DoD's $39M B-2 TACAN F3 contract awarded to Northrop Grumman without competition
Contract Overview
Contract Amount: $39,149,393 ($39.1M)
Contractor: Northrop Grumman Systems Corp
Awarding Agency: Department of Defense
Start Date: 2014-02-20
End Date: 2019-06-26
Contract Duration: 1,952 days
Daily Burn Rate: $20.1K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: B-2 TACTICAL AIR NAVIGATION FIT, FORM, FUNCTION (TACAN F3)
Place of Performance
Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93550
Plain-Language Summary
Department of Defense obligated $39.1 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: B-2 TACTICAL AIR NAVIGATION FIT, FORM, FUNCTION (TACAN F3) Key points: 1. Significant spending on a specialized aircraft component. 2. Sole-source award to Northrop Grumman raises competition concerns. 3. Long contract duration (1952 days) may indicate potential for cost overruns. 4. Aircraft Manufacturing sector is critical for defense readiness.
Value Assessment
Rating: questionable
The contract type is Cost Plus Incentive Fee, which can lead to higher costs if not managed closely. Without competitive bidding, it's difficult to assess if the $39.15M price represents fair value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Northrop Grumman. This lack of competition limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The absence of competition likely resulted in a higher price than a competed contract, impacting taxpayer funds negatively.
Public Impact
Impacts the operational readiness of the B-2 bomber fleet. Potential for increased costs due to lack of competitive pressure. Highlights reliance on a single contractor for critical components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Supports critical defense asset (B-2 bomber)
- Long-term sustainment of aging aircraft
Sector Analysis
This contract falls within the Aircraft Manufacturing sector, which is vital for national defense. Spending benchmarks for such specialized components are often high due to R&D and unique requirements, but competition is key to controlling costs.
Small Business Impact
The data indicates this contract was awarded to Northrop Grumman, a large corporation. There is no indication of small business participation in this specific award, suggesting missed opportunities for SMBs.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny regarding the justification for not competing. Further oversight is needed to ensure the cost-plus contract terms are managed effectively to prevent waste.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency
- Sole-source dependency
Tags
aircraft-manufacturing, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $39.1 million to NORTHROP GRUMMAN SYSTEMS CORP. B-2 TACTICAL AIR NAVIGATION FIT, FORM, FUNCTION (TACAN F3)
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $39.1 million.
What is the period of performance?
Start: 2014-02-20. End: 2019-06-26.
What was the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. Without specific documentation, it's presumed the Air Force determined Northrop Grumman was the only viable option for the B-2 TACAN F3 system, potentially due to specialized knowledge or integration requirements with the existing B-2 platform.
How does the cost-plus incentive fee structure impact the final price and taxpayer risk in this contract?
A Cost Plus Incentive Fee (CPIF) contract allows the contractor to recover costs plus a fee that is adjusted based on performance against targets (e.g., cost, schedule, performance). While it incentivizes efficiency, it also shifts some risk to the government if targets are missed or costs escalate beyond initial estimates. Taxpayers bear the risk of higher-than-expected costs if the contractor doesn't meet performance incentives effectively.
What is the long-term strategic implication of relying on a single supplier for critical B-2 components like the TACAN F3?
Long-term reliance on a single supplier can create strategic vulnerabilities. It can lead to price escalation over time, reduced innovation, and potential supply chain disruptions if the sole source faces financial or operational issues. Maintaining a competitive landscape or developing alternative sources is crucial for long-term defense readiness and cost control.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: INSTRUMENTS AND LABORATORY EQPT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 3520 E AVE M, PALMDALE, CA, 93550
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $39,149,393
Exercised Options: $39,149,393
Current Obligation: $39,149,393
Subaward Activity
Number of Subawards: 19
Total Subaward Amount: $386,219,593
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: F3365799D0028
IDV Type: IDC
Timeline
Start Date: 2014-02-20
Current End Date: 2019-06-26
Potential End Date: 2019-06-26 00:00:00
Last Modified: 2025-04-23
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