DoD Awards $20.8M for Aircraft Parts to Raytheon Company, Lacking Competition

Contract Overview

Contract Amount: $20,793,204 ($20.8M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2024-08-27

End Date: 2027-02-23

Contract Duration: 910 days

Daily Burn Rate: $22.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CONTROLLER,ELECTRIC

Place of Performance

Location: EL SEGUNDO, LOS ANGELES County, CALIFORNIA, 90245

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $20.8 million to RAYTHEON COMPANY for work described as: CONTROLLER,ELECTRIC Key points: 1. Significant award to a major defense contractor. 2. Lack of competition raises concerns about price discovery. 3. Potential for higher costs due to sole-source nature. 4. Focus on aircraft parts manufacturing.

Value Assessment

Rating: questionable

The award amount of $20.8 million for aircraft parts is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to similar contracts for comparable parts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source or limited competition scenario. This significantly impacts price discovery, potentially leading to higher costs for taxpayers as the government may not have received the best possible price.

Taxpayer Impact: The lack of competition in this $20.8 million award means taxpayers may be paying a premium for these aircraft parts.

Public Impact

Taxpayers may be overpaying for essential aircraft components. Limited visibility into the justification for sole-source procurement. Potential impact on the readiness of naval aircraft due to parts availability or cost.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source procurement
Lack of price competition
Potential for cost overruns

Positive Signals

Award to established contractor
Supports critical defense needs

Sector Analysis

This contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector. Spending in this area is crucial for defense readiness, but competitive sourcing is vital to ensure cost-effectiveness.

Small Business Impact

The data indicates this contract was not awarded to a small business. Further analysis would be needed to determine if small businesses were considered or had the opportunity to compete.

Oversight & Accountability

Oversight is needed to understand the justification for the sole-source award and to ensure the price paid is fair and reasonable, especially given the lack of competition.

Related Government Programs

Other Aircraft Parts and Auxiliary Equipment Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for price inflation
Limited transparency on justification
No small business participation indicated

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.8 million to RAYTHEON COMPANY. CONTROLLER,ELECTRIC

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 $20.8 million.

What is the period of performance?

Start: 2024-08-27. End: 2027-02-23.

What is the specific justification for awarding this contract on a sole-source basis, and were alternative competitive strategies explored?

The justification for sole-source procurement is critical. Agencies typically use sole-source contracts when only one responsible source can provide the required supplies or services. This could be due to unique capabilities, proprietary technology, or urgent needs. A thorough review should confirm that all avenues for competition were exhausted and that this approach is truly necessary and in the government's best interest.

How does the awarded price compare to industry benchmarks for similar aircraft parts, given the lack of competitive bids?

Without competitive bids, assessing the price's fairness is challenging. A price reasonableness analysis should be conducted, comparing the awarded price to historical data, commercial price lists, or prices paid by other government agencies for similar items. If benchmarks indicate a significant deviation, it warrants further investigation into the cost drivers and the sole-source justification.

What is the potential long-term impact on the Department of the Navy's budget and aircraft readiness due to this non-competitive award?

A non-competitive award, especially for critical aircraft parts, can lead to higher unit costs over the contract's duration, potentially straining the Navy's budget. This could necessitate budget adjustments or lead to reduced procurement of other necessary items. Furthermore, reliance on a single source might create supply chain vulnerabilities or delays, impacting aircraft maintenance schedules and overall operational readiness.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0038324RD175

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

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: $34,935,560

Exercised Options: $34,935,560

Current Obligation: $20,793,204

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0038319GUX01

IDV Type: BOA

Timeline