DoD's $3.77M I-Stalker System Components contract awarded to BAE Systems without competition

Contract Overview

Contract Amount: $3,768,049 ($3.8M)

Contractor: BAE Systems Space & Mission Systems Inc.

Awarding Agency: Department of Defense

Start Date: 2024-06-11

End Date: 2026-01-06

Contract Duration: 574 days

Daily Burn Rate: $6.6K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TT&E OF I-STALKER SYSTEM COMPONENTS

Place of Performance

Location: BOULDER, BOULDER County, COLORADO, 80301

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $3.8 million to BAE SYSTEMS SPACE & MISSION SYSTEMS INC. for work described as: TT&E OF I-STALKER SYSTEM COMPONENTS Key points: 1. Contract awarded on a sole-source basis, raising questions about potential price overruns and lack of market pressure. 2. The contract duration of 574 days suggests a moderate-term need for these specialized system components. 3. The specific NAICS code (334511) points to a niche manufacturing sector for search, detection, and navigation instruments. 4. Awarded by the Department of the Navy, indicating a focus on maritime or naval applications for the I-Stalker system. 5. The firm-fixed-price contract type aims to control costs, but the lack of competition limits benchmarking. 6. No small business set-aside was utilized, suggesting the contractor is likely a large, established entity.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature. Without competitive bids, it's difficult to ascertain if the $3.77 million price reflects fair market value or if it includes a premium due to the lack of competition. The firm-fixed-price structure provides some cost certainty, but the absence of comparative pricing from other vendors makes a definitive value-for-money assessment difficult. Further analysis would require understanding the specific components and their market prices.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, BAE Systems Space & Mission Systems Inc., was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. The lack of competition means there were no other bidders to compare against, potentially limiting price discovery and the government's ability to secure the most advantageous terms.

Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying a non-competitive price. Without the pressure of multiple bids, the awarded price may not be the lowest achievable, potentially leading to less efficient use of public funds.

Public Impact

The primary beneficiary is the Department of the Navy, which will receive critical components for the I-Stalker system. The services delivered involve the manufacturing and supply of specialized search, detection, navigation, guidance, aeronautical, and nautical system instruments. The geographic impact is likely concentrated where the I-Stalker system is deployed, potentially globally for naval operations. Workforce implications may include specialized manufacturing roles within BAE Systems and potentially its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential for cost savings.
Lack of transparency in the procurement process due to non-competitive nature.
Potential for vendor lock-in if I-Stalker system components are highly specialized and proprietary.

Positive Signals

Firm-fixed-price contract type provides cost certainty for the government.
Award to an established contractor like BAE Systems may indicate reliability and proven capability.
Contract duration suggests a defined scope and timeline for delivery.

Sector Analysis

The contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector (NAICS 334511). This is a specialized segment of the defense industrial base focused on high-technology components for military platforms. The market for such components is often characterized by limited suppliers, high research and development costs, and significant government procurement. Comparable spending benchmarks are difficult to establish without more specific details on the I-Stalker system's function and the exact components being procured.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). The award to BAE Systems, a large defense contractor, suggests that the procurement was not specifically targeted towards small businesses. There is no indication of subcontracting plans for small businesses within the provided data, which could limit opportunities for the small business ecosystem in this specific procurement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. As a sole-source award, there may be heightened scrutiny from oversight bodies like the Government Accountability Office (GAO) or the Department of Defense Inspector General (DoDIG) if concerns arise regarding the procurement process or pricing. Transparency is limited by the non-competitive nature, but contract performance reporting and payment milestones would be subject to standard government oversight.

Related Government Programs

Naval Systems Procurement
Defense Electronics Manufacturing
Search and Navigation Systems
Aerospace and Defense Components
BAE Systems Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for non-competitive pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $3.8 million to BAE SYSTEMS SPACE & MISSION SYSTEMS INC.. TT&E OF I-STALKER SYSTEM COMPONENTS

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS SPACE & MISSION 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 $3.8 million.

What is the period of performance?

Start: 2024-06-11. End: 2026-01-06.

What is the specific function and criticality of the I-Stalker system components being procured?

The provided data indicates the contract is for 'TT&E OF I-STALKER SYSTEM COMPONENTS' under NAICS code 334511, which covers 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing.' While the exact function of the 'I-Stalker' system is not detailed, the NAICS code suggests these components are critical for military platforms requiring advanced sensing, location, and directional capabilities. These could range from radar and sonar systems to advanced navigation and targeting instruments. The criticality is implied by the sole-source award from the Department of the Navy, suggesting these are specialized, potentially proprietary, components essential for specific naval operations where BAE Systems is the sole qualified provider.

How does the $3.77 million price compare to similar sole-source procurements for specialized defense components?

Directly comparing the $3.77 million price to similar sole-source procurements for specialized defense components is challenging without more granular data on the specific nature of the 'I-Stalker system components.' Sole-source awards inherently lack competitive benchmarking, often leading to higher prices than if multiple vendors had bid. However, for complex, high-technology defense systems, a price point in the millions for components over an approximate 1.5-year period (574 days) is not unusual. To assess value, one would need to compare the unit cost, quantity, and complexity of these components against other sole-source contracts for similar technological capabilities, considering factors like R&D investment and proprietary technology.

What are the potential risks associated with awarding this contract on a sole-source basis to BAE Systems?

The primary risk of a sole-source award is the lack of competitive pressure, which can lead to inflated pricing and reduced incentive for the contractor to innovate or optimize costs. Taxpayers may end up paying more than necessary. Another risk is vendor lock-in; if the I-Stalker system relies heavily on BAE Systems' proprietary technology, the government may be dependent on them for future upgrades, maintenance, and replacements, potentially at unfavorable terms. Furthermore, the absence of competition can sometimes mask underlying performance issues or inefficiencies, as there are no alternative vendors to compare against.

What is BAE Systems' track record with the Department of the Navy for similar types of contracts?

BAE Systems is a major defense contractor with a significant and long-standing relationship with the Department of the Navy and other branches of the U.S. military. They have a broad portfolio encompassing shipbuilding, electronic systems, ordnance, and intelligence, information, and cyber solutions. While specific details on their track record for 'I-Stalker system components' are not provided, their extensive experience suggests a high level of technical capability and familiarity with naval requirements. However, like any large contractor, they may have faced scrutiny on specific contracts regarding cost, schedule, or performance in the past. A deeper dive into their contract history with the Navy would reveal specific performance metrics and any past issues.

How does this contract fit into the broader context of Department of the Navy spending on search, detection, and navigation systems?

This $3.77 million contract for I-Stalker system components represents a small fraction of the Department of the Navy's overall budget, which runs into the tens of billions annually. However, within the specific niche of 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' (NAICS 334511), it could be a significant procurement. The Navy invests heavily in advanced sensor and navigation technologies to maintain its operational advantage. This contract likely supports a specific platform or program requiring these specialized instruments, contributing to the Navy's broader efforts in intelligence, surveillance, reconnaissance, and operational readiness.

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: N0016423RJQ04

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1600 COMMERCE ST UNIT 1, BOULDER, CO, 80301

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: $3,768,049

Exercised Options: $3,768,049

Current Obligation: $3,768,049

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $108,470

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0016424DJQ04

IDV Type: IDC

Timeline