Northrop Grumman received over $75M for aircraft launching equipment, awarded via full and open competition

Contract Overview

Contract Amount: $75,283,596 ($75.3M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 1999-12-10

End Date: 2005-03-31

Contract Duration: 1,938 days

Daily Burn Rate: $38.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: 200003!1700!000188!A8050 !NAVAL AIR WARFARE CENTER, AIRCRA!N6833500C0208 !A!*!* !19991210!20031230!001864081!008255408!008255408!N!04821!NORTHROP GRUMMAN CORPORATION !401 E. HENDY AVE !SUNNYVALE !CA!94088!77000!085!06!SUNNYVALE !SANTA CLARA !CALIFORNIA!0001!+000014000000!N!N!000000000000!1720!AIRCRAFT LAUNCHING EQUIPMENT !C9E!ALL OTHER SUPPLIES AND EQUIPME!2000!NOT DISCERNABLE OR CLASSIFIED !3728!3!*!*!*!B!A!*!A !N!R!2!007!B!* !A!N!Z!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: SUNNYVALE, SANTA CLARA County, CALIFORNIA, 94086

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $75.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: 200003!1700!000188!A8050 !NAVAL AIR WARFARE CENTER, AIRCRA!N6833500C0208 !A!*!* !19991210!20031230!001864081!008255408!008255408!N!04821!NORTHROP GRUMMAN CORPORATION !401 E. HENDY AVE !SUNNYVALE !CA!94088!77000!085!06!SUNNYVALE !SAN… Key points: 1. Contract awarded for aircraft launching equipment, indicating a need for specialized aerospace support. 2. The contract was competed openly, suggesting a competitive market for these services. 3. A long contract duration of over 1900 days implies a significant, ongoing requirement. 4. The contract type, Cost Plus Award Fee, incentivizes performance while managing costs. 5. Northrop Grumman, a major defense contractor, is well-positioned to fulfill this type of requirement. 6. The contract was awarded to a large business, with no indication of small business set-aside.

Value Assessment

Rating: good

The total award amount of $75.3 million over approximately 5.3 years for aircraft launching equipment appears reasonable given the specialized nature of the equipment and the contractor's expertise. Benchmarking against similar contracts is difficult without more specific details on the scope of work, but the duration and value suggest a substantial program. The Cost Plus Award Fee (CPAF) structure allows for performance incentives, which can drive value if managed effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders likely had the opportunity to submit proposals. The presence of 7 bids suggests a healthy level of competition for this requirement. This competitive process is expected to drive more favorable pricing and ensure the government receives the best value proposition.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a more competitive environment that can lead to lower prices and higher quality services.

Public Impact

The primary beneficiaries are likely the U.S. Navy and potentially other branches of the Department of Defense requiring aircraft launching systems. The services delivered involve the provision, maintenance, or upgrade of aircraft launching equipment, crucial for naval aviation operations. The geographic impact is centered around naval air stations and aircraft carriers where such equipment is deployed. Workforce implications may include specialized engineers, technicians, and support staff employed by Northrop Grumman and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Award Fee contracts if not closely monitored.
Long contract duration could lead to complacency or reduced urgency if performance metrics are not rigorously enforced.
Dependence on a single large contractor for critical aerospace equipment could pose supply chain risks.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Northrop Grumman is a reputable defense contractor with a strong track record in aerospace.
The Cost Plus Award Fee structure provides incentives for meeting or exceeding performance targets.
The contract addresses a critical need for naval aviation operational readiness.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically related to aircraft support equipment. The market for such specialized components is often dominated by a few large, established defense contractors. Spending in this area is driven by military readiness requirements and the lifecycle of naval aviation platforms. Comparable spending benchmarks would typically be found within the broader DoD procurement of aviation systems and components.

Small Business Impact

The data indicates this contract was awarded to a large business (Northrop Grumman) and does not mention any small business set-aside provisions. There is no explicit information on subcontracting plans for small businesses. Without this information, it's difficult to assess the direct impact on the small business ecosystem, though large prime contractors often utilize small businesses for various components and services.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The Cost Plus Award Fee structure implies specific performance metrics and award criteria that are subject to review. Transparency is generally maintained through contract reporting mechanisms, though specific details of award fee determinations may be sensitive.

Related Government Programs

Naval Aviation Systems
Aircraft Components and Parts
Defense Logistics and Support
Aerospace Manufacturing
Military Aircraft Equipment

Risk Flags

Long contract duration
Cost Plus Award Fee contract type
Potential for cost overruns
Specialized equipment dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $75.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. 200003!1700!000188!A8050 !NAVAL AIR WARFARE CENTER, AIRCRA!N6833500C0208 !A!*!* !19991210!20031230!001864081!008255408!008255408!N!04821!NORTHROP GRUMMAN CORPORATION !401 E. HENDY AVE !SUNNYVALE !CA!94088!77000!085!06!SUNNYVALE !SANTA CLARA !CALIFORNIA!0001!+000014000000!N!N!000000000000!1720!AIRCRAFT LAUNCHING EQUIPMENT !C9E!ALL OTHER SUPPLIES AND EQUIPME!2000!NOT DISCERNABLE OR CLASSIFIED !3728!3!*!*!*!B!A!*!A !N!R!

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $75.3 million.

What is the period of performance?

Start: 1999-12-10. End: 2005-03-31.

What is Northrop Grumman's track record with similar defense contracts, particularly those involving aircraft launching systems?

Northrop Grumman has an extensive history of performing complex defense contracts, including those related to aerospace systems and components. While specific details on their performance for aircraft launching systems under this particular contract (N6833500C0208) are not fully detailed in the provided data, the company is a major player in the aerospace and defense industry. They are known for producing a wide range of aircraft, including military variants, and associated systems. Their track record generally includes successful execution of large-scale, technologically advanced projects for the Department of Defense. Performance metrics and award fee outcomes for this specific contract would be detailed in internal DoD reporting and contractor performance assessments, which are not publicly available in this dataset.

How does the $75.3 million total award value compare to the typical cost of aircraft launching equipment contracts?

The total award value of $75.3 million for aircraft launching equipment over a period of approximately 5.3 years (from December 1999 to March 2005) represents a significant investment. However, directly comparing this value without detailed scope of work is challenging. Aircraft launching systems, such as catapults and arresting gear for naval vessels, are highly specialized, technologically complex, and critical pieces of equipment. Their cost is influenced by factors like the specific type of system (e.g., steam catapults vs. electromagnetic catapults), the number of units, integration requirements, training, and long-term maintenance. Given Northrop Grumman's role as a major defense contractor and the critical nature of naval aviation support, this value is plausible for a substantial contract covering development, production, or sustainment of such systems.

What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract for this type of equipment?

Cost Plus Award Fee (CPAF) contracts, like the one awarded to Northrop Grumman, carry inherent risks primarily related to cost control and oversight. The 'cost plus' component means the contractor is reimbursed for allowable costs incurred, plus a fee that is composed of a fixed base amount and an award amount. The award amount is contingent upon meeting or exceeding certain performance objectives. The risk for the government is that contractors may have less incentive to control costs rigorously compared to fixed-price contracts, as costs are generally reimbursed. If the performance objectives are not clearly defined, measurable, or are poorly managed, the government might end up paying a higher fee than warranted. Effective oversight by the contracting agency is crucial to monitor costs, ensure performance standards are met, and fairly determine the award fee.

How effective is full and open competition in ensuring value for money for specialized defense equipment like aircraft launching systems?

Full and open competition is generally considered the most effective method for ensuring value for money, even for specialized defense equipment. By allowing all responsible sources to submit bids, it maximizes the pool of potential suppliers, fostering a competitive environment. This competition drives down prices, encourages innovation, and ensures that the government has access to the best available technology and services. For specialized equipment like aircraft launching systems, where the market might be limited, full and open competition is crucial to identify all capable vendors and prevent sole-source situations that could lead to inflated prices. The fact that 7 bids were received in this instance suggests that the market, while specialized, was sufficiently competitive to yield multiple offers.

What are the historical spending patterns for aircraft launching equipment within the Department of Defense?

Historical spending patterns for aircraft launching equipment within the Department of Defense are characterized by significant, long-term investments driven by the needs of naval aviation and air bases. This spending typically covers research and development, procurement of new systems (like the transition from steam to electromagnetic catapults on aircraft carriers), sustainment, modernization, and upgrades of existing equipment. Contracts are often awarded to major defense contractors specializing in aerospace systems. Spending can fluctuate based on shipbuilding schedules, aircraft carrier fleet modernization programs, and advancements in launch technology. While the specific data for this contract ($75.3M) provides a snapshot, broader DoD budgets for aviation support systems and naval readiness illustrate a consistent, substantial allocation of resources to ensure the operational capability of carrier and shore-based aviation.

Industry Classification

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

Product/Service Code: AEROSPACE CRAFT LAUNCHING, LANDING, GROUND HANDLING AND SERVICING EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 7

Pricing Type: COST PLUS AWARD FEE (R)

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 401 E. HENDY AVE, SUNNYVALE, CA, 94088

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline