DoD's $38.6M Naval Weapons Systems T&E Contract Awarded to Northrop Grumman
Contract Overview
Contract Amount: $38,564,172 ($38.6M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2018-02-01
End Date: 2023-01-31
Contract Duration: 1,825 days
Daily Burn Rate: $21.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST NO FEE
Sector: Defense
Official Description: T&E AND FLEET SUPPORT FOR WEAPONS SYSTEMS/COMBAT SYSTEMS FOR NAVAL PROGRAMS
Place of Performance
Location: DAHLGREN, KING GEORGE County, VIRGINIA, 22448
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $38.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: T&E AND FLEET SUPPORT FOR WEAPONS SYSTEMS/COMBAT SYSTEMS FOR NAVAL PROGRAMS Key points: 1. Significant contract value for specialized engineering services. 2. Northrop Grumman is a major defense contractor, indicating established capabilities. 3. Full and open competition suggests a robust bidding process. 4. Contract duration of 5 years highlights long-term support needs.
Value Assessment
Rating: good
The contract's cost-plus-fixed-fee (CPFF) structure, while common for R&D, can lead to cost overruns if not managed tightly. Benchmarking against similar T&E contracts for naval systems is necessary for a precise value assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating multiple bidders likely participated. This competitive process is expected to drive favorable pricing and ensure the government receives best value.
Taxpayer Impact: Taxpayer funds are being used for critical testing and evaluation, ensuring the effectiveness and safety of naval weapon systems.
Public Impact
Ensures the readiness and effectiveness of naval combat systems. Supports technological advancement and validation in defense. Contributes to the safety and reliability of military equipment.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost growth in CPFF contracts.
- Long-term reliance on a single contractor for critical support.
Positive Signals
- Awarded through full and open competition.
- Supports vital national defense programs.
Sector Analysis
This contract falls within the Engineering Services sector, specifically supporting defense-related testing and evaluation. Spending in this area is crucial for maintaining technological superiority and operational readiness for the Navy.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corporation, a large business. There is no indication of small business participation in this specific award, which is common for large, complex defense contracts.
Oversight & Accountability
The Department of the Navy is responsible for oversight. The contract's duration and complexity necessitate robust monitoring to ensure performance, cost control, and adherence to specifications.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Cost Overruns (CPFF)
- Technological Obsolescence
- Contractor Lock-in
- Lack of Small Business Participation
Tags
engineering-services, department-of-defense, va, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $38.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. T&E AND FLEET SUPPORT FOR WEAPONS SYSTEMS/COMBAT SYSTEMS FOR NAVAL PROGRAMS
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 $38.6 million.
What is the period of performance?
Start: 2018-02-01. End: 2023-01-31.
What is the specific breakdown of costs within the CPFF structure, and how are profit margins determined?
The Cost Plus Fixed Fee (CPFF) structure involves the contractor being reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. Detailed cost breakdowns are typically found in contract exhibits and require careful review by contracting officers to ensure allowability and allocability. Profit margins are negotiated based on factors like risk, complexity, and market rates, and are subject to government cost accounting standards and regulations.
How does the performance of Northrop Grumman on this contract compare to industry benchmarks for similar T&E services?
Assessing Northrop Grumman's performance against industry benchmarks requires access to performance metrics, past performance reviews, and data from comparable contracts. Key indicators include on-time delivery, adherence to technical specifications, cost control effectiveness, and customer satisfaction. A comparative analysis would involve evaluating their track record on similar naval T&E programs and against competitors' performance on analogous contracts.
What are the potential risks associated with the long duration of this contract for the Navy's acquisition strategy?
A long contract duration (5 years) can pose risks such as technological obsolescence if systems evolve rapidly, potential for contractor complacency, and reduced flexibility to adapt to changing requirements or budget constraints. It also ties up significant funding, potentially limiting opportunities for newer, innovative solutions or different contractors in the future. Regular reviews and contract modifications are crucial to mitigate these risks.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: N0017817R3053
Offers Received: 3
Pricing Type: COST NO FEE (S)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 2340 DULLES CORNER BLVD, HERNDON, VA, 20171
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $62,965,063
Exercised Options: $52,477,586
Current Obligation: $38,564,172
Actual Outlays: $4,092,948
Subaward Activity
Number of Subawards: 145
Total Subaward Amount: $385,481,007
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0017804D4091
IDV Type: IDC
Timeline
Start Date: 2018-02-01
Current End Date: 2023-01-31
Potential End Date: 2023-01-31 00:00:00
Last Modified: 2025-05-30
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