DoD Awards Raytheon $61.6M for Navigation Systems, Lacking Competition

Contract Overview

Contract Amount: $61,642,488 ($61.6M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2022-12-23

End Date: 2028-01-31

Contract Duration: 1,865 days

Daily Burn Rate: $33.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TAIWAN TA

Place of Performance

Location: MCKINNEY, COLLIN County, TEXAS, 75071

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $61.6 million to RAYTHEON COMPANY for work described as: TAIWAN TA Key points: 1. Significant contract value of $61.6 million awarded. 2. Sole-source award to Raytheon Company raises competition concerns. 3. Potential for higher costs due to lack of competitive bidding. 4. Contract supports critical navigation systems for defense.

Value Assessment

Rating: questionable

The contract value of $61.6 million for navigation systems appears substantial. Without competitive bids, it's difficult to benchmark against similar contracts to determine if the pricing is optimal.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning Raytheon was the only vendor considered. This significantly limits price discovery and potentially leads to higher costs for taxpayers.

Taxpayer Impact: The lack of competition in this sole-source award means taxpayers may not be receiving the best possible price for these navigation systems.

Public Impact

Ensures continued availability of critical navigation systems for military operations. Supports a major defense contractor, potentially impacting jobs and the supply chain. Raises questions about the government's procurement strategy for essential defense equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Long contract duration (2028)

Positive Signals

Supports critical defense capability
Award to established contractor

Sector Analysis

The defense sector often involves complex, specialized equipment where sole-source contracts can sometimes be justified due to unique capabilities. However, the benchmark for such awards should still be competitive pricing where feasible.

Small Business Impact

This contract was not awarded to a small business. Analysis of subcontracting opportunities for small businesses is not available from the provided data.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the government obtained fair value and that competition was appropriately considered.

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 procurement
Potential for inflated pricing
Limited transparency in price negotiation
Long-term commitment without competitive validation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $61.6 million to RAYTHEON COMPANY. TAIWAN TA

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 $61.6 million.

What is the period of performance?

Start: 2022-12-23. End: 2028-01-31.

What is the justification for awarding this contract on a sole-source basis to Raytheon Company?

The justification for a sole-source award typically involves unique capabilities, proprietary technology, or a lack of viable alternatives. Without further details, it's impossible to confirm if these criteria were met. The Defense Logistics Agency should provide documentation outlining the specific reasons why competition was not pursued for these navigation systems.

What is the potential cost impact of this sole-source award compared to a competitive process?

Sole-source contracts often result in higher costs for the government because there is no competitive pressure to drive down prices. While the exact difference is unknown without a benchmark, studies suggest sole-source awards can be 10-30% more expensive than if the contract had been competed. This could translate to millions in additional taxpayer expense.

How does this contract contribute to the overall effectiveness of the Department of Defense's navigation capabilities?

This contract ensures the continued supply and maintenance of essential search, detection, navigation, guidance, and related systems. By awarding it to Raytheon, the DoD maintains a relationship with a key supplier, presumably ensuring the operational readiness and effectiveness of aircraft and vessels relying on these instruments.

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: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

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: $61,642,488

Exercised Options: $61,642,488

Current Obligation: $61,642,488

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