DoD awards $31.9M for RF amplifiers, with L3 Technologies Inc. securing the contract

Contract Overview

Contract Amount: $31,958,749 ($32.0M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-03-28

End Date: 2028-01-28

Contract Duration: 1,401 days

Daily Burn Rate: $22.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: NSN: 5996-01-520-9570 COMMODITY NAME: AMPLIFIER,RADIO FREQUENCY SYSTEM: PHOENIX (AN/TSC-156)

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84116

State: Utah Government Spending

Plain-Language Summary

Department of Defense obligated $32.0 million to L3 TECHNOLOGIES, INC. for work described as: NSN: 5996-01-520-9570 COMMODITY NAME: AMPLIFIER,RADIO FREQUENCY SYSTEM: PHOENIX (AN/TSC-156) Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1401 days indicates a long-term need for these components. 3. The fixed-price contract type aims to control costs for the government. 4. The award is for amplifier components for the PHOENIX (AN/TSC-156) system. 5. The supplier, L3 Technologies, Inc., is a significant player in the defense sector. 6. The contract value is substantial, reflecting the critical nature of the components.

Value Assessment

Rating: good

The contract value of $31.9 million for radio frequency amplifiers appears reasonable given the long-term duration and the specialized nature of the components for the PHOENIX system. Benchmarking against similar contracts for electronic components of this complexity is challenging without more specific technical details. However, the firm fixed-price structure suggests an effort to establish a predictable cost for the government over the contract period. The number of bids received (3) provides some indication of market interest, but a higher number would typically suggest stronger price competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. Three bids were received, indicating a moderate level of competition for this specific requirement. While three bidders suggest some level of market engagement, a higher number of competitors could potentially drive prices lower and offer a wider range of technical solutions. The agency's decision to use full and open competition is generally a positive sign for achieving fair market prices.

Taxpayer Impact: Full and open competition, even with a limited number of bidders, generally benefits taxpayers by ensuring that the government has explored the market and is likely to receive competitive pricing. This approach helps prevent inflated costs that can occur with less competitive solicitations.

Public Impact

The Department of Defense benefits from the reliable supply of critical radio frequency amplifiers. The PHOENIX (AN/TSC-156) system, which utilizes these amplifiers, is likely a key communication or electronic warfare platform. The contract supports the operational readiness and technological capabilities of the U.S. military. The geographic impact is primarily within the defense supply chain and potentially at military installations where the PHOENIX system is deployed. Workforce implications are likely within L3 Technologies, Inc. and its subcontractors, supporting manufacturing and engineering roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions if L3 Technologies, Inc. faces production issues.
Long-term contract duration could lead to price increases if market conditions change significantly.
Dependence on a single contractor for a critical component could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
Firm fixed-price contract type helps manage cost certainty for the government.
L3 Technologies, Inc. is an established defense contractor with a track record.
The contract duration aligns with the expected lifecycle of the PHOENIX system.

Sector Analysis

This contract falls within the Electronic Components Manufacturing sector, specifically focusing on radio frequency (RF) amplifiers. This is a specialized niche within the broader electronics industry, critical for defense applications such as radar, electronic warfare, and secure communications. The market for such components is often characterized by high barriers to entry due to technical expertise, stringent quality requirements, and long development cycles. Comparable spending benchmarks are difficult to ascertain without detailed specifications, but defense contracts for advanced electronic components can range from millions to hundreds of millions of dollars.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). The prime contractor, L3 Technologies, Inc., is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear, though large defense contracts often involve a tiered subcontracting structure where small businesses may participate.

Oversight & Accountability

The Department of Defense, through the Defense Logistics Agency, is responsible for overseeing this contract. Oversight mechanisms would typically include contract administration, performance monitoring, and quality assurance to ensure compliance with the terms and specifications. Accountability is maintained through the firm fixed-price contract structure, which incentivizes the contractor to meet delivery schedules and quality standards. Transparency is facilitated by the contract award data being publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Defense Logistics Agency Procurement
Radio Frequency Component Procurement
Electronic Warfare Systems Support
AN/TSC-156 PHOENIX System Components
Department of Defense Electronics Manufacturing

Risk Flags

Long-term contract duration may expose government to price fluctuations if market conditions change.
Dependence on a single supplier for critical components can create supply chain vulnerabilities.
Potential for technological obsolescence over the contract's extended period.
Limited number of bidders (3) may indicate a niche market or barriers to entry.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.0 million to L3 TECHNOLOGIES, INC.. NSN: 5996-01-520-9570 COMMODITY NAME: AMPLIFIER,RADIO FREQUENCY SYSTEM: PHOENIX (AN/TSC-156)

Who is the contractor on this award?

The obligated recipient is L3 TECHNOLOGIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $32.0 million.

What is the period of performance?

Start: 2024-03-28. End: 2028-01-28.

What is the specific technical role of these RF amplifiers within the PHOENIX (AN/TSC-156) system?

The PHOENIX (AN/TSC-156) is a tactical satellite communications system. Radio Frequency (RF) amplifiers are critical components within such systems, responsible for increasing the power of radio signals. In the context of the PHOENIX system, these amplifiers would likely be used in the transmit and receive chains to ensure that signals are strong enough to be sent over long distances via satellite and to be reliably detected upon reception. The specific type and performance characteristics of the amplifiers (e.g., frequency range, power output, gain, noise figure) are crucial for the overall performance, reliability, and range of the satellite communication system.

How does the awarded price of $31.9 million compare to historical spending on similar RF amplifiers by the DoD?

Direct historical spending comparisons for this specific NSN (5996-01-520-9570) and commodity name ('AMPLIFIER, RADIO FREQUENCY') are not readily available in the provided data snippet. However, the contract value of $31.9 million over approximately 3.7 years (1401 days) suggests an average annual spend of roughly $8.6 million. The price per unit is not provided, making direct benchmarking difficult. The Defense Logistics Agency (DLA) procures a vast array of electronic components, and the cost of RF amplifiers can vary significantly based on frequency, power, linearity, and environmental ruggedness required for military applications. Without more granular data on unit quantities and specific technical requirements, a precise historical comparison is challenging.

What are the key performance indicators (KPIs) used to evaluate L3 Technologies, Inc.'s performance under this contract?

Specific Key Performance Indicators (KPIs) for this contract are not detailed in the provided award data. However, typical KPIs for defense contracts involving electronic components would likely include: On-Time Delivery Rate (ensuring components are delivered by the scheduled dates), Quality Acceptance Rate (percentage of delivered units passing inspection and testing without defects), Technical Performance (meeting or exceeding specified technical parameters like gain, power output, and signal integrity), and Compliance with Contractual Terms (adherence to reporting requirements, documentation, and other contractual obligations). The firm fixed-price nature also implies that meeting cost targets is implicitly a KPI.

What is the potential risk associated with the long contract duration (1401 days)?

The long contract duration of 1401 days (approximately 3.85 years) presents several potential risks. Firstly, there's a risk of price escalation if market conditions for raw materials or manufacturing labor change unfavorably over the contract period, although the firm fixed-price structure aims to mitigate this for the government. Secondly, technological obsolescence is a concern; while the PHOENIX system may still be current, advancements in RF amplifier technology could emerge during this period, potentially making the procured components less cutting-edge. Thirdly, contractor performance stability over an extended period can be a risk; unforeseen financial difficulties or shifts in strategic focus for L3 Technologies, Inc. could impact their ability to consistently deliver. Finally, maintaining consistent quality control and supply chain integrity over such a long duration requires diligent oversight.

Given that this is a full and open competition with 3 bidders, what does this imply about the market for these specific RF amplifiers?

A full and open competition with three bidders suggests a moderately competitive market for these specific RF amplifiers. It indicates that the Defense Logistics Agency actively sought out potential suppliers and that at least three companies possessed the capability and interest to bid. However, a higher number of bidders (e.g., five or more) would typically signal a more robust and competitive market, potentially leading to more aggressive pricing and innovation. The fact that only three bids were received could imply that the market for these highly specialized military-grade RF amplifiers is relatively niche, with a limited number of qualified manufacturers capable of meeting the stringent technical and quality requirements, or that the contract terms themselves may have deterred additional bidders.

Industry Classification

NAICS: Manufacturing › Semiconductor and Other Electronic Component Manufacturing › Other Electronic Component Manufacturing

Product/Service Code: ELECTRICAL/ELECTRONIC EQPT COMPNTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 640 N 2200 W, SALT LAKE CITY, UT, 84116

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: $31,958,749

Exercised Options: $31,958,749

Current Obligation: $31,958,749

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $24,703,097

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPRBL123D0008

IDV Type: IDC

Timeline