Boeing awarded $218.8M for EMARSS development, a critical ISR system for the DoD
Contract Overview
Contract Amount: $218,820,279 ($218.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2010-11-30
End Date: 2016-11-14
Contract Duration: 2,176 days
Daily Burn Rate: $100.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: ENGINEERING AND MANUFACTURING PHASE FOR THE ENHANCED MEDIUM ALTITUDE RECONNAISSANCE AND SURVEILLANCE SYSTEM (EMARSS), RESEARCH AND DEVELOPMENT SERVICES TO PRODUCE FOUR EMD EMARSS UNITS WITH OPTIONS FOR ADDITIONAL EMD UNITS AND LRIP UNITS AND ICLS SUPPORT.
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35824
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $218.8 million to THE BOEING COMPANY for work described as: ENGINEERING AND MANUFACTURING PHASE FOR THE ENHANCED MEDIUM ALTITUDE RECONNAISSANCE AND SURVEILLANCE SYSTEM (EMARSS), RESEARCH AND DEVELOPMENT SERVICES TO PRODUCE FOUR EMD EMARSS UNITS WITH OPTIONS FOR ADDITIONAL EMD UNITS AND LRIP UNITS AND ICLS SUPPORT. Key points: 1. This contract represents a significant investment in advanced reconnaissance capabilities. 2. The cost-plus-incentive-fee structure aims to balance contractor performance with government cost control. 3. The program's success hinges on the timely delivery of four EMD units and potential follow-on production. 4. Competition was robust, suggesting a healthy market for these specialized engineering services. 5. The EMARSS system is vital for enhancing the military's situational awareness in complex environments. 6. Long-term sustainment and potential for additional units indicate ongoing program value.
Value Assessment
Rating: good
The total contract value of $218.8 million for the engineering and manufacturing development of four EMARSS units appears reasonable given the complexity of advanced reconnaissance systems. While specific benchmarking data for EMARSS is not publicly available, similar R&D contracts for sophisticated defense platforms often involve substantial upfront investment. The cost-plus-incentive-fee (CPIF) pricing structure allows for flexibility while incentivizing the contractor to manage costs effectively. The government's ability to procure additional units and support suggests a potentially favorable long-term value proposition if performance targets are met.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. With six bidders participating, the level of competition was substantial, which typically drives more competitive pricing and encourages innovation. This broad competition suggests that the Department of Defense was able to leverage market forces to secure the best possible technical solution and value for this critical development effort.
Taxpayer Impact: A competitive bidding process for advanced defense systems like EMARSS helps ensure that taxpayer dollars are used efficiently by fostering price discovery and reducing the likelihood of inflated costs.
Public Impact
The primary beneficiaries are the U.S. Army and other branches of the Department of Defense, who will receive enhanced intelligence, surveillance, and reconnaissance capabilities. The contract will deliver four Enhanced Medium Altitude Reconnaissance and Surveillance System (EMARSS) Engineering and Manufacturing Development (EMD) units. The geographic impact is national, supporting military operations worldwide, with potential for deployment from various bases. The program will likely support a specialized workforce in engineering, manufacturing, and systems integration, primarily within the aerospace and defense sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in CPIF contracts if not closely managed.
- Dependence on a single contractor (Boeing) for critical development and potential future production.
- Risk of schedule delays impacting the timely fielding of crucial ISR capabilities.
- Technological obsolescence if development timelines are not met in a rapidly evolving threat landscape.
Positive Signals
- Awarded under full and open competition, indicating a robust selection process.
- CPIF contract type incentivizes contractor performance and cost control.
- Options for additional units and support suggest long-term program viability and potential for follow-on work.
- Boeing's established track record in aerospace and defense manufacturing provides a degree of confidence in execution.
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on intelligence, surveillance, and reconnaissance (ISR) systems. The market for such specialized systems is characterized by high barriers to entry due to technological complexity and stringent government requirements. Comparable spending benchmarks are difficult to ascertain without proprietary data, but R&D contracts for advanced military platforms typically represent significant portions of defense budgets, reflecting the critical nature and high cost of innovation in this field.
Small Business Impact
This contract was awarded under full and open competition and does not appear to have a specific small business set-aside. However, as a large prime contractor, The Boeing Company is expected to utilize small businesses for subcontracting opportunities, contributing to the small business ecosystem within the aerospace and defense supply chain. The specific subcontracting plan details would be crucial to assessing the direct impact on small businesses.
Oversight & Accountability
Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), responsible for ensuring contractor compliance with terms and conditions. The CPIF structure includes specific incentive targets that require rigorous monitoring and evaluation by the government. Transparency is facilitated through contract reporting mechanisms, and the Inspector General's office within the Department of Defense would have jurisdiction over any potential fraud, waste, or abuse related to this award.
Related Government Programs
- Intelligence, Surveillance, and Reconnaissance (ISR) Platforms
- Aerospace R&D Contracts
- Advanced Manufacturing Programs
- DoD Aircraft Procurement
- Defense Systems Development
Risk Flags
- Potential for cost growth in CPIF contracts.
- Schedule slippage risk in complex R&D.
- Technological obsolescence concerns.
- Dependence on contractor performance for critical capabilities.
Tags
defense, department-of-defense, boeing, research-and-development, engineering, intelligence-surveillance-reconnaissance, aircraft-manufacturing, full-and-open-competition, cost-plus-incentive-fee, definitive-contract, alabama, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $218.8 million to THE BOEING COMPANY. ENGINEERING AND MANUFACTURING PHASE FOR THE ENHANCED MEDIUM ALTITUDE RECONNAISSANCE AND SURVEILLANCE SYSTEM (EMARSS), RESEARCH AND DEVELOPMENT SERVICES TO PRODUCE FOUR EMD EMARSS UNITS WITH OPTIONS FOR ADDITIONAL EMD UNITS AND LRIP UNITS AND ICLS SUPPORT.
Who is the contractor on this award?
The obligated recipient is THE BOEING 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 $218.8 million.
What is the period of performance?
Start: 2010-11-30. End: 2016-11-14.
What is The Boeing Company's track record with similar large-scale defense R&D contracts?
The Boeing Company has an extensive and well-documented track record with large-scale defense research and development contracts across various platforms, including aircraft, satellites, and integrated systems. They have historically been a prime contractor for numerous complex military programs, often involving significant R&D components. While specific performance metrics for past R&D efforts are not always publicly disclosed, Boeing's continued selection for major defense initiatives suggests a generally positive performance history and capability to manage complex development cycles. However, like any large defense contractor, they have also faced scrutiny and challenges on specific programs related to cost, schedule, and technical performance, underscoring the importance of diligent oversight for contracts like EMARSS.
How does the $218.8 million development cost compare to similar ISR system development programs?
Directly comparing the $218.8 million development cost for the EMARSS EMD phase to similar ISR system programs is challenging due to the proprietary nature of defense contracting and the unique specifications of each system. However, the figure is substantial, reflecting the complexity and advanced technology involved in developing a medium-altitude reconnaissance and surveillance platform. Programs like the development of unmanned aerial systems (UAS) or upgrades to existing manned reconnaissance aircraft can range from tens to hundreds of millions of dollars for their R&D phases. The cost-plus-incentive-fee structure suggests that the government anticipates significant development effort and is willing to share in the costs while incentivizing performance, which is typical for cutting-edge defense R&D.
What are the primary risks associated with the Engineering and Manufacturing Development (EMD) phase for the EMARSS system?
The primary risks associated with the EMD phase for the EMARSS system include technical challenges in integrating complex sensor and communication payloads, potential for schedule delays due to unforeseen design issues or testing failures, and cost overruns inherent in a Cost Plus Incentive Fee (CPIF) contract. Ensuring the system meets all performance specifications for altitude, range, endurance, and data processing is critical. Furthermore, the transition from EMD to Low Rate Initial Production (LRIP) carries risks related to manufacturing scalability and supply chain readiness. The evolving threat landscape also poses a risk, as the system's capabilities must remain relevant throughout its lifecycle.
What is the expected program effectiveness and impact of the EMARSS system once fielded?
The EMARSS system is expected to significantly enhance the Department of Defense's intelligence, surveillance, and reconnaissance (ISR) capabilities. By providing persistent, medium-altitude surveillance, it will offer real-time situational awareness to ground forces and commanders, improving decision-making and operational effectiveness. Its advanced sensors are designed to detect and identify targets of interest in various operational environments, contributing to force protection and mission success. The system's modular design may also allow for future upgrades, ensuring its relevance against evolving threats. Ultimately, EMARSS aims to provide a critical ISR asset that improves the military's ability to gather actionable intelligence.
How has historical spending on similar ISR development contracts trended within the DoD?
Historical spending on similar ISR development contracts within the DoD has generally trended upwards, driven by the increasing demand for real-time intelligence and the rapid advancement of sensor and data processing technologies. Significant investments have been made in both manned and unmanned ISR platforms, as well as in the development of sophisticated sensor payloads and data analysis tools. The shift towards networked warfare and multi-domain operations further emphasizes the need for robust ISR capabilities. While specific figures fluctuate based on program priorities and budget allocations, the overall trend indicates a sustained and often growing commitment to enhancing the nation's ISR enterprise through continuous R&D and procurement.
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: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W15P7T10RS206
Offers Received: 6
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Address: 499 BOEING BLVD SW, HUNTSVILLE, AL, 35824
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: $349,282,239
Exercised Options: $218,820,279
Current Obligation: $218,820,279
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2010-11-30
Current End Date: 2016-11-14
Potential End Date: 2016-11-14 00:00:00
Last Modified: 2024-06-18
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