Raytheon Company awarded $16.4M for AN/ALQ-249 support, a sole-source contract

Contract Overview

Contract Amount: $16,428,127 ($16.4M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2024-05-01

End Date: 2026-04-30

Contract Duration: 729 days

Daily Burn Rate: $22.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: FSR ENGINEERING/LOGISTICS SUPPORT OF AN/ALQ-249

Place of Performance

Location: OAK HARBOR, ISLAND County, WASHINGTON, 98278

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $16.4 million to RAYTHEON COMPANY for work described as: FSR ENGINEERING/LOGISTICS SUPPORT OF AN/ALQ-249 Key points: 1. Contract awarded to Raytheon Company for engineering and logistics support. 2. The contract is for support of the AN/ALQ-249 system. 3. This is a sole-source award, indicating limited competition. 4. The contract duration is 729 days. 5. The award type is a delivery order under an existing contract. 6. The North American Industry Classification System (NAICS) code is 334511.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to assess if the $16.4 million price represents fair market value. The Cost Plus Fixed Fee (CPFF) contract type can sometimes lead to higher costs if not closely managed, as the contractor is reimbursed for allowable costs plus a fixed fee. Benchmarking against similar sole-source contracts for advanced electronic warfare systems would be necessary to determine if the pricing is reasonable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one contractor, Raytheon Company, was solicited. This typically occurs when a specific capability is only available from a single source or in situations where full and open competition is not feasible. The lack of competition limits the government's ability to leverage market forces to achieve the best possible price and terms.

Taxpayer Impact: Sole-source awards can potentially result in higher costs for taxpayers as there is no competitive pressure to drive down prices. It also raises questions about whether alternative solutions or providers were adequately explored.

Public Impact

The Department of the Navy benefits from continued engineering and logistics support for the AN/ALQ-249 system. This support is critical for maintaining the operational readiness of naval aviation platforms equipped with the AN/ALQ-249. The contract's impact is primarily within the defense sector, specifically naval aviation. Workforce implications may include continued employment for engineers and logistics specialists at Raytheon.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Cost Plus Fixed Fee contract type may incentivize higher costs if not rigorously overseen.
Lack of transparency in the justification for sole-source award.
Potential for vendor lock-in due to specialized nature of the system.

Positive Signals

Ensures continued support for a critical defense system.
Leverages existing contractor expertise with the AN/ALQ-249 system.
Awarded to a known defense contractor with a track record.

Sector Analysis

The defense electronics sector is characterized by high research and development costs, long product lifecycles, and significant government investment. The AN/ALQ-249 is an advanced electronic warfare system, placing this contract within a specialized niche of defense manufacturing and support. The market for such systems is often dominated by a few large prime contractors due to the complexity and security requirements. Comparable spending benchmarks are difficult to establish without detailed knowledge of the system's capabilities and the specific support required, especially given the sole-source nature of this award.

Small Business Impact

This contract does not appear to involve a small business set-aside, as indicated by 'sb': false. There is no explicit information provided regarding subcontracting plans for small businesses. Given the sole-source nature and the likely specialized technical requirements, the direct impact on the small business ecosystem may be limited unless Raytheon actively engages small businesses for specific support roles.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures would be defined by the terms of the Cost Plus Fixed Fee contract, including cost reporting and performance metrics. Transparency is limited due to the sole-source nature, with justifications for this award typically being internal to the agency. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

AN/ALQ-249 Electronic Warfare System
Naval Aviation Support Programs
Defense Logistics Support Contracts
Raytheon Company Defense Contracts

Risk Flags

Sole-source award may indicate a lack of market research or limited competition.
CPFF contract type carries inherent cost escalation risks for the government.
Lack of publicly available justification for sole-source award.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.4 million to RAYTHEON COMPANY. FSR ENGINEERING/LOGISTICS SUPPORT OF AN/ALQ-249

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $16.4 million.

What is the period of performance?

Start: 2024-05-01. End: 2026-04-30.

What is the specific justification for awarding this contract on a sole-source basis to Raytheon Company?

The provided data does not explicitly state the justification for the sole-source award. Typically, sole-source contracts are justified under specific circumstances outlined in federal acquisition regulations, such as when only one responsible source can provide the required supplies or services, or when there is a compelling urgency. For advanced defense systems like the AN/ALQ-249, justifications often cite unique technical capabilities, proprietary data, or the need to maintain commonality with existing fielded systems. A detailed review of the contract file and the Justification and Approval (J&A) document would be necessary to understand the specific rationale.

How does the Cost Plus Fixed Fee (CPFF) contract type influence the potential cost and risk for the government?

The Cost Plus Fixed Fee (CPFF) contract type reimburses the contractor for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure shifts some of the cost risk to the government, as the final contract price is not fixed upfront and can increase if costs escalate. However, the fixed fee provides the contractor with a stable profit margin. Effective oversight and robust cost accounting standards are crucial for CPFF contracts to ensure that costs are reasonable and allocable, and to prevent cost overruns. The government's ability to control costs is dependent on its diligence in monitoring expenditures and ensuring efficient performance.

What is the historical spending pattern for the AN/ALQ-249 system or similar electronic warfare support by the Department of the Navy?

The provided data only includes details for this specific delivery order ($16.4 million). To assess historical spending patterns for the AN/ALQ-249 system or similar electronic warfare support by the Department of the Navy, a broader search of federal procurement databases (like FPDS or SAM.gov) would be required. This would involve looking for previous contracts awarded for the AN/ALQ-249, including research, development, procurement, and sustainment, as well as contracts for comparable electronic warfare systems. Analyzing these patterns would help establish a baseline for spending and identify trends in contract values, durations, and award types.

What are the key performance metrics or deliverables expected under this contract, and how will they be measured?

The provided data does not specify the key performance metrics or deliverables for this contract. Under a CPFF contract for engineering and logistics support, typical deliverables might include technical reports, maintenance procedures, engineering analyses, logistics plans, and potentially hardware/software updates or repairs. Performance would likely be measured against established technical specifications, delivery schedules, and quality standards. The contract's statement of work (SOW) would detail these requirements and the methods for evaluating the contractor's performance. The government contracting officer's representative (COR) is usually responsible for monitoring performance and ensuring deliverables meet requirements.

What is Raytheon Company's track record with the AN/ALQ-249 system and similar defense contracts?

Raytheon Company is a major defense contractor with extensive experience in developing and supporting complex electronic warfare systems. While specific details on their track record with the AN/ALQ-249 are not in the provided data, their position as a leading provider in this domain suggests a significant history. Their broader portfolio includes numerous contracts for advanced radar, electronic warfare, and command and control systems across various military branches. A comprehensive assessment would involve reviewing past performance evaluations (e.g., CPARS reports) for Raytheon on similar contracts to gauge their reliability, quality of work, and adherence to schedule and budget.

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: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rockwell Collins Australia PTY Limited

Address: 2000 E EL SEGUNDO BLVD, EL SEGUNDO, CA, 90245

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: $25,950,831

Exercised Options: $16,990,102

Current Obligation: $16,428,127

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0016421GWS31

IDV Type: BOA

Timeline