DoD's $1.5B 'UNTETHERED GOAT' contract awarded to Northrop Grumman for transportation equipment
Contract Overview
Contract Amount: $15,011,640 ($15.0M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2023-12-27
End Date: 2027-12-26
Contract Duration: 1,460 days
Daily Burn Rate: $10.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: Transportation
Official Description: UNTETHERED GOAT
Place of Performance
Location: ANNAPOLIS, ANNE ARUNDEL County, MARYLAND, 21409
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $15.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: UNTETHERED GOAT Key points: 1. Significant investment in transportation equipment manufacturing. 2. Northrop Grumman is a major defense contractor, indicating established capabilities. 3. Potential risks associated with cost-plus contracts and long durations. 4. The 'All Other Transportation Equipment Manufacturing' sector is broad, requiring specific context.
Value Assessment
Rating: questionable
The Cost Plus Fixed Fee (CPFF) contract structure can lead to cost overruns if not managed tightly. The fixed fee provides some incentive for the contractor, but the government bears the risk of increased costs. Benchmarking is difficult without specific unit details.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the specific details of the price discovery mechanism within the CPFF structure are not provided, making it hard to assess the effectiveness of competition in driving down costs.
Taxpayer Impact: The government is bearing the cost risk in this CPFF contract. Effective oversight is crucial to ensure taxpayer funds are used efficiently and the final cost reflects fair value.
Public Impact
Impacts the defense industrial base and supply chains for specialized transportation equipment. Potential for technological advancements in transportation equipment driven by defense needs. Job creation in manufacturing and related support services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type carries inherent cost escalation risk.
- Long contract duration (4 years) increases exposure to market and technological changes.
- Lack of specific unit cost data hinders precise value assessment.
Positive Signals
- Awarded under full and open competition.
- Northrop Grumman is a reputable and experienced contractor.
- Contract aims to fulfill critical defense needs.
Sector Analysis
This contract falls under 'All Other Transportation Equipment Manufacturing,' a broad category. Benchmarking spending in this specific sub-sector is challenging without more granular data on the type of equipment being procured.
Small Business Impact
The data indicates the prime contractor is Northrop Grumman Systems Corporation, a large business. There is no explicit information on subcontracting to small businesses within this award notice.
Oversight & Accountability
The contract is a Delivery Order under a larger contract. Oversight will focus on managing the CPFF structure, ensuring milestones are met, and controlling costs throughout the contract's duration. The number of delivery orders (3) suggests ongoing tasking.
Related Government Programs
- All Other Transportation Equipment Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Cost escalation risk due to CPFF structure.
- Long contract duration (4 years).
- Lack of specific equipment details for precise benchmarking.
- Potential for scope creep in 'All Other Transportation Equipment Manufacturing'.
Tags
all-other-transportation-equipment-manuf, department-of-defense, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. UNTETHERED GOAT
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 (Department of the Navy).
What is the total obligated amount?
The obligated amount is $15.0 million.
What is the period of performance?
Start: 2023-12-27. End: 2027-12-26.
What specific type of transportation equipment is being procured under this contract, and how does its cost compare to similar systems?
The contract notice does not specify the exact type of transportation equipment. It falls under 'All Other Transportation Equipment Manufacturing.' Without this detail, a precise cost comparison to similar systems is impossible. The $1.5 billion total value and CPFF structure suggest a complex or high-value system, but further information is needed for a meaningful benchmark.
What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) structure for this $1.5 billion contract?
The primary risk with a CPFF contract is that the government bears the majority of the cost risk. If Northrop Grumman's costs exceed initial estimates, the government pays more. While the fixed fee provides some incentive for efficiency, it doesn't eliminate the risk of cost overruns, especially over a four-year period for potentially complex transportation equipment.
How effectively does the 'full and open competition' ensure value for money given the CPFF contract type?
Full and open competition is a positive step for price discovery. However, its effectiveness in ensuring value for money with a CPFF contract is moderated by the contract type itself. While competition may have driven a reasonable initial fixed fee, the government still assumes cost escalation risk. Robust oversight and clear performance metrics are essential to maximize value.
Industry Classification
NAICS: Manufacturing › Other Transportation Equipment Manufacturing › All Other Transportation Equipment Manufacturing
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: N6660417R0350
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 895 OCEANIC DR, ANNAPOLIS, MD, 21409
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: $17,790,000
Exercised Options: $17,639,582
Current Obligation: $15,011,640
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N6660418DC817
IDV Type: IDC
Timeline
Start Date: 2023-12-27
Current End Date: 2027-12-26
Potential End Date: 2027-12-26 00:00:00
Last Modified: 2025-10-31
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