DoD awards Northrop Grumman $40.3M for WING OUTER PANEL AS, a sole-source contract
Contract Overview
Contract Amount: $40,278,672 ($40.3M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2013-07-22
End Date: 2017-03-31
Contract Duration: 1,348 days
Daily Burn Rate: $29.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: WING OUTER PANEL AS
Place of Performance
Location: MELBOURNE, BREVARD County, FLORIDA, 32904
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $40.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: WING OUTER PANEL AS Key points: 1. Significant award to a major defense contractor. 2. Sole-source nature raises questions about price discovery. 3. Contract duration of over 3 years. 4. Focus on aeronautical system manufacturing.
Value Assessment
Rating: questionable
The contract value of $40.3 million for a WING OUTER PANEL AS is difficult to assess without specific unit cost data. Given the sole-source nature, it's challenging to benchmark against competitive pricing.
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 potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition may result in a higher cost to taxpayers than if the contract had been awarded through a competitive bidding process.
Public Impact
Impacts the defense supply chain for aircraft components. Potential for increased costs due to sole-source award. Supports a major defense contractor's operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Award to established contractor
- Specific component for defense systems
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically for aeronautical systems. Spending in this area is critical for national security but often involves complex, high-value components.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corporation, a large business. There is no indication of small business participation in this specific award.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency. Oversight would focus on delivery and quality of the WING OUTER PANEL AS, with price scrutiny limited by the sole-source nature.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award
- Lack of competitive bidding
- Potential for price inflation
- Long contract duration without re-competition
Tags
search-detection-navigation-guidance-aer, department-of-defense, fl, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $40.3 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. WING OUTER PANEL AS
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 Contract Management Agency).
What is the total obligated amount?
The obligated amount is $40.3 million.
What is the period of performance?
Start: 2013-07-22. End: 2017-03-31.
What is the rationale for the sole-source award of the WING OUTER PANEL AS, and what steps were taken to ensure fair and reasonable pricing?
The rationale for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. To ensure fair and reasonable pricing, the agency would likely conduct a price analysis based on historical data, cost proposals, or market research, even without direct competition.
What are the potential risks associated with a sole-source contract for critical aircraft components like the WING OUTER PANEL AS?
Sole-source contracts for critical components carry risks of inflated prices due to lack of competition, potential for complacency from the contractor regarding innovation or efficiency, and a reduced ability to switch suppliers if performance issues arise. This can lead to higher long-term costs and potential supply chain vulnerabilities.
How does the $40.3 million award for the WING OUTER PANEL AS compare to industry benchmarks for similar components, considering its sole-source nature?
Without competitive bids, direct benchmarking is challenging. However, the price would ideally be assessed against historical data for similar panels, Northrop Grumman's own previous pricing, or estimated costs based on material, labor, and overhead. The absence of competition suggests the price might be higher than if multiple vendors had vied for the contract.
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: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 600 GRUMMAN RD WEST, BETHPAGE, NY, 11714
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $40,278,672
Exercised Options: $40,278,672
Current Obligation: $40,278,672
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SPM4AX12D9401
IDV Type: IDC
Timeline
Start Date: 2013-07-22
Current End Date: 2017-03-31
Potential End Date: 2017-03-31 00:00:00
Last Modified: 2016-07-12
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