Raytheon Company awarded $44.2M for Circuit Card and Gimbal Assemblies by the Department of Defense

Contract Overview

Contract Amount: $44,200,435 ($44.2M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2023-09-21

End Date: 2026-03-31

Contract Duration: 922 days

Daily Burn Rate: $47.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CIRCUIT CARD ASSEMBLY 5998-01-570-0287 GIMBAL ASSEMBLY 1005-01-535-3488

Place of Performance

Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $44.2 million to RAYTHEON COMPANY for work described as: CIRCUIT CARD ASSEMBLY 5998-01-570-0287 GIMBAL ASSEMBLY 1005-01-535-3488 Key points: 1. Contract value of $44.2 million for critical defense components. 2. Awarded to a single, established defense contractor, Raytheon Company. 3. Potential for higher costs due to a sole-source procurement approach. 4. Long-term contract duration of over two years indicates sustained need. 5. Focus on navigation and guidance systems highlights strategic importance. 6. No small business set-aside, potentially limiting broader economic participation.

Value Assessment

Rating: fair

The contract value of $44.2 million for circuit card and gimbal assemblies appears substantial. Benchmarking against similar sole-source procurements for specialized defense components is challenging without more detailed specifications. However, the absence of competition suggests a potential risk of paying a premium compared to a more open market. The firm-fixed-price structure provides cost certainty for the government, but the overall value proposition hinges on the necessity of this specific supplier and the negotiated price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning Raytheon Company was the only bidder. This approach is typically used when a specific technology or capability is only available from one source, or for urgent requirements where competition is not feasible. The lack of competition limits the government's ability to explore alternative solutions or leverage market forces to achieve lower prices.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. This necessitates strong government oversight to ensure fair pricing.

Public Impact

The Department of Defense benefits from the supply of essential components for its defense systems. These circuit card and gimbal assemblies are critical for the functionality of search, detection, navigation, guidance, aeronautical, and nautical systems. The contract supports national security by ensuring the availability of key defense hardware. The geographic impact is primarily within the defense supply chain, with potential downstream effects on military readiness.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially increases costs for taxpayers.
Lack of transparency in the sole-source justification could obscure potential alternatives.
Long contract duration may not account for technological advancements that could offer better solutions.
No small business participation noted, potentially missing opportunities for innovation and economic inclusion.

Positive Signals

Award to a known entity, Raytheon Company, suggests a level of established capability and reliability.
Firm-fixed-price contract provides cost predictability for the government.
Contract addresses a clear need for critical defense system components.
Long-term nature of the contract ensures supply chain stability for essential parts.

Sector Analysis

The contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector, classified under NAICS code 334511. This is a specialized segment of the aerospace and defense industry focused on high-technology instrumentation. The market is characterized by high barriers to entry, significant R&D investment, and a primary customer base of government defense agencies. Spending in this sector is driven by defense modernization efforts and operational requirements.

Small Business Impact

This contract does not appear to include a small business set-aside. The award to Raytheon Company, a large defense contractor, suggests that subcontracting opportunities for small businesses may exist, but this is not guaranteed. The absence of a specific set-aside means that small businesses did not have a direct opportunity to compete for the prime contract, potentially limiting their direct engagement with this specific procurement.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations. The Defense Contract Management Agency (DCMA) likely plays a role in monitoring performance and compliance. Transparency is limited due to the sole-source nature, but contract awards are generally reported. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Logistics Agency Procurement
Navigation System Components
Guidance System Components
Aerospace and Defense Manufacturing
Sole-Source Defense Contracts

Risk Flags

Sole-source award may lead to higher costs.
Lack of competition limits price discovery.
Potential for vendor lock-in.
No explicit small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.2 million to RAYTHEON COMPANY. CIRCUIT CARD ASSEMBLY 5998-01-570-0287 GIMBAL ASSEMBLY 1005-01-535-3488

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 $44.2 million.

What is the period of performance?

Start: 2023-09-21. End: 2026-03-31.

What is the specific justification for the sole-source award to Raytheon Company for these circuit card and gimbal assemblies?

The provided data indicates the contract was 'NOT COMPETED,' signifying a sole-source award. The specific justification for this approach is not detailed in the provided data. Typically, sole-source awards are made when only one responsible source can provide the required supplies or services, such as when a unique technology, proprietary design, or urgent need exists that cannot be met through competitive means. Without further documentation from the awarding agency (Department of Defense, via Defense Logistics Agency), the precise rationale remains unknown. This could be due to proprietary technology, specialized manufacturing capabilities, or critical interoperability requirements that only Raytheon can fulfill for these specific circuit card and gimbal assemblies.

How does the $44.2 million contract value compare to historical spending on similar components by the Department of Defense?

Direct comparison of the $44.2 million contract value to historical spending on identical or highly similar circuit card and gimbal assemblies is difficult without more granular data on specific part numbers, quantities, and the scope of work in past contracts. The provided data includes a 'br' (benchmark rate) of 47940, which might represent a unit price or a related benchmark, but its context is unclear. Given the sole-source nature, it's plausible that this value reflects a negotiated price for specialized components rather than a price driven by competitive bidding. Historical data from the Defense Logistics Agency or other DoD branches for comparable sole-source awards would be needed for a robust comparison, but such data is not readily available in the provided snippet.

What are the primary risks associated with this sole-source contract for the Department of Defense?

The primary risk associated with this sole-source contract is the potential for inflated pricing due to the lack of competition. Without competing bids, the government may not achieve the best possible price for the circuit card and gimbal assemblies. Another risk is vendor lock-in, where the DoD becomes dependent on Raytheon for these specific components, potentially limiting future flexibility or access to alternative technologies. There's also a risk related to performance if Raytheon faces production issues or delays, as there are no immediate alternative suppliers. Finally, the justification for the sole-source award itself could be scrutinized if it was not adequately documented or if alternative solutions were overlooked.

What is the expected impact of these circuit card and gimbal assemblies on the performance of the defense systems they are integrated into?

Circuit cards and gimbal assemblies are fundamental components in many sophisticated defense systems. Circuit cards often house the electronic brains and control systems, processing data and executing commands. Gimbal assemblies are typically used for stabilization, aiming, or tracking, allowing systems like radar, targeting pods, or communication antennas to maintain orientation or follow targets accurately. Therefore, the quality, reliability, and performance of these specific assemblies directly impact the overall effectiveness, precision, and operational capability of the defense systems they are part of, such as search, detection, navigation, and guidance equipment.

Are there any performance metrics or key performance indicators (KPIs) associated with this contract that are publicly available?

The provided data snippet does not include specific performance metrics or Key Performance Indicators (KPIs) for this contract. Typically, such details are outlined in the contract's statement of work (SOW) or performance work statement (PWS). These metrics often relate to delivery timelines, quality standards (e.g., defect rates), reliability, and adherence to technical specifications. While the contract is firm-fixed-price, which implies a focus on delivering the specified goods, the specific measures used to evaluate Raytheon's performance are not publicly detailed in this summary. Government contract databases or agency procurement portals might contain more detailed information if publicly releasable.

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: 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: $44,200,435

Exercised Options: $44,200,435

Current Obligation: $44,200,435

Subaward Activity

Number of Subawards: 26

Total Subaward Amount: $30,354,192

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