DoD Awards Northrop Grumman $54M for Aircraft Parts, Lacking Competition
Contract Overview
Contract Amount: $53,969,072 ($54.0M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2021-12-13
End Date: 2024-07-12
Contract Duration: 942 days
Daily Burn Rate: $57.3K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: TRANSMITTER,COUNTER
Place of Performance
Location: ROLLING MEADOWS, COOK County, ILLINOIS, 60008
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $54.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: TRANSMITTER,COUNTER Key points: 1. Significant contract value awarded to a single large defense contractor. 2. Lack of competition raises concerns about potential overpricing and reduced innovation. 3. The contract duration extends over two years, indicating a sustained need. 4. The sector is Other Aircraft Parts and Auxiliary Equipment Manufacturing.
Value Assessment
Rating: questionable
The contract value of $53.9M for aircraft parts is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to market rates or similar sole-source procurements.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and may lead to higher costs for taxpayers as the contractor faces no direct competitive pressure.
Taxpayer Impact: The lack of competition on this $54M contract means taxpayers may be paying a premium for these aircraft parts.
Public Impact
Taxpayers may be overpaying for essential aircraft components due to the absence of competitive bidding. The reliance on a single contractor for critical parts could pose supply chain risks. Future procurements in this category may continue to be non-competitive if not actively managed.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
- Long contract duration
Positive Signals
- Awarded to a known defense contractor
- Addresses a clear need for aircraft parts
Sector Analysis
This contract falls within the Other Aircraft Parts and Auxiliary Equipment Manufacturing sector, which is crucial for maintaining military aviation readiness. Spending in this area is often substantial, but competitive practices are vital to ensure value.
Small Business Impact
This contract was awarded to Northrop Grumman Systems Corporation, a large prime contractor. There is no indication that small businesses were involved as subcontractors or prime contractors in this specific award.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the price paid is fair and reasonable, and to explore opportunities for future competition.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Lack of competition
- Potential for price gouging
- Supply chain dependency
- Limited transparency
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, il, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $54.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. TRANSMITTER,COUNTER
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $54.0 million.
What is the period of performance?
Start: 2021-12-13. End: 2024-07-12.
What is the justification for awarding this contract on a sole-source basis?
The provided data indicates the contract was 'NOT COMPETED'. A formal justification for this sole-source award would typically be documented by the agency, outlining reasons such as urgency, unique capabilities, or lack of available sources. Without this documentation, it's impossible to fully assess the necessity of bypassing competition.
How does the unit cost compare to industry benchmarks for similar aircraft parts?
The data does not provide specific unit costs or detailed item descriptions, making a direct benchmark comparison impossible. The total award value is $53,969,072. To assess unit cost effectiveness, a breakdown of the parts, quantities, and their respective prices would be required, along with access to relevant industry cost databases.
What are the potential risks associated with a sole-source award for critical aircraft parts?
Sole-source awards for critical parts carry risks of inflated pricing due to lack of competition, potential for reduced quality if the contractor faces no pressure to innovate or improve, and supply chain vulnerability if the single source experiences disruptions. This also limits opportunities for smaller, innovative businesses to enter the market.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: SPRPA119QK193
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 600 HICKS RD, ROLLING MEADOWS, IL, 60008
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: $53,969,072
Exercised Options: $53,969,072
Current Obligation: $53,969,072
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $6,034
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPRPA122DD001
IDV Type: IDC
Timeline
Start Date: 2021-12-13
Current End Date: 2024-07-12
Potential End Date: 2024-07-12 00:00:00
Last Modified: 2023-10-06
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