DoD's $33.9M contract for AN/ALQ-218/240 repairs awarded to Northrop Grumman without competition
Contract Overview
Contract Amount: $33,893,356 ($33.9M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2020-12-02
End Date: 2025-12-03
Contract Duration: 1,827 days
Daily Burn Rate: $18.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: AN/ALQ-218 AND AN/ALQ-240 ENGINEERING SERVICES AND REPAIRS
Place of Performance
Location: LINTHICUM HEIGHTS, ANNE ARUNDEL County, MARYLAND, 21090
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $33.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: AN/ALQ-218 AND AN/ALQ-240 ENGINEERING SERVICES AND REPAIRS Key points: 1. The contract focuses on specialized electronic warfare system engineering services and repairs. 2. Northrop Grumman is the sole awardee, raising questions about competitive pricing. 3. The risk lies in potential overpricing due to the lack of competition. 4. This falls under the Defense sector, specifically electronic warfare systems.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can lead to higher costs if not closely managed. Benchmarking against similar sole-source contracts for specialized defense electronics is difficult without more data, but the lack of competition inherently limits price discovery.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This method bypasses competitive bidding, potentially leading to higher prices and reduced value for taxpayers as there is no market pressure to offer the lowest cost.
Taxpayer Impact: The lack of competition for this significant contract raises concerns about whether taxpayers are receiving the best possible value for the funds expended.
Public Impact
Military readiness may be impacted if these critical electronic warfare systems are not maintained efficiently. Taxpayers may be overpaying for engineering services and repairs due to the absence of competitive bidding. The long-term implications for defense spending on sole-source contracts warrant scrutiny.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Essential system support
- Long-term contract duration
Sector Analysis
This contract is within the Defense sector, specifically for electronic warfare systems. Spending on specialized engineering services and repairs for such systems can be substantial, and competitive bidding is crucial to ensure cost-effectiveness.
Small Business Impact
This contract was awarded to Northrop Grumman, a large prime contractor. There is no indication that small businesses were involved as subcontractors or partners in this specific award, which is common for large, specialized defense contracts.
Oversight & Accountability
The sole-source nature of this award suggests limited oversight on price competition. Further review by the agency or oversight bodies would be needed to ensure the fixed fee and cost reimbursement are reasonable and justified.
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 price competition.
- Cost-plus contract type can incentivize higher spending.
- Lack of transparency in pricing justification.
- Potential for inflated fixed fee.
- Limited opportunity for small business participation.
Tags
search-detection-navigation-guidance-aer, department-of-defense, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $33.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. AN/ALQ-218 AND AN/ALQ-240 ENGINEERING SERVICES AND REPAIRS
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 $33.9 million.
What is the period of performance?
Start: 2020-12-02. End: 2025-12-03.
What is the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. For this contract, the Department of Defense would need to document why Northrop Grumman was the only viable option. To ensure fair and reasonable pricing, the agency would likely conduct a price analysis based on historical data, cost proposals, and potentially independent government cost estimates, despite the absence of direct competition.
What are the potential risks associated with a Cost Plus Fixed Fee contract for specialized engineering services, especially when awarded sole-source?
A Cost Plus Fixed Fee (CPFF) contract reimburses the contractor for allowable costs plus a fixed fee representing profit. When awarded sole-source, the risk is that the contractor may not be incentivized to control costs as rigorously as in a competitive environment, as the fixed fee is predetermined. The government bears the risk of cost overruns beyond the agreed-upon allowable costs, and the fixed fee might be inflated if not properly negotiated or benchmarked against similar sole-source agreements.
How does the lack of competition for this contract potentially impact the long-term effectiveness and cost of maintaining these electronic warfare systems?
The lack of competition can lead to higher unit costs for repairs and engineering services over the contract's duration, potentially diverting funds from other critical defense needs. It may also reduce the incentive for innovation and efficiency from the contractor, as there is no competitive pressure to improve processes or offer better value. This could result in less effective system maintenance or higher lifecycle costs for the AN/ALQ-218 and AN/ALQ-240 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: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0016420RWS42
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 1580B W NURSERY RD, LINTHICUM HEIGHTS, MD, 21090
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: $33,921,325
Exercised Options: $33,921,325
Current Obligation: $33,893,356
Subaward Activity
Number of Subawards: 30
Total Subaward Amount: $5,911,796
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0016421GWS42
IDV Type: BOA
Timeline
Start Date: 2020-12-02
Current End Date: 2025-12-03
Potential End Date: 2025-12-03 00:00:00
Last Modified: 2025-11-28
More Contracts from Northrop Grumman Systems Corporation
- 200506!000026!5700!fa8214!oo-Alc/Pkme/Lmke !F4261098C0001 !A!N! !Y! !p01502!20041213!20050701!001563738!004179453!016435559!n!northrop Grumman Space & Missi!888 S 2000 E !clearfield !ut!84015!13850!011!49!clearfield !davis !utah !-000001960000!n!n!000000000000!l014!tech REP Svcs/Guided Missiles !A2 !missile and Space Systems !302 !minuteman III GRP !541330!E! !3! ! !C! ! !20200930!B! ! !A! !a!n!l!2!002!b! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! — $10.0B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-7) — $8.5B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-2) — $5.4B (Department of Defense)
- First DDT and E, Ares I-X, and Flight Tests. First Stage Will BE a Five Segment, Solid Rocket Booster Derived From the Space Shuttle Program (SSP) Solid Rocket Booster (srb)/Reusable Solid Rocket Motor (rsrm). the Contractor Shall Furnish the Necessary Management, Engineering, Labor, Facilities, Tools, Equipment, and Materials Required for First Stage Development, Qualification, Certification and Acceptance Program. Activities Include: Redesign and Testing of the Motor to Incorporate the Fifth Segment and Production of Five Full Scale Ground Static Test Motors: TWO Development Motors (dms)-And Three Qualification Motors (QMS); Structural Test Article (STA), Ground Vibration Test Motors (gvtms) and Other Development Testing; Redesign of the Avionics, Deceleration, Separation, and Flight Termination System (FTS) Subsystems; Ares I-X: Simulated Ares I Outer Mold Line/Mass Properties Using Modified Srb/Rsrm; and Three Flight Test Vehicles. TAS::80 0124::TAS — $4.4B (National Aeronautics and Space Administration)
- Federal Contract — $4.4B (Department of Defense)
View all Northrop Grumman Systems Corporation federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)