DoD Awards $21.5M for PATRIOT Missile Spares to Raytheon, Raising Concerns Over Limited Competition
Contract Overview
Contract Amount: $21,536,077 ($21.5M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2025-09-03
End Date: 2029-04-30
Contract Duration: 1,335 days
Daily Burn Rate: $16.1K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: PATRIOT MISSILE SPARES PROCUREMENT
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $21.5 million to RAYTHEON COMPANY for work described as: PATRIOT MISSILE SPARES PROCUREMENT Key points: 1. Significant contract value for critical defense components. 2. Sole-source award to Raytheon Company limits competitive pricing. 3. Potential for inflated costs due to lack of market competition. 4. Sector is defense manufacturing, vital for national security.
Value Assessment
Rating: questionable
The contract value of $21.5M for PATRIOT missile spares is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar defense components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Raytheon Company. This lack of competition limits price discovery and may lead to higher costs for taxpayers.
Taxpayer Impact: The absence of competition for essential missile spares could result in the government paying a premium, impacting overall defense budget efficiency.
Public Impact
Ensures continued operational readiness of critical PATRIOT missile defense systems. Supports the defense industrial base and Raytheon's manufacturing capabilities. Potential for taxpayer funds to be used less efficiently due to non-competitive award.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- Long contract duration
Positive Signals
- Procurement of critical defense assets
- Supports national security objectives
Sector Analysis
This contract falls within the defense manufacturing sector, specifically for missile system components. Spending in this area is crucial for national security, but competitive procurement is essential for cost-effectiveness.
Small Business Impact
The data does not indicate any specific provisions or benefits for small businesses in this sole-source award to Raytheon Company.
Oversight & Accountability
Oversight is crucial for sole-source contracts to ensure fair pricing and prevent potential waste. The Department of Defense and the Defense Logistics Agency are responsible for monitoring this award.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award limits competition.
- Potential for price escalation.
- Long contract duration may not reflect current market conditions.
- Lack of transparency in price negotiation.
- Dependency on a single supplier for critical components.
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 $21.5 million to RAYTHEON COMPANY. PATRIOT MISSILE SPARES PROCUREMENT
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 $21.5 million.
What is the period of performance?
Start: 2025-09-03. End: 2029-04-30.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or the absence of other qualified sources. For critical defense systems like the PATRIOT missile, there might be specific reasons related to system integration and existing expertise that necessitate a single supplier, though this should be rigorously documented and justified to ensure taxpayer value.
What are the potential risks associated with a sole-source procurement of missile spares?
The primary risks include inflated pricing due to lack of competition, potential for reduced innovation from the supplier, and over-reliance on a single vendor. This can lead to higher long-term costs for maintenance and future upgrades, and could create vulnerabilities if the sole supplier faces production issues or significant price increases.
How can the government ensure value for money in future sole-source procurements for defense systems?
To ensure value, the government should conduct thorough market research to confirm the necessity of a sole-source award, negotiate aggressively on price using independent cost estimates, and consider shorter contract durations with options for re-competition. Robust oversight and performance metrics are also essential to hold the contractor accountable for delivery and quality.
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: ELECTRICAL/ELECTRONIC EQPT COMPNTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
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: $21,536,077
Exercised Options: $21,536,077
Current Obligation: $21,536,077
Subaward Activity
Number of Subawards: 9
Total Subaward Amount: $1,725,962
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: 2025-09-03
Current End Date: 2029-04-30
Potential End Date: 2029-04-30 00:00:00
Last Modified: 2025-10-15
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