DoD Awards $64M for Aircraft Parts, Exhaust Systems to Northrop Grumman, Lacking Competition
Contract Overview
Contract Amount: $64,111,472 ($64.1M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2025-12-23
End Date: 2031-03-31
Contract Duration: 1,924 days
Daily Burn Rate: $33.3K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: PIPE, EXHAUST
Place of Performance
Location: CLEARFIELD, DAVIS County, UTAH, 84016
State: Utah Government Spending
Plain-Language Summary
Department of Defense obligated $64.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: PIPE, EXHAUST Key points: 1. Significant contract value of $64.1M for critical aircraft components. 2. Sole-source award to Northrop Grumman raises concerns about competitive pricing. 3. Long contract duration (2031) may limit future cost-saving opportunities. 4. Lack of competition suggests potential for inflated costs and reduced innovation.
Value Assessment
Rating: questionable
The contract value of $64.1M for aircraft parts and exhaust systems is substantial. Without competitive bidding, it's difficult to assess if this price reflects fair market value compared to similar contracts for specialized aerospace components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Northrop Grumman. This method bypasses the price discovery benefits of a competitive process, potentially leading to higher costs for the government.
Taxpayer Impact: The lack of competition on this $64.1M contract means taxpayers may be paying a premium for these aircraft parts and exhaust systems, as there was no market pressure to drive down prices.
Public Impact
Taxpayers may be overpaying for essential aircraft components due to the absence of competitive bidding. The long-term nature of the contract (ending 2031) could lock the DoD into potentially suboptimal pricing for over a decade. Reliance on a single supplier for critical parts can create supply chain vulnerabilities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- No small business participation noted
Positive Signals
- Critical component procurement
- Established contractor (Northrop Grumman)
Sector Analysis
The aerospace and defense sector often involves complex, high-value contracts for specialized parts. Benchmarks for similar aircraft components can vary widely based on technology and customization, but competitive processes are crucial for ensuring value.
Small Business Impact
There is no indication of small business participation in this contract. Sole-source awards, especially to large prime contractors like Northrop Grumman, often do not include specific provisions for subcontracting to small businesses.
Oversight & Accountability
The lack of competition warrants scrutiny from oversight bodies to ensure the government is receiving the best possible value and that the sole-source justification is robust.
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 overpricing
- Long contract duration
- No stated small business participation
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, ut, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $64.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. PIPE, EXHAUST
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 $64.1 million.
What is the period of performance?
Start: 2025-12-23. End: 2031-03-31.
What is the justification for awarding this contract on a sole-source basis, and has an independent cost analysis been performed?
The justification for a sole-source award is critical for understanding why competition was bypassed. An independent cost analysis would provide a baseline to assess the fairness of the negotiated price, ensuring the government isn't overpaying for the parts and exhaust systems. Without this, the $64.1M price remains unvalidated.
What are the risks associated with relying on a single supplier for these critical aircraft components over an 8-year period?
Sole-source reliance for critical components over an extended period introduces significant risks. These include potential supply chain disruptions if the sole provider faces issues, lack of incentive for the contractor to innovate or improve quality, and vulnerability to price increases without competitive alternatives. This could impact aircraft readiness and operational costs.
How does the $64.1M contract value compare to industry benchmarks for similar aircraft parts and exhaust systems, considering the lack of competition?
Without competitive bidding, directly comparing this $64.1M contract to industry benchmarks is challenging. Typically, competition drives prices down. The absence of a competitive process suggests this price may be higher than what could have been achieved through open bidding. A thorough market research report or cost analysis would be needed for a valid comparison.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: SPRTA123R0093
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 6401 S AIR DEPOT BLVD, OKLAHOMA CITY, OK, 73135
Business Categories: Category Business, Corporate Entity Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $64,111,472
Exercised Options: $64,111,472
Current Obligation: $64,111,472
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPRTA119D0001
IDV Type: IDC
Timeline
Start Date: 2025-12-23
Current End Date: 2031-03-31
Potential End Date: 2031-03-31 00:00:00
Last Modified: 2025-12-23
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