DoD Awards Raytheon $62M for Navigation Systems, Facing Limited Competition
Contract Overview
Contract Amount: $62,012,158 ($62.0M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2023-08-21
End Date: 2028-07-31
Contract Duration: 1,806 days
Daily Burn Rate: $34.3K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: CLIN FUNDING
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $62.0 million to RAYTHEON COMPANY for work described as: CLIN FUNDING Key points: 1. Significant contract value of over $62 million awarded to a major defense contractor. 2. Limited competition raises questions about price discovery and potential cost efficiencies. 3. Contract duration of nearly five years suggests a long-term need for these systems. 4. The sector is critical for defense operations, impacting national security.
Value Assessment
Rating: fair
The contract type is Cost Plus Fixed Fee, which can lead to higher costs if not managed carefully. Without a competitive benchmark, it's difficult to assess if the fixed fee is reasonable for the effort required.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not competed, indicating potential limitations in the procurement process. This lack of competition may have resulted in a higher price than could have been achieved through a more open bidding process.
Taxpayer Impact: The absence of robust competition could lead to taxpayers paying more than necessary for these essential navigation systems.
Public Impact
Ensures continued operational capability for critical defense navigation systems. Supports a major defense contractor and its supply chain. Potential for cost overruns due to contract type and limited competition.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Cost Plus Fixed Fee contract type
- Long contract duration
Positive Signals
- Ensures availability of critical defense systems
- Supports established contractor with relevant expertise
Sector Analysis
This contract falls within the Defense sector, specifically focusing on navigation and guidance systems. Spending in this area is crucial for military readiness, and benchmarks often reflect high R&D and specialized manufacturing costs.
Small Business Impact
The data indicates this contract was awarded to Raytheon Company, a large prime contractor. There is no explicit information suggesting subcontracting opportunities for small businesses within this specific award, which is common for large defense contracts.
Oversight & Accountability
The contract is managed by the Defense Logistics Agency, a key component of DoD oversight. However, the limited competition aspect warrants closer scrutiny to ensure accountability and prevent potential waste.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Lack of competitive bidding
- Potential for cost creep with CPFF contract
- Long-term reliance on a single source
- Limited transparency on pricing justification
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 $62.0 million to RAYTHEON COMPANY. CLIN FUNDING
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 $62.0 million.
What is the period of performance?
Start: 2023-08-21. End: 2028-07-31.
What specific factors justified the limited competition for this critical navigation system procurement?
The justification for limited competition typically involves factors such as unique technical requirements, urgent needs, or the unavailability of other sources capable of meeting the specifications. A thorough review of the contract's justification for other than full and open competition (JOFOC) would be necessary to understand the specific rationale and assess its validity.
How will the Cost Plus Fixed Fee structure be monitored to prevent cost overruns?
Monitoring a Cost Plus Fixed Fee (CPFF) contract involves rigorous oversight of incurred costs and the contractor's performance against the fixed fee. Agencies use Earned Value Management (EVM) and regular audits to track spending, ensure efficiency, and verify that the fixed fee remains appropriate for the work accomplished, mitigating the risk of excessive costs.
What is the long-term strategic value of these navigation systems to the DoD?
These navigation systems are fundamental to the operational effectiveness of various military platforms, including aircraft and naval vessels. Their strategic value lies in ensuring precise positioning, guidance, and situational awareness, which are critical for mission success, force protection, and maintaining a technological advantage in complex operational environments.
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: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp
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: $62,012,158
Exercised Options: $62,012,158
Current Obligation: $62,012,158
Subaward Activity
Number of Subawards: 40
Total Subaward Amount: $4,162,028
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: 2023-08-21
Current End Date: 2028-07-31
Potential End Date: 2028-07-31 12:07:00
Last Modified: 2025-10-21
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