DoD awards $76.8M for TOW ITAS spares to Raytheon Company, with no competition
Contract Overview
Contract Amount: $76,808,775 ($76.8M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2020-05-20
End Date: 2024-08-21
Contract Duration: 1,554 days
Daily Burn Rate: $49.4K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: SPARES FOR THE TUBE-LAUNCHED OPTICALLY-TRACKED WIRE-GUIDED (TOW) IMPROVED TARGET ACQUISITION SYSTEM (ITAS)
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $76.8 million to RAYTHEON COMPANY for work described as: SPARES FOR THE TUBE-LAUNCHED OPTICALLY-TRACKED WIRE-GUIDED (TOW) IMPROVED TARGET ACQUISITION SYSTEM (ITAS) Key points: 1. Significant contract value for specialized defense system components. 2. Sole-source award to Raytheon Company, the incumbent manufacturer. 3. Potential for higher costs due to lack of competitive bidding. 4. Focus on maintaining critical targeting system readiness.
Value Assessment
Rating: fair
The contract value of $76.8M for spares is substantial. Without competitive benchmarking, it's difficult to assess if this price is optimal compared to potential alternatives or previous pricing.
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 leads to higher costs for taxpayers as competition is absent.
Taxpayer Impact: The lack of competition for these critical spares may result in higher expenditure of taxpayer funds than if multiple vendors were considered.
Public Impact
Ensures continued operational readiness of the TOW ITAS missile system. Supports military targeting capabilities for ground forces. Potential impact on defense budget allocation due to sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
Positive Signals
- Ensures availability of critical spares
- Supports existing defense systems
Sector Analysis
This contract falls under the defense manufacturing sector, specifically for targeting and guidance systems. Spending benchmarks for such specialized components are often high due to R&D and proprietary technology.
Small Business Impact
There is no indication that small businesses were involved in this specific contract award. The sole-source nature likely limited opportunities for subcontracting to smaller enterprises.
Oversight & Accountability
The Department of Defense, through the Defense Logistics Agency, is responsible for this procurement. Oversight would focus on ensuring Raytheon meets delivery schedules and quality standards for the spares.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award
- Lack of competitive bidding
- Potential for price escalation
- Dependence on a single supplier
Tags
search-detection-navigation-guidance-aer, department-of-defense, ma, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $76.8 million to RAYTHEON COMPANY. SPARES FOR THE TUBE-LAUNCHED OPTICALLY-TRACKED WIRE-GUIDED (TOW) IMPROVED TARGET ACQUISITION SYSTEM (ITAS)
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $76.8 million.
What is the period of performance?
Start: 2020-05-20. End: 2024-08-21.
What is the historical pricing trend for these spares, and how does the current award compare?
Historical pricing data for these specific spares is not provided. A comprehensive analysis would require access to previous contract awards for the same or similar components from Raytheon and potentially other manufacturers, if available, to establish a baseline and identify any significant price escalations or deviations.
What are the risks associated with relying solely on Raytheon for these critical spares?
The primary risk is the lack of competitive pressure, which can lead to inflated prices and reduced innovation. Additionally, dependence on a single supplier creates vulnerability if Raytheon faces production issues, supply chain disruptions, or decides to discontinue the product line, potentially impacting military readiness.
How does the availability of these spares impact the overall effectiveness of the TOW ITAS system?
The availability of these spares is crucial for maintaining the operational readiness and effectiveness of the TOW ITAS. Without adequate spare parts, the system could become inoperable, directly hindering the military's ability to perform its targeting and engagement missions, thereby reducing overall combat effectiveness.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: WEAPONS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
Address: 350 LOWELL ST, ANDOVER, MA, 01810
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: $76,808,775
Exercised Options: $76,808,775
Current Obligation: $76,808,775
Subaward Activity
Number of Subawards: 19
Total Subaward Amount: $4,728,618
Contract Characteristics
Consolidated Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPRBL115D0017
IDV Type: IDC
Timeline
Start Date: 2020-05-20
Current End Date: 2024-08-21
Potential End Date: 2024-08-21 12:08:00
Last Modified: 2025-05-27
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