L3Harris Technologies awarded $21.7M for Sonobouy Rotary Launchers, a sole-source contract

Contract Overview

Contract Amount: $21,685,177 ($21.7M)

Contractor: L3harris Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2020-09-18

End Date: 2024-12-16

Contract Duration: 1,550 days

Daily Burn Rate: $14.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SONOBUOY ROTARY LAU

Place of Performance

Location: AMITYVILLE, SUFFOLK County, NEW YORK, 11701

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $21.7 million to L3HARRIS TECHNOLOGIES, INC. for work described as: SONOBUOY ROTARY LAU Key points: 1. Contract awarded on a sole-source basis, limiting competitive pricing benefits. 2. Long contract duration of 1550 days suggests a sustained need for the product. 3. Firm Fixed Price contract type shifts cost risk to the contractor. 4. No small business set-aside indicates potential for large prime contractor benefits. 5. Contract falls under 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code. 6. Awarded by the Department of Defense, highlighting defense sector spending.

Value Assessment

Rating: fair

Benchmarking the value of this sole-source contract is challenging without competitive bids. The total award amount of $21.7 million over approximately four years suggests a significant investment in specialized defense equipment. Without comparable contracts or market data, assessing whether this represents excellent value for money is difficult. The firm fixed-price structure, however, provides cost certainty for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities, technology, or when urgency dictates. The lack of competition means the government did not benefit from price discovery through a bidding process, potentially leading to higher costs than if multiple firms had competed.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. The government's ability to negotiate the best possible price was limited by the sole-source nature of this award.

Public Impact

The primary beneficiary is the Department of Defense, which receives critical sonobuoy launch systems. This contract supports naval operations and maritime surveillance capabilities. The geographic impact is likely global, supporting naval deployments wherever sonobuoys are utilized. Workforce implications include skilled manufacturing and engineering roles at L3Harris Technologies.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Long contract duration could mask inefficiencies if not closely monitored.
Lack of small business involvement may limit broader economic impact.

Positive Signals

Firm Fixed Price contract provides cost certainty for the government.
Award to an established defense contractor suggests a focus on reliable delivery.
Contract supports critical defense capabilities for the Department of Defense.

Sector Analysis

The defense manufacturing sector, particularly for specialized naval equipment like sonobuoys, is characterized by high barriers to entry and significant R&D investment. Contracts in this space often involve complex technologies and stringent performance requirements. L3Harris Technologies is a major player in defense electronics and systems. Spending on similar naval systems and components can range from millions to billions, depending on the scale and sophistication of the equipment.

Small Business Impact

This contract was not set aside for small businesses, and the prime contractor is L3Harris Technologies, a large corporation. There is no indication of specific subcontracting requirements for small businesses within the provided data. This means the primary economic benefits will flow to the large prime contractor, with limited direct opportunities for small businesses unless they are already part of L3Harris's established supply chain.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. As a definitive contract, it is subject to standard government oversight procedures. Transparency is generally maintained through contract databases, but detailed performance metrics and cost breakdowns may not be publicly available. Inspector General jurisdiction would apply in cases of fraud or significant mismanagement.

Related Government Programs

Naval Warfare Systems
Maritime Surveillance Equipment
Defense Electronics Manufacturing
Sonobuoy Systems
Aircraft Parts Manufacturing

Risk Flags

Sole-source award
Long contract duration
Lack of small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.7 million to L3HARRIS TECHNOLOGIES, INC.. SONOBUOY ROTARY LAU

Who is the contractor on this award?

The obligated recipient is L3HARRIS TECHNOLOGIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $21.7 million.

What is the period of performance?

Start: 2020-09-18. End: 2024-12-16.

What is the track record of L3Harris Technologies with similar defense contracts?

L3Harris Technologies has a substantial track record with the Department of Defense, frequently securing large contracts for a wide array of defense systems, electronics, and communication equipment. They are a well-established prime contractor known for producing complex military hardware. While specific performance details for every contract are not always public, their consistent role as a major defense supplier suggests a generally reliable performance history. However, like any large contractor, they may have faced scrutiny or performance issues on specific programs, which would typically be managed through contract modifications, performance improvement plans, or other contractual remedies by the contracting agency.

How does the pricing of this contract compare to similar sonobuoy launcher contracts?

Direct price comparison for this specific 'Sonobouy Rotary Launcher' contract is difficult due to its sole-source nature and the specialized equipment involved. Without competitive bids, it's hard to establish a market-driven price benchmark. Generally, sole-source contracts tend to be more expensive than competitively awarded ones because the government lacks the leverage of multiple bidders driving down costs. To assess value, one would need to compare the unit cost (if calculable and provided) against internal cost estimates, historical pricing for similar, though not identical, components, or data from other government agencies procuring related systems. The firm fixed-price structure does offer cost certainty, but the initial price point remains unvalidated by competition.

What are the primary risks associated with this contract for the government?

The primary risk for the government in this contract is the lack of competitive pricing due to its sole-source award, potentially leading to overpayment. Another risk is contractor performance; while L3Harris is a large company, any delays, quality issues, or cost overruns (though mitigated by FFP) could impact naval readiness. The long duration (1550 days) also presents a risk of technological obsolescence if the sonobuoy technology evolves rapidly. Furthermore, reliance on a single source can create supply chain vulnerabilities if L3Harris faces production challenges.

How effective is the Department of Defense in managing sole-source contracts of this nature?

The Department of Defense (DoD) has established policies and procedures for managing sole-source contracts, often requiring justification and approval processes to ensure they are only used when truly necessary. Agencies like the Defense Contract Management Agency (DCMA) provide oversight. Effectiveness can vary depending on the specific program, the level of competition that was genuinely explored, and the diligence of the contracting officers and program managers. While the DoD aims for efficiency and value, sole-source awards inherently carry a higher risk of suboptimal pricing compared to competitive procurements. Robust negotiation and ongoing performance monitoring are crucial for mitigating these risks.

What are the historical spending patterns for sonobuoy-related equipment by the DoD?

Historical spending patterns for sonobuoy-related equipment by the DoD are substantial, reflecting the critical role these systems play in naval operations and intelligence gathering. Sonobuoys are expendable devices deployed from aircraft or ships to detect submarines and other underwater acoustic signals. The DoD consistently procures large quantities of various types of sonobuoys and associated deployment and processing systems. Annual spending can fluctuate based on operational tempo, fleet modernization programs, and specific threats, often running into hundreds of millions of dollars across different branches and programs. This specific contract for rotary launchers represents a component within that broader spending category.

What is the significance of the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code?

The NAICS code 336413, 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' signifies that the primary business activity related to this contract involves the production of parts and auxiliary equipment for aircraft, which are not elsewhere classified. In the context of sonobuoys, which are often deployed from aircraft (like maritime patrol aircraft), this classification makes sense as the launchers and potentially the sonobuoys themselves can be considered auxiliary equipment for the aircraft's mission systems. This code places the contract within a specific segment of the aerospace and defense manufacturing industry, allowing for industry-specific analysis and benchmarking.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: SPRPA119RV532

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 1500 NEW HORIZONS BLVD, AMITYVILLE, NY, 11701

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: $21,685,177

Exercised Options: $21,685,177

Current Obligation: $21,685,177

Subaward Activity

Number of Subawards: 23

Total Subaward Amount: $9,056,099

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline