DoD awards $37.4M for Radar Warning Receivers to BAE Systems, a sole-source contract

Contract Overview

Contract Amount: $37,368,847 ($37.4M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2018-09-26

End Date: 2022-11-30

Contract Duration: 1,526 days

Daily Burn Rate: $24.5K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: RADAR WARNING RECEIVERS

Place of Performance

Location: TOTOWA, PASSAIC County, NEW JERSEY, 07512

State: New Jersey Government Spending

Plain-Language Summary

Department of Defense obligated $37.4 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: RADAR WARNING RECEIVERS Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Significant duration of over 4 years suggests a long-term need. 3. Fixed-price contract type shifts performance risk to the contractor. 4. No small business set-aside indicates potential for large prime contractor. 5. Contractor is a major defense supplier, suggesting established capabilities. 6. Geographic location in New Jersey may have local economic impact.

Value Assessment

Rating: fair

The contract value of $37.4 million for Radar Warning Receivers over a period of approximately 4 years appears to be within a reasonable range for specialized defense electronics. However, without specific details on the quantity, specifications, and performance requirements of the receivers, a precise value-for-money assessment is challenging. Benchmarking against similar sole-source procurements for comparable systems would be necessary for a more definitive evaluation. The firm fixed-price structure provides cost certainty for the government, but the lack of competition could lead to less favorable pricing than in a competitive scenario.

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 typically occurs when only one vendor possesses the necessary capabilities, technology, or security clearances, or when urgency dictates a direct award. The lack of competition means that the government did not benefit from the price discovery mechanisms inherent in a competitive bidding process, potentially leading to higher costs than if multiple offers had been solicited.

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 constrained by the sole-source nature of the award.

Public Impact

The Department of Defense is the primary beneficiary, receiving critical electronic warfare components. The contract supports the operational readiness and technological superiority of military platforms. The contract's impact is primarily national, supporting defense infrastructure. Workforce implications may include specialized engineering and manufacturing roles at BAE Systems' New Jersey facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially inflates costs.
Lack of transparency in the justification for sole-source award.
Long contract duration without clear performance metrics makes oversight difficult.

Positive Signals

Firm fixed-price contract shifts cost risk to the contractor.
BAE Systems is a reputable defense contractor with established expertise.
Contract supports critical national defense capabilities.

Sector Analysis

The defense electronics sector is characterized by high technological complexity, significant R&D investment, and long product lifecycles. Radar Warning Receivers are a critical component of electronic warfare systems, designed to detect and identify radar signals. The market is often dominated by a few large, specialized contractors due to the stringent requirements and high barriers to entry. Spending in this area is driven by evolving threats and the need for advanced situational awareness for military platforms. Comparable spending benchmarks are difficult to establish without detailed system specifications, but significant investments are typical for such critical defense technologies.

Small Business Impact

The contract was not awarded as a small business set-aside, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the prime contract was awarded to a large business, BAE Systems. While this may not directly benefit small businesses through prime contract awards, there is potential for subcontracting opportunities if BAE Systems chooses to engage small businesses for specific components or services. However, without explicit set-aside or subcontracting plans, the direct impact on the small business ecosystem is likely limited.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contract management agencies, such as the Defense Contract Management Agency (DCMA). Given the sole-source nature and firm fixed-price structure, oversight would focus on ensuring delivery of specified goods, adherence to contract terms, and financial accountability. Transparency is limited by the sole-source justification, but contract modifications and payment milestones would be subject to review. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Electronic Warfare Systems
Radar Systems
Defense Electronics Manufacturing
Military Aircraft Components
Naval Systems

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.4 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. RADAR WARNING RECEIVERS

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION 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 $37.4 million.

What is the period of performance?

Start: 2018-09-26. End: 2022-11-30.

What is the specific technical capability and performance of the Radar Warning Receivers being procured?

The provided data does not specify the exact technical capabilities or performance metrics of the Radar Warning Receivers (RWRs). RWRs are typically designed to detect, identify, and analyze incoming radar signals, providing crucial threat warning information to aircrews or ground personnel. The specific performance characteristics, such as frequency range, sensitivity, accuracy, and processing power, would depend on the intended platform and mission requirements. Without detailed specifications, it is difficult to assess the technological sophistication or operational effectiveness of these particular RWRs. Further information would be needed from the contract's statement of work or technical exhibits to understand the precise nature of the system being acquired.

How does the contract price of $37.4 million compare to similar Radar Warning Receiver procurements?

A direct price comparison for this $37.4 million contract is challenging without knowing the specific quantity, technical specifications, and duration of the support. Radar Warning Receiver systems can vary significantly in complexity and cost. However, given that this is a sole-source award to a major defense contractor like BAE Systems, the price may be higher than if it had been competitively procured. To benchmark effectively, one would need to identify comparable sole-source or competitive contracts for RWR systems with similar technological capabilities and quantities procured over a comparable timeframe. Publicly available contract databases and defense budget reports could offer some comparative data points, but precise matches are rare due to the specialized nature of defense procurement.

What are the primary risks associated with this sole-source contract for Radar Warning Receivers?

The primary risk associated with this sole-source contract is the potential for inflated costs due to the lack of competitive bidding. Without competing offers, the government may not achieve the most favorable pricing. Another risk is contractor performance; while BAE Systems is a reputable firm, any sole-source award inherently reduces the leverage the government has to ensure optimal performance and timely delivery. There's also a risk of technological obsolescence if the RWRs procured are not cutting-edge or if the contract duration extends beyond the useful life of the technology. Finally, the justification for the sole-source award itself could be scrutinized if it was not adequately supported, potentially indicating a failure in the procurement process.

What is the historical spending pattern for Radar Warning Receivers by the Department of Defense?

Historical spending on Radar Warning Receivers (RWRs) by the Department of Defense (DoD) is substantial and ongoing, reflecting the critical nature of electronic warfare capabilities. The DoD consistently invests in RWR technology to maintain situational awareness and counter evolving threats across all branches of service. Spending fluctuates based on modernization programs, platform upgrades, and the introduction of new threat detection technologies. While specific aggregate figures for RWRs are not readily available without deep dives into defense budget line items, it is understood that such systems are a significant part of the broader electronic warfare and avionics procurement portfolios. The trend is generally towards more sophisticated, multi-function systems capable of handling a wider spectrum of threats.

What is the track record of BAE Systems in delivering Radar Warning Receiver systems to the DoD?

BAE Systems has a long and established track record as a major supplier of electronic warfare systems, including Radar Warning Receivers, to the Department of Defense and allied nations. They are a significant player in the defense electronics market, known for developing and integrating advanced avionics and combat systems. Their experience spans decades, and they have supplied RWRs for numerous platforms, including fighter jets, bombers, and transport aircraft. While specific contract performance details for every RWR delivery are not publicly detailed, BAE Systems' continued success in securing large defense contracts suggests a generally positive performance history and a high level of trust from the DoD regarding their capabilities in this domain.

Industry Classification

NAICS: Manufacturing › Semiconductor and Other Electronic Component Manufacturing › Other Electronic Component Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC

Address: 100 CAMPUS RD STE 1, TOTOWA, NJ, 07512

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: $37,368,847

Exercised Options: $37,368,847

Current Obligation: $37,368,847

Actual Outlays: $2,836,729

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: SPE4AX15D9441

IDV Type: IDC

Timeline