DoD awards $163M for wireless communications equipment, with Rockwell Collins as sole source

Contract Overview

Contract Amount: $16,309,116 ($16.3M)

Contractor: Rockwell Collins, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-08-19

End Date: 2026-11-30

Contract Duration: 833 days

Daily Burn Rate: $19.6K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: RT-2036(C)/ARC W/ 5-YR WARRANTY

Place of Performance

Location: CEDAR RAPIDS, LINN County, IOWA, 52498

State: Iowa Government Spending

Plain-Language Summary

Department of Defense obligated $16.3 million to ROCKWELL COLLINS, INC. for work described as: RT-2036(C)/ARC W/ 5-YR WARRANTY Key points: 1. Contract awarded on a sole-source basis, raising questions about price competition. 2. Significant duration of 833 days suggests a long-term need for these services. 3. The contract is a delivery order under an existing contract, indicating potential for follow-on work. 4. No small business set-aside was applied, potentially limiting opportunities for smaller firms. 5. The award is for firm-fixed-price, which shifts cost risk to the contractor. 6. The North American Industry Classification System (NAICS) code 334220 points to a specialized manufacturing sector.

Value Assessment

Rating: questionable

Benchmarking the value of this $163 million contract is challenging without comparable sole-source awards for similar wireless communications equipment. The firm-fixed-price structure is standard for equipment procurement, but the lack of competition makes it difficult to assess if the pricing represents optimal value for the government. Without competitive bids, it's impossible to determine if the government secured the best possible price or if there's potential for overpayment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Rockwell Collins, Inc., was solicited. This significantly limits price discovery and competitive pressure. While sole-source awards can be justified for unique capabilities or existing systems, the lack of competition here means taxpayers may not be receiving the most cost-effective solution available in the market.

Taxpayer Impact: The absence of competition means taxpayers are not benefiting from the potential cost savings that typically arise from a competitive bidding process.

Public Impact

The Department of the Navy benefits from the acquisition of critical wireless communications equipment. This equipment is essential for maintaining operational readiness and communication capabilities. The contract supports the manufacturing sector, specifically in wireless communications technology. The geographic impact is primarily tied to the contractor's facilities and the operational areas of the Navy.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Lack of transparency in the justification for a sole-source award.
Potential for vendor lock-in if this equipment is proprietary or deeply integrated.

Positive Signals

Firm-fixed-price contract shifts cost risk to the contractor.
Award is a delivery order under an existing contract, suggesting established relationship and potential efficiencies.
Rockwell Collins is a known entity in defense contracting, implying some level of established performance.

Sector Analysis

The contract falls within the Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing sector (NAICS 334220). This is a critical sector for defense, providing essential communication tools. The market for such specialized equipment is often characterized by high barriers to entry due to technological complexity and stringent performance requirements. Comparable spending in this sector for defense applications can vary widely based on specific technological needs and quantities.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements mentioned in the provided data. This means that opportunities for small businesses to participate in this specific award are limited. The prime contractor, Rockwell Collins, Inc., will likely fulfill the contract using its own resources or through its established supply chain, which may or may not involve small business subcontractors.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations. As a delivery order under an existing contract, the initial award and justification for sole-sourcing would have undergone review. Accountability measures are inherent in the firm-fixed-price structure, which penalizes cost overruns by the contractor. Transparency is limited due to the sole-source nature of the award.

Related Government Programs

Department of Defense Communications Equipment Procurement
Navy Radio and Wireless Systems
Sole-Source Defense Contracts
Wireless Communications Manufacturing

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for unbenchmarked pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.3 million to ROCKWELL COLLINS, INC.. RT-2036(C)/ARC W/ 5-YR WARRANTY

Who is the contractor on this award?

The obligated recipient is ROCKWELL COLLINS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $16.3 million.

What is the period of performance?

Start: 2024-08-19. End: 2026-11-30.

What is the specific justification for awarding this contract on a sole-source basis to Rockwell Collins, Inc.?

The provided data indicates the contract was awarded as 'NOT COMPETED' and is a sole-source award. A formal justification for other than full and open competition (J&A) would typically be required by federal acquisition regulations. This justification would detail why full and open competition was not feasible or not in the government's best interest. Common reasons include the existence of unique capabilities held by only one source, urgent and compelling needs where competition would cause unacceptable delays, or if the contract is a follow-on to a previously competed contract where only the original contractor can provide the necessary services or equipment due to interoperability or standardization requirements. Without access to the J&A document, the specific rationale remains unknown, but it is a critical piece of information for assessing the value and necessity of this sole-source award.

How does the $163 million value of this contract compare to similar wireless communications equipment procurements by the Department of the Navy?

Direct comparison of this $163 million contract to similar procurements is difficult without knowing the exact specifications of the wireless communications equipment and its intended use. However, $163 million represents a substantial investment. The Department of the Navy procures a wide range of communication systems, from tactical radios to strategic network infrastructure. Awards in the tens to hundreds of millions of dollars are not uncommon for major system acquisitions. The sole-source nature of this award, however, complicates value assessment. In a competitive environment, similar capabilities might be procured for less. To perform a robust comparison, one would need to identify other competitive awards for comparable systems, analyze the quantities, features, and contract terms, and then benchmark the per-unit costs and overall value.

What are the potential risks associated with a sole-source award of this magnitude for wireless communications equipment?

The primary risk associated with a sole-source award of this magnitude is the potential for inflated pricing due to the lack of competitive pressure. The government may end up paying more than it would have in a competitive scenario. Another risk is vendor lock-in; if the procured equipment is proprietary or requires specialized support, the government may become dependent on Rockwell Collins for future upgrades, maintenance, and spare parts, potentially at non-competitive prices. Furthermore, a sole-source award can reduce transparency and accountability, making it harder to verify that the government is receiving the best value. There's also a risk that the chosen technology might not be the most innovative or cost-effective solution available on the market, as competition often drives innovation.

What is Rockwell Collins, Inc.'s track record with the Department of the Navy and in providing wireless communications equipment?

Rockwell Collins, Inc. (now part of Collins Aerospace, a Raytheon Technologies company) has a long-standing history of providing avionics, communication, and simulation systems to the U.S. military, including the Department of the Navy. They are a significant defense contractor known for its expertise in integrated flight decks, communication and navigation systems, and electronic warfare. Their track record with the Navy likely includes numerous contracts for various platforms, from aircraft to ships. Given their established presence and the nature of this award as a delivery order under an existing contract, it suggests a prior successful relationship and demonstrated capability in delivering the required wireless communications equipment. However, a detailed review of past performance ratings and any past issues would be necessary for a complete assessment.

How does the firm-fixed-price contract type mitigate or transfer risk in this scenario?

A firm-fixed-price (FFP) contract type is generally preferred by the government when the scope of work is well-defined and the risks are understood. In this case, with Rockwell Collins, Inc. providing specific wireless communications equipment, the scope is likely well-defined. The FFP structure means that the contractor agrees to a total price for the specified goods. This transfers the risk of cost overruns from the government to the contractor. If Rockwell Collins incurs higher-than-expected costs during manufacturing or delivery, their profit margin will decrease, but the government's payment obligation remains fixed. Conversely, if they manage costs efficiently, their profit will increase. This contract type incentivizes the contractor to control costs and perform efficiently to maximize their profit.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0042122R0154

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 400 COLLINS RD NE, CEDAR RAPIDS, IA, 52498

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: $16,309,116

Exercised Options: $16,309,116

Current Obligation: $16,309,116

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0042123D0001

IDV Type: IDC

Timeline