DoD awards $8.9M for new radio altimeters, with Rockwell Collins as sole source

Contract Overview

Contract Amount: $8,923,292 ($8.9M)

Contractor: Rockwell Collins, Inc.

Awarding Agency: Department of Defense

Start Date: 2025-12-19

End Date: 2027-03-31

Contract Duration: 467 days

Daily Burn Rate: $19.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: NEW MANUFACTURE OF RADIO ALTIMETERS FOR KC-135 AIRCRAFT

Place of Performance

Location: CEDAR RAPIDS, LINN County, IOWA, 52498

State: Iowa Government Spending

Plain-Language Summary

Department of Defense obligated $8.9 million to ROCKWELL COLLINS, INC. for work described as: NEW MANUFACTURE OF RADIO ALTIMETERS FOR KC-135 AIRCRAFT Key points: 1. Sole-source award raises concerns about price competition and potential overpayment. 2. Limited competition may hinder innovation and access to alternative suppliers. 3. Long contract duration (467 days) increases exposure to market fluctuations. 4. Fixed-price contract shifts performance risk to the contractor. 5. Contract supports critical KC-135 aircraft sustainment, ensuring operational readiness. 6. Awarded by Defense Logistics Agency, indicating a focus on supply chain efficiency.

Value Assessment

Rating: questionable

The contract value of $8.9 million for new radio altimeters is difficult to benchmark without specific unit costs and comparison to similar procurements. As a sole-source award, there is a heightened risk that the pricing may not reflect competitive market rates. Further analysis of the contractor's pricing structure and historical performance on similar contracts would be necessary to definitively assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Rockwell Collins, Inc., was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. The lack of competition means there was no direct price comparison or incentive for vendors to offer their best pricing.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of a competitive bidding process. Without competing offers, the government lacks assurance that the negotiated price is the lowest possible.

Public Impact

The primary beneficiaries are the U.S. Air Force and its KC-135 Stratotanker fleet, ensuring continued operational capability. The contract delivers essential new radio altimeter systems, crucial for safe flight operations. The geographic impact is national, supporting a key component of the U.S. strategic airlift and refueling capabilities. Workforce implications may include specialized manufacturing and technical support roles within Rockwell Collins and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially inflates costs.
Lack of competition may reduce opportunities for other qualified manufacturers.
Long-term contract duration increases exposure to potential supply chain disruptions or obsolescence.

Positive Signals

Firm fixed-price contract structure provides cost certainty for the government.
Award supports critical aviation safety equipment for a vital military aircraft.
Contractor, Rockwell Collins, is an established aerospace manufacturer with relevant experience.

Sector Analysis

The aerospace manufacturing sector, specifically focusing on aircraft components and systems, is characterized by high barriers to entry, significant R&D investment, and stringent quality requirements. This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' industry code (NAICS 336413). Spending in this sector is often driven by defense procurement needs for sustainment, upgrades, and new platforms. Comparable spending benchmarks would typically involve analyzing historical procurement data for similar avionics systems across different aircraft types and agencies.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. As a sole-source award to a large prime contractor, the direct impact on the small business ecosystem is likely minimal unless Rockwell Collins voluntarily engages small businesses in its supply chain for this specific contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Defense Contract Management Agency (DCMA) and the Defense Contract Audit Agency (DCAA), responsible for ensuring contractor performance, compliance, and cost reasonableness. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

KC-135 Stratotanker Sustainment Programs
Avionics Modernization Programs
Defense Logistics Agency Procurement of Aircraft Parts
Sole-Source Defense Contracts
Radio Altimeter Systems Procurement

Risk Flags

Sole-source justification required
Potential for price inflation due to lack of competition
Long contract duration increases market risk exposure

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.9 million to ROCKWELL COLLINS, INC.. NEW MANUFACTURE OF RADIO ALTIMETERS FOR KC-135 AIRCRAFT

Who is the contractor on this award?

The obligated recipient is ROCKWELL COLLINS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $8.9 million.

What is the period of performance?

Start: 2025-12-19. End: 2027-03-31.

What is Rockwell Collins' track record with the Defense Logistics Agency and on similar sole-source contracts?

Rockwell Collins, Inc. (now part of Collins Aerospace, a Raytheon Technologies company) has a long-standing history of supplying avionics and other aerospace components to the Department of Defense and its various agencies, including the Defense Logistics Agency (DLA). Their track record generally indicates significant experience and capability in producing complex aircraft systems. However, specific performance data on past sole-source awards for radio altimeters would require a deeper dive into contract performance reports and historical award data. Without this granular detail, it's challenging to assess their specific performance on prior sole-source procurements of this nature, which inherently carry higher risk due to lack of competition.

How does the $8.9 million contract value compare to market rates for similar radio altimeter systems?

Benchmarking the $8.9 million contract value against market rates for similar radio altimeter systems is challenging without specific unit cost data and a clear understanding of the system's technical specifications and required certifications. As a sole-source award, direct price comparison to competitive bids is impossible. To assess value, one would typically compare the proposed unit price against industry benchmarks for comparable avionics, factoring in the specific requirements for the KC-135 platform, such as environmental ruggedization, interface compatibility, and lifespan. Historical pricing data from Rockwell Collins or other manufacturers for similar, albeit potentially less complex, systems could offer a partial comparison, but the unique nature of sole-source procurement often obscures true market value.

What are the primary risks associated with a sole-source award for critical aircraft components like radio altimeters?

The primary risks associated with a sole-source award for critical aircraft components like radio altimeters include inflated pricing due to the lack of competitive pressure, potential for reduced innovation as the contractor faces no direct competition, and a heightened dependence on a single supplier. This dependence can lead to supply chain vulnerabilities if the sole source experiences production issues or goes out of business. Furthermore, the government loses the opportunity to explore potentially more cost-effective or technologically advanced solutions that might be offered by other qualified vendors. The absence of competition makes robust cost analysis and negotiation by the contracting agency even more critical.

How does the firm fixed-price contract type mitigate or exacerbate risks for this procurement?

A Firm Fixed Price (FFP) contract type generally mitigates cost uncertainty for the government, as the contractor agrees to a set price regardless of their actual costs. This shifts the financial risk of cost overruns to the contractor. For this procurement of new radio altimeters, FFP provides budget predictability. However, in a sole-source situation, the risk is that the 'fixed' price may have been negotiated upwards due to the lack of competition. If the contractor significantly underestimated costs, they might cut corners on quality, although quality assurance measures should prevent this. The FFP structure is beneficial for managing budget but does not inherently guarantee a fair price in a non-competitive environment.

What is the historical spending pattern for radio altimeters or similar avionics for the KC-135 fleet?

Historical spending patterns for radio altimeters and similar avionics for the KC-135 fleet would likely show a mix of competitive and sole-source awards over the aircraft's long service life. Early procurements might have been competitive, while later sustainment or upgrade efforts, especially for specialized or legacy components where only one manufacturer remains viable, could shift towards sole-source contracts. Analyzing past DLA or Air Force contract awards for KC-135 avionics would reveal trends in pricing, competition levels, and the frequency of sole-source justifications. This specific $8.9 million award for 'new manufacture' suggests a need for replacement or upgrade beyond simple repair, potentially driven by obsolescence or performance enhancement requirements.

What are the implications of the contract duration (467 days) on the overall cost and risk?

A contract duration of 467 days (approximately 15.5 months) for the delivery of new radio altimeters implies a significant production and delivery timeline. This duration increases the government's exposure to potential market shifts, such as changes in raw material costs or labor availability, which could impact the contractor's actual costs. While the FFP structure aims to insulate the government from cost increases, a longer duration in a sole-source context might allow the contractor to build potential cost escalations into the initial fixed price. It also means the KC-135 fleet relies on this single source for a substantial period, highlighting the importance of the contractor's production capacity and supply chain reliability.

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

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 400 COLLINS RD NE, CEDAR RAPIDS, IA, 52498

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: $8,923,292

Exercised Options: $8,923,292

Current Obligation: $8,923,292

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPE4AX20D9407

IDV Type: IDC

Timeline