DoD awards $58.9M for ATFLIR repairs to Raytheon Company, raising concerns about competition

Contract Overview

Contract Amount: $58,895,677 ($58.9M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2024-09-12

End Date: 2026-10-19

Contract Duration: 767 days

Daily Burn Rate: $76.8K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ATFLIR REPAIRS

Place of Performance

Location: GRAND PRAIRIE, DALLAS County, TEXAS, 75051

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $58.9 million to RAYTHEON COMPANY for work described as: ATFLIR REPAIRS Key points: 1. Significant contract value of $58.9 million for ATFLIR repairs. 2. Sole-source award to Raytheon Company limits competitive pricing. 3. Potential risk associated with single-source repair of critical aircraft components. 4. Spending falls within the 'Other Aircraft Parts' manufacturing sector.

Value Assessment

Rating: questionable

The contract value of $58.9 million for ATFLIR repairs is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar repair services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to Raytheon Company. This lack of competition limits price discovery and may lead to higher costs for the government.

Taxpayer Impact: The absence of competition for critical ATFLIR repairs could result in taxpayers paying a premium for these services.

Public Impact

Ensures continued operational readiness of aircraft equipped with ATFLIR systems. Supports a major defense contractor, potentially impacting jobs and industry stability. Highlights reliance on specific manufacturers for specialized repair services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Potential for overpricing

Positive Signals

Ensures critical system repair
Supports operational readiness

Sector Analysis

This contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector. Spending in this area is crucial for maintaining the defense industrial base and ensuring aircraft availability.

Small Business Impact

The data indicates that small businesses were not involved in this specific contract award, as it was a sole-source award to a large corporation.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential cost overruns. Accountability for the justification of the non-competitive award is essential.

Related Government Programs

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

Risk Flags

Sole-source award limits competition.
Potential for higher costs due to lack of price discovery.
Dependency on a single contractor for critical repairs.
Lack of transparency in pricing justification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $58.9 million to RAYTHEON COMPANY. ATFLIR REPAIRS

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 $58.9 million.

What is the period of performance?

Start: 2024-09-12. End: 2026-10-19.

What is the justification for awarding this contract on a sole-source basis?

The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or the unavailability of alternative sources. For ATFLIR repairs, it might be due to specialized knowledge, tooling, or intellectual property held exclusively by Raytheon Company, making them the only viable option for maintaining the system's integrity and performance.

What are the risks associated with a sole-source repair contract for critical aircraft components?

Sole-source repair contracts for critical components like ATFLIR present risks of inflated pricing due to lack of competition, potential for complacency from the sole provider regarding service quality or turnaround times, and a dependency that could be exploited. It also limits opportunities for other qualified businesses to compete and innovate in the repair market.

How can the Department of Defense ensure value for money in future sole-source repair contracts?

To ensure value, the DoD can conduct thorough market research to confirm the necessity of a sole-source award, negotiate aggressively on price using historical data and independent cost estimates, and explore options for technology transfer or training to enable competition in the future. Implementing robust oversight and performance metrics is also key.

Industry Classification

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

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

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: $58,895,677

Exercised Options: $58,895,677

Current Obligation: $58,895,677

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0038320DWC01

IDV Type: IDC

Timeline