DoD Awards Raytheon $6.47M for JMEWS Long Lead Material, No Competition

Contract Overview

Contract Amount: $6,470,259 ($6.5M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2025-11-26

End Date: 2027-04-28

Contract Duration: 518 days

Daily Burn Rate: $12.5K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: JMEWS LONG LEAD MATERIAL

Place of Performance

Location: TUCSON, PIMA County, ARIZONA, 85706

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $6.5 million to RAYTHEON COMPANY for work described as: JMEWS LONG LEAD MATERIAL Key points: 1. Significant award for critical long-lead material for JMEWS. 2. Sole-source award to Raytheon Company raises competition concerns. 3. Cost-plus-fixed-fee contract type may lead to cost overruns. 4. Engineering services sector, NAICS 541330, often involves complex R&D.

Value Assessment

Rating: questionable

The contract is Cost Plus Fixed Fee, which can be less price-efficient than fixed-price contracts. Without competitive bidding, it's difficult to assess if the $6.47M price is optimal.

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 limits price discovery and potentially increases costs for taxpayers.

Taxpayer Impact: The lack of competition for this significant award may result in higher costs for taxpayers compared to a competitively bid contract.

Public Impact

Taxpayers may be paying a premium due to the absence of competition. The JMEWS program's reliance on this sole-source material could impact future program costs. Lack of transparency in pricing due to sole-source nature.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost-plus-fixed-fee contract type
Lack of transparency in pricing

Positive Signals

Award supports critical JMEWS program
Experienced contractor (Raytheon)

Sector Analysis

This award falls under Engineering Services (NAICS 541330), a sector often characterized by specialized expertise and long development cycles. Defense contracts in this area can be substantial, with benchmarks varying widely based on project complexity.

Small Business Impact

The awardee, Raytheon Company, is a large business. There is no indication that small businesses were involved in this specific contract action, nor is there a stated subcontracting plan.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny from oversight bodies to ensure fair pricing and program necessity. A review of the justification for other than full and open competition would be prudent.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award lacks competition
Cost-plus-fixed-fee contract type may inflate costs
Potential for higher taxpayer expense
Limited transparency in pricing
No indication of small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $6.5 million to RAYTHEON COMPANY. JMEWS LONG LEAD MATERIAL

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 $6.5 million.

What is the period of performance?

Start: 2025-11-26. End: 2027-04-28.

What is the specific justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair and reasonable pricing?

The justification for sole-source procurement is critical for understanding the necessity of avoiding full and open competition. Agencies must demonstrate that only one responsible source can satisfy the agency's needs. Without this justification, it's difficult to assess if the government received the best value. Fair and reasonable pricing is typically determined through cost analysis, market research, or comparison to similar contracts, but these processes are inherently limited in sole-source situations.

What are the potential risks associated with a cost-plus-fixed-fee contract for long-lead material, especially in a sole-source context?

Cost-plus-fixed-fee (CPFF) contracts carry inherent risks, particularly for long-lead material where unforeseen costs can arise. The contractor is reimbursed for allowable costs plus a fixed fee, creating less incentive to control costs compared to fixed-price contracts. In a sole-source scenario, the government lacks the leverage of competition to negotiate a more favorable fee or ensure aggressive cost management, potentially leading to higher overall expenditures.

How does this sole-source award impact the overall cost and schedule of the JMEWS program?

A sole-source award for critical long-lead material can introduce significant risks to both the cost and schedule of the JMEWS program. Without competitive pressure, the price for this material may be higher than if multiple vendors had bid. Furthermore, any delays or cost overruns experienced by the sole-source provider directly impact the program's timeline and budget, as there are no alternative suppliers readily available to mitigate these issues.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N6893623R0008

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 1151 E HERMANS RD, TUCSON, AZ, 85756

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: $6,470,259

Exercised Options: $6,470,259

Current Obligation: $6,470,259

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6893623D0042

IDV Type: IDC

Timeline