DoD Awards Raytheon $60.3M for FLIR Systems, Raising Concerns Over Competition and Value

Contract Overview

Contract Amount: $60,282,531 ($60.3M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2023-10-01

End Date: 2024-09-30

Contract Duration: 365 days

Daily Burn Rate: $165.2K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: MTS FLIR THIRD DELIVERY ORDER

Place of Performance

Location: MCKINNEY, COLLIN County, TEXAS, 75071

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $60.3 million to RAYTHEON COMPANY for work described as: MTS FLIR THIRD DELIVERY ORDER Key points: 1. Significant award to a single large contractor, Raytheon Company. 2. Lack of competition raises questions about price discovery and potential overspending. 3. The contract is for 'Other Electronic Component Manufacturing', a broad category. 4. The award is a delivery order under an existing contract, potentially limiting new competition.

Value Assessment

Rating: questionable

The award of $60.3 million for FLIR systems lacks a clear benchmark for value. Without competitive bidding, it's difficult to assess if this price is reasonable compared to market alternatives or similar government contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was not competed, indicating a limited competition approach. This likely restricts the government's ability to secure the best possible pricing through a competitive process, potentially leading to higher costs.

Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for these FLIR systems.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. The Department of Defense is acquiring critical FLIR systems without exploring potentially more cost-effective options. Transparency in defense spending is reduced when contracts are not openly competed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for overpricing
Limited transparency

Positive Signals

Award to established contractor
Specific delivery order for FLIR systems

Sector Analysis

This award falls under 'Other Electronic Component Manufacturing' within the Department of Defense sector. Benchmarks for this specific sub-sector are difficult to ascertain without more detailed product information, but significant defense contracts often involve substantial sums.

Small Business Impact

The contract was awarded to Raytheon Company, a large defense contractor. There is no indication that small businesses were involved in this specific delivery order, suggesting a missed opportunity for small business participation.

Oversight & Accountability

The Department of the Navy awarded this delivery order. Oversight is crucial to ensure the necessity and fair pricing of this non-competed award, especially given the significant dollar amount.

Related Government Programs

Other Electronic Component Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Lack of competition
Potential for inflated pricing
Limited transparency in award justification
Missed opportunity for small business engagement

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $60.3 million to RAYTHEON COMPANY. MTS FLIR THIRD DELIVERY ORDER

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 $60.3 million.

What is the period of performance?

Start: 2023-10-01. End: 2024-09-30.

What is the justification for not competing this significant delivery order for FLIR systems?

The justification for not competing this delivery order is not provided in the data. Typically, non-competitive awards are made under specific circumstances such as urgent need, sole-source provider, or if it's a follow-on order to a previously competed contract where competition is not feasible or cost-effective. Further investigation would be needed to determine the specific rationale.

How does the unit cost of these FLIR systems compare to similar systems procured competitively?

Without a competitive benchmark or detailed specifications of the FLIR systems, it is impossible to determine the unit cost comparison. The lack of competition means there is no direct market comparison available for this specific procurement. A review of historical competitive awards for similar systems would be necessary to establish a benchmark.

What is the potential impact on future defense procurement strategies if non-competitive awards of this magnitude become common?

If non-competitive awards of this magnitude become common, it could lead to reduced innovation, higher overall defense spending, and a decrease in the perceived fairness of government contracting. It may also disincentivize smaller businesses from competing for defense contracts if large, established contractors are consistently awarded work without competition.

Industry Classification

NAICS: Manufacturing › Semiconductor and Other Electronic Component Manufacturing › Other Electronic Component Manufacturing

Product/Service Code: FIRE CONTROL EQPT.

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rockwell Collins Australia PTY Limited

Address: 2501 W UNIVERSITY DR, MCKINNEY, TX, 75071

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: $60,282,531

Exercised Options: $60,282,531

Current Obligation: $60,282,531

Subaward Activity

Number of Subawards: 23

Total Subaward Amount: $4,130,701

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0038322DTH01

IDV Type: IDC

Timeline