DoD's B-2 PDM contract awarded to Northrop Grumman for $116.9M, facing limited competition
Contract Overview
Contract Amount: $116,875,202 ($116.9M)
Contractor: Northrop Grumman Systems Corp
Awarding Agency: Department of Defense
Start Date: 2014-01-01
End Date: 2016-02-26
Contract Duration: 786 days
Daily Burn Rate: $148.7K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: IGF::OT::IGF B-2 PROGRAMMED DEPOT MAINTENANCE (PDM)
Place of Performance
Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93550
Plain-Language Summary
Department of Defense obligated $116.9 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: IGF::OT::IGF B-2 PROGRAMMED DEPOT MAINTENANCE (PDM) Key points: 1. High contract value of $116.9M for B-2 Programmed Depot Maintenance. 2. Sole incumbent contractor, Northrop Grumman, limits competitive pressure. 3. Potential risk associated with single-source provider for critical aircraft maintenance. 4. Spending falls within the Aircraft Manufacturing sector.
Value Assessment
Rating: fair
The contract value of $116.9M for B-2 PDM is substantial. Benchmarking against similar complex aircraft maintenance contracts is difficult without more specific scope details, but the lack of competition suggests potential for higher pricing than a competitive environment.
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 limits price discovery and potentially leads to higher costs for the government compared to a competitive bidding process.
Taxpayer Impact: The lack of competition on this significant contract may result in taxpayers paying a premium for B-2 depot maintenance services.
Public Impact
Ensures continued operational readiness of the B-2 bomber fleet. Supports critical defense capabilities and national security. Potential for cost overruns due to sole-source nature. Impacts the specialized aerospace maintenance workforce.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High contract value
Positive Signals
- Ensures critical maintenance for B-2 fleet
- Incumbent expertise
Sector Analysis
This contract falls under the Aircraft Manufacturing sector, specifically focusing on depot maintenance for a high-value, strategic asset. Spending benchmarks for such specialized, sole-source maintenance are difficult to establish due to unique program requirements and limited market availability.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corp, a large business. There is no indication of small business participation in this specific contract award, suggesting limited opportunities for small businesses in this particular maintenance effort.
Oversight & Accountability
Oversight of this sole-source contract is crucial to ensure fair pricing and performance. The Department of the Air Force is responsible for monitoring Northrop Grumman's execution and validating costs against the firm fixed price.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for cost creep without competitive pressure.
- Dependence on a single contractor for critical maintenance.
- Lack of transparency in pricing due to non-competitive nature.
Tags
aircraft-manufacturing, department-of-defense, ca, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $116.9 million to NORTHROP GRUMMAN SYSTEMS CORP. IGF::OT::IGF B-2 PROGRAMMED DEPOT MAINTENANCE (PDM)
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 $116.9 million.
What is the period of performance?
Start: 2014-01-01. End: 2016-02-26.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or the absence of adequate competition. For the B-2 PDM, it's likely tied to Northrop Grumman's deep knowledge and historical involvement with the platform. Exploring alternative strategies, such as phased competition or incentivizing new entrants, should be a continuous effort to mitigate long-term sole-source risks and costs.
How does the $116.9M contract value compare to historical B-2 PDM costs and industry benchmarks?
Direct comparison to historical B-2 PDM costs requires access to prior contract data. Industry benchmarks for depot maintenance on highly specialized, low-volume platforms like the B-2 are scarce. However, the absence of competition suggests this price may not reflect the lowest achievable cost. A thorough cost analysis by the Air Force is essential to validate the reasonableness of the $116.9M expenditure.
What mechanisms are in place to ensure the effectiveness and quality of the maintenance performed by Northrop Grumman?
Effectiveness and quality are typically ensured through stringent contract terms, performance metrics, and government quality assurance representatives. For this contract, the Air Force likely has detailed specifications and inspection protocols. Regular performance reviews and milestone tracking are critical to ensure the B-2 aircraft receive the necessary maintenance to remain mission-capable throughout the contract period.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
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: $213,015,540
Exercised Options: $213,015,540
Current Obligation: $116,875,202
Subaward Activity
Number of Subawards: 35
Total Subaward Amount: $8,871,332
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: 2014-01-01
Current End Date: 2016-02-26
Potential End Date: 2016-02-26 00:00:00
Last Modified: 2021-02-20
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