Raytheon Company awarded $43.3M for urgent manpack radio system needs by the Department of Defense

Contract Overview

Contract Amount: $43,301,948 ($43.3M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2007-08-28

End Date: 2011-02-23

Contract Duration: 1,275 days

Daily Burn Rate: $34.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: URGENT REQUIREMENT FOR AN/PSC-5D MANPACK RADIO SYSTEM AND OTHER ANCILLARY ITEMS.

Place of Performance

Location: FORT WAYNE, ALLEN County, INDIANA, 46808

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $43.3 million to RAYTHEON COMPANY for work described as: URGENT REQUIREMENT FOR AN/PSC-5D MANPACK RADIO SYSTEM AND OTHER ANCILLARY ITEMS. Key points: 1. Contract addresses an urgent requirement for critical communication equipment. 2. Full and open competition was utilized, suggesting a broad market search. 3. The contract duration of 1275 days indicates a significant, long-term need. 4. Delivery order type suggests a specific, immediate need within a larger framework. 5. Fixed-price contract type aims to control costs for the government. 6. The contract was awarded to a single vendor, Raytheon Company.

Value Assessment

Rating: fair

The total award amount of $43.3 million for manpack radio systems and ancillary items appears to be within a reasonable range for such specialized military equipment, especially given the urgent nature of the requirement. However, without specific details on the quantity and technical specifications of the AN/PSC-5D systems and other items, a precise value-for-money assessment is challenging. Benchmarking against similar contracts for communication systems of comparable complexity and quantity would be necessary for a more definitive evaluation of pricing and value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that the Department of Defense sought proposals from all responsible sources. While the number of bidders is not specified, this approach generally promotes a competitive environment, which can lead to better pricing and innovation. The use of full and open competition suggests that the agency did not identify any specific barriers to entry or proprietary restrictions that would limit the pool of potential offerors.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it maximizes the potential for cost savings through a wider range of offers and encourages market competition, which can drive down prices.

Public Impact

The primary beneficiaries are military personnel requiring reliable and advanced communication systems in the field. The contract delivers urgent operational capability through the provision of AN/PSC-5D manpack radio systems. The geographic impact is likely global, supporting deployed forces wherever they operate. Workforce implications may include specialized technical support and maintenance roles for the radio systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Urgent requirement could lead to premium pricing.
Sole awardee to Raytheon Company, limiting immediate price comparison.
Long contract duration may not reflect current market technology prices.
Lack of specific unit cost data hinders detailed value analysis.

Positive Signals

Full and open competition was utilized, potentially driving competitive pricing.
Firm fixed-price contract type provides cost certainty for the government.
Award addresses a critical operational need for military communications.

Sector Analysis

This contract falls within the Defense sector, specifically concerning tactical communication equipment. The market for military radios is characterized by high technological sophistication, stringent performance requirements, and often long product lifecycles. Spending in this area is driven by the need for secure, reliable, and interoperable communication systems for global operations. Comparable spending benchmarks would involve other major defense contracts for communication suites or individual soldier systems.

Small Business Impact

Information regarding small business set-asides or subcontracting plans is not explicitly provided for this contract. Given the specialized nature of advanced communication systems, it is possible that larger prime contractors like Raytheon Company may engage small businesses for specific components or support services. However, without further details, the direct impact on the small business ecosystem remains unclear.

Oversight & Accountability

The contract is managed by the Defense Contract Management Agency (DCMA), which provides contract administration services to ensure compliance with terms and conditions. Oversight mechanisms would include performance monitoring, quality assurance, and financial reviews. Transparency is facilitated through contract award databases, though detailed performance metrics are often not publicly disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Tactical Communication Systems
Manpack Radios
Department of Defense Procurement
Raytheon Company Contracts
Urgent Operational Needs

Risk Flags

Urgent requirement may indicate poor prior planning or unforeseen operational needs.
Sole awardee limits future competitive pricing opportunities.
Long contract duration could lead to technology obsolescence concerns.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $43.3 million to RAYTHEON COMPANY. URGENT REQUIREMENT FOR AN/PSC-5D MANPACK RADIO SYSTEM AND OTHER ANCILLARY ITEMS.

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $43.3 million.

What is the period of performance?

Start: 2007-08-28. End: 2011-02-23.

What is the specific technical capability and operational advantage provided by the AN/PSC-5D manpack radio system?

The AN/PSC-5D is a family of manpack radios designed to provide secure, tactical voice and data communications for ground forces. It typically operates in the VHF/UHF frequency bands and offers features such as frequency hopping, encryption, and compatibility with various networking protocols. Its advantage lies in providing reliable, battlefield-level communication in diverse environments, supporting command and control, situational awareness, and unit cohesion. The 'urgent requirement' designation suggests that existing systems were insufficient or that a critical operational gap needed immediate filling, highlighting the system's importance for mission success.

How does the $43.3 million award compare to historical spending on similar communication systems by the DoD?

Comparing the $43.3 million award requires identifying specific comparable systems and contract periods. The AN/PSC-5D is a mature system, and its initial procurement or upgrades might have occurred over different fiscal years. Historical spending data for similar manpack or tactical radio systems procured by the DoD would be needed for a robust comparison. Factors like quantity, technological generation, and contract type (e.g., fixed-price vs. cost-plus) significantly influence total award values. Without these specifics, it's difficult to definitively state if this award represents an increase or decrease in spending trends for such equipment.

What are the potential risks associated with a sole award to Raytheon Company for this urgent requirement?

A primary risk of a sole award, even under full and open competition, is the potential for reduced price competition post-award if follow-on orders or sustainment services are needed. While the initial award was competed, the government becomes reliant on a single vendor for this specific urgent need. This could lead to less leverage in future negotiations for modifications, spare parts, or upgrades. Additionally, if Raytheon faces production issues or supply chain disruptions, the urgent requirement could be jeopardized, impacting operational readiness. The long contract duration also means the government is locked into this vendor for an extended period.

What does the 'urgent requirement' designation imply about the state of the DoD's communication readiness prior to this award?

The designation of an 'urgent requirement' strongly implies that the Department of Defense faced a critical, immediate need for the AN/PSC-5D manpack radio system and ancillary items that could not be fulfilled through standard procurement timelines. This suggests a potential gap in existing communication capabilities, a sudden increase in demand due to evolving operational environments, or the obsolescence of current equipment. It indicates a situation where mission accomplishment or personnel safety was potentially compromised without rapid acquisition, highlighting a possible deficiency in strategic planning, inventory management, or technological modernization efforts.

How does the firm fixed-price contract type mitigate risks for the government in this scenario?

A firm fixed-price (FFP) contract type is generally advantageous for the government, especially when dealing with well-defined requirements like specific equipment procurement. It shifts the risk of cost overruns from the government to the contractor, Raytheon Company. Under an FFP agreement, the contractor is obligated to complete the work for the agreed-upon price, regardless of their actual costs. This provides budget certainty for the Department of Defense and incentivizes the contractor to manage their costs efficiently. For an urgent requirement, this certainty is crucial for financial planning and avoiding unexpected budget impacts.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 870 WINTER ST, WALTHAM, MA, 02451

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $44,426,915

Exercised Options: $44,426,915

Current Obligation: $43,301,948

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4097G

IDV Type: FSS

Timeline