Naval Inventory Control Point contract for electronic assembly manufacturing awarded to TRW Inc. for $27.3M

Contract Overview

Contract Amount: $27,337,754 ($27.3M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2001-09-07

End Date: 2016-09-06

Contract Duration: 5,478 days

Daily Burn Rate: $5.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200112!1P2208!1700!JA104 !NAVAL INVENTORY CONTROL POINT !N0038301C008F !A!N!*!N! !20010907!20040430!121713036!121713036!004179453!N!TRW INC !ONE RANCHO CARMEL !SAN DIEGO !CA!92128!66000!073!06!SAN DIEGO !SAN DIEGO !CALIFORNIA!+000017828321!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A1C!OTHER AIRCRAFT EQUIPMENT !2AEB!E-2 HAWKEYE !334418!*!*!3! ! ! !*!*!*!B!*!*!A! !A !U!J!2!001!B! !A!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!B!N! ! ! ! ! ! !0001!

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92128

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $27.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: 200112!1P2208!1700!JA104 !NAVAL INVENTORY CONTROL POINT !N0038301C008F !A!N!*!N! !20010907!20040430!121713036!121713036!004179453!N!TRW INC !ONE RANCHO CARMEL !SAN DIEGO !CA!92128!66000!073!06!SAN DIEGO !SAN D… Key points: 1. Contract value of $27.3 million for electronic assembly manufacturing. 2. Awarded by the Department of Defense, highlighting a significant defense procurement. 3. Long contract duration of over 15 years suggests a sustained need for these services. 4. The contract falls under the 'Printed Circuit Assembly (Electronic Assembly) Manufacturing' category. 5. TRW Inc. was the original contractor, later acquired by Northrop Grumman, indicating industry consolidation.

Value Assessment

Rating: fair

The contract value of $27.3 million for electronic assembly manufacturing over a 15-year period appears reasonable given the scope. However, without specific details on the quantity and complexity of the assemblies, a precise value-for-money assessment is challenging. Benchmarking against similar contracts for specialized electronic components would provide a clearer picture of pricing efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a robust bidding process. The presence of multiple bidders, though not explicitly detailed in the provided data, is implied by this competition type. This generally leads to more competitive pricing and a wider selection of qualified contractors.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down costs through market forces, ensuring the government receives the best possible value for its investment.

Public Impact

The primary beneficiaries are the U.S. Navy and potentially other Department of Defense branches requiring specialized electronic assemblies. Services delivered include the manufacturing of printed circuit assemblies for various defense systems. The geographic impact is primarily within California, where the contractor TRW Inc. was located. Workforce implications include employment for skilled technicians and engineers involved in electronic manufacturing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to potential cost overruns if not managed effectively.
Reliance on a single contractor for an extended period might limit opportunities for innovation or cost reduction through competition.
The acquisition of TRW Inc. by Northrop Grumman could lead to changes in contract management or pricing structures.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
The contract supports critical defense needs for electronic components.
The contractor, TRW Inc., was a well-established entity in the aerospace and defense sector.

Sector Analysis

This contract falls within the broader aerospace and defense manufacturing sector, specifically focusing on electronic assembly. The market for such specialized components is driven by government procurement, particularly for military applications. Comparable spending benchmarks would involve analyzing other contracts for similar electronic components and manufacturing services within the DoD.

Small Business Impact

The provided data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. However, the prime contractor may engage small businesses as subcontractors, depending on their procurement practices.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor compliance with terms and conditions. Accountability measures would include performance reviews, quality control, and adherence to delivery schedules. Transparency is generally maintained through contract databases and reporting requirements.

Related Government Programs

Defense Electronics Manufacturing
Naval Aviation Support Equipment
Printed Circuit Board Assembly
Aerospace Component Manufacturing
Department of Defense Procurement

Risk Flags

Long contract duration
Industry consolidation (TRW acquisition)
Potential for price increases over time

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. 200112!1P2208!1700!JA104 !NAVAL INVENTORY CONTROL POINT !N0038301C008F !A!N!*!N! !20010907!20040430!121713036!121713036!004179453!N!TRW INC !ONE RANCHO CARMEL !SAN DIEGO !CA!92128!66000!073!06!SAN DIEGO !SAN DIEGO !CALIFORNIA!+000017828321!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A1C!OTHER AIRCRAFT EQUIPMENT !2AEB!E-2 HAWKEYE !334418!*!*!3! ! ! !*!*!*!B!*!*!A!

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $27.3 million.

What is the period of performance?

Start: 2001-09-07. End: 2016-09-06.

What was the specific nature of the 'MISCELLANEOUS COMMUNICATION EQUIPMENT' and 'OTHER AIRCRAFT EQUIPMENT' associated with this contract?

The contract data specifies Product Service Codes (PSCs) like '5895' for Miscellaneous Communication Equipment and 'A1C' for Other Aircraft Equipment, with a specific mention of 'E-2 HAWKEYE' under the latter. This suggests the printed circuit assemblies manufactured were intended for use in communication systems and potentially as components for the E-2 Hawkeye aircraft, a carrier-based airborne early warning aircraft. The 'MISCELLANEOUS' and 'OTHER' classifications indicate a broad range of potential applications within these categories, likely tailored to specific military requirements for communication and surveillance systems.

How did the contract's long duration (over 15 years) impact its overall cost-effectiveness?

A contract duration exceeding 15 years, as seen here (2001-2016), can have mixed effects on cost-effectiveness. On one hand, it provides stability and predictability for both the government and the contractor, potentially leading to economies of scale and reduced administrative overhead compared to frequent re-competitions. This long-term commitment can incentivize the contractor to invest in specialized capabilities and process improvements. However, it also carries risks. Market prices for components and manufacturing processes can fluctuate significantly over such a long period, potentially leading to the government paying above-market rates if the contract terms are not regularly reviewed or adjusted. Furthermore, technological obsolescence is a greater concern, and the government might be locked into using older technologies if the contract doesn't allow for upgrades or transitions. Without detailed cost breakdowns and periodic price adjustments, it's difficult to definitively assess the cost-effectiveness over its entire lifespan.

What does the acquisition of TRW Inc. by Northrop Grumman imply for this specific contract and future procurements?

The acquisition of TRW Inc. by Northrop Grumman in 2002, shortly after this contract's award in 2001, signifies industry consolidation within the defense sector. For this specific contract, it likely meant a transition in ownership and management, potentially leading to changes in how the contract was administered, reported, or even priced, depending on Northrop Grumman's integration strategy. While the contract itself was awarded to TRW, the performance and obligations would have been assumed by Northrop Grumman. This consolidation can lead to fewer, larger prime contractors, which might reduce competition in future procurements for similar services. It can also create opportunities for integrated solutions as Northrop Grumman possesses a broader range of capabilities. However, it raises concerns about market concentration and the potential for reduced price competition in the long run.

Were there any performance issues or contract modifications during the 15-year period?

The provided summary data does not contain specific details regarding contract modifications, performance issues, or disputes related to this contract. The data indicates a single award with a fixed start and end date, and the total obligated amount. To determine if there were performance issues or modifications, one would need to access detailed contract line item (CLIN) data, modification history, and performance reports from the relevant contracting agency (e.g., DCMA or Naval Inventory Control Point). Such information is typically found in more granular contract databases or agency procurement records.

How does the $27.3 million contract value compare to other similar procurements for electronic assembly manufacturing?

Comparing the $27.3 million contract value requires context regarding the quantity, complexity, and specific types of electronic assemblies procured. For a contract spanning over 15 years, this annual average value is relatively modest, suggesting it might have been for specialized, lower-volume components or specific sub-assemblies rather than large-scale production runs. Benchmarking would involve identifying contracts with similar Product Service Codes (PSCs) like '5895' or 'A1C' awarded around the same period, considering factors like contract duration, number of bidders, and the procuring agency. Without such comparative data, it's difficult to definitively state whether this represents excellent, fair, or concerning value for money. However, given the long duration and the nature of defense procurement, the value appears within a plausible range for specialized electronic manufacturing.

Industry Classification

NAICS: Manufacturing › Semiconductor and Other Electronic Component Manufacturing › Printed Circuit Assembly (Electronic Assembly) Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: Northrop Grumman Corporation (UEI: 967356127)

Address: ONE RANCHO CARMEL, SAN DIEGO, CA, 92128

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline