, even with limited competition, suggests they meet the Navy's technical and performance requirements. Further analysis would involve examining past performance reviews, on-time delivery rates, and any history of contract disputes or quality issues associated with the company's previous awards.

What are the key performance requirements and technological advancements associated with the AN/SSQ-53F sonobuoy?

The AN/SSQ-53F sonobuoy is a critical component in the Navy's anti-submarine warfare (ASW) arsenal, designed for detecting and classifying underwater acoustic signatures. Key performance requirements typically include high sensitivity, directional accuracy, extended operational life, and robust performance in diverse oceanographic conditions. Technological advancements in this series likely focus on improved signal processing, enhanced countermeasures detection, reduced false alarm rates, and potentially miniaturization or increased power efficiency. As a passive acoustic sensor, its effectiveness relies on sophisticated internal electronics and hydrophones capable of distinguishing faint sounds from submarines amidst ambient ocean noise. The specific 'F' designation suggests it is a particular iteration or upgrade within the AN/SSQ-53 family, incorporating newer technologies or improved specifications over previous models.

How does the firm fixed-price contract type influence the risk and cost management for this sonobuoy procurement?

A firm fixed-price (FFP) contract type is generally advantageous for the government in managing cost certainty. Under an FFP agreement, the contractor assumes most of the risk for cost overruns. This means Undersea Sensor Systems, Inc. is obligated to deliver the specified sonobuoys for the agreed-upon price, regardless of their actual production costs. This structure incentivizes the contractor to manage their expenses efficiently and accurately estimate their costs upfront. For the Navy, it provides a clear ceiling on expenditure, simplifying budget planning and reducing the risk of unexpected cost increases. The primary risk for the government shifts from cost overruns to potential contractor underperformance or quality issues, which are typically addressed through contract clauses and performance monitoring.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0016408RGP01

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Undersea Sensor Systems Inc (UEI: 349084822)

Address: 4578 E PARK 30 DR, COLUMBIA CITY, IN, 03

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $20,497,109

Exercised Options: $16,750,259

Current Obligation: $14,867,709

Contract Characteristics

Cost or Pricing Data: NO

Timeline