Defense navigation equipment contract awarded to Honeywell for over $13M, with limited competition

Contract Overview

Contract Amount: $13,066,820 ($13.1M)

Contractor: Honeywell International Inc.

Awarding Agency: Department of Defense

Start Date: 2025-09-30

End Date: 2027-09-30

Contract Duration: 730 days

Daily Burn Rate: $17.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: PROCUREMENT OF NAVIGATION EQUIPMENT.

Place of Performance

Location: CLEARWATER, PINELLAS County, FLORIDA, 33764

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $13.1 million to HONEYWELL INTERNATIONAL INC. for work described as: PROCUREMENT OF NAVIGATION EQUIPMENT. Key points: 1. Value appears fair given the specialized nature of navigation systems, but detailed benchmarking is needed. 2. Sole-source award limits price discovery and potentially increases costs for taxpayers. 3. Contract duration of two years presents moderate performance risk. 4. Positioned within the defense sector's critical navigation and guidance systems market. 5. No small business set-aside indicates potential missed opportunities for smaller firms.

Value Assessment

Rating: fair

The contract value of $13.07 million for navigation equipment is substantial. Without specific details on the equipment's capabilities and quantity, direct comparison to similar contracts is challenging. However, given the specialized nature of defense navigation systems, the price may be within a reasonable range. Further analysis would require benchmarking against industry standards for comparable systems and assessing if the firm-fixed-price structure adequately incentivizes cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Honeywell International Inc., was solicited. This approach bypasses the competitive bidding process, which typically leads to better price discovery and potentially lower costs. The lack of competition raises concerns about whether the government secured the best possible value.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as there is no competitive pressure to drive down costs. This limits the government's ability to leverage market forces for cost savings.

Public Impact

The Department of the Army benefits from the procurement of essential navigation equipment. This contract supports the operational readiness and effectiveness of military assets. The equipment is intended for use in Florida, impacting regional defense capabilities. The contract likely supports specialized technical roles within Honeywell and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially leading to higher costs.
Lack of transparency in the sole-source justification requires scrutiny.
Performance risks associated with specialized defense equipment procurement.

Positive Signals

Award to a known defense contractor with established capabilities.
Firm-fixed-price contract provides cost certainty for the government.
Clear delivery and performance end dates.

Sector Analysis

This contract falls within the defense sector, specifically focusing on navigation, guidance, and control systems. The market for such specialized equipment is often characterized by high barriers to entry due to technological complexity and stringent quality requirements. Spending in this area is critical for national security and military modernization efforts. Comparable spending benchmarks would typically be found within other defense procurements for similar advanced electronic systems.

Small Business Impact

The contract was not competed and did not include a small business set-aside. This indicates that opportunities for small businesses to participate in this specific procurement were likely limited, either as prime contractors or through subcontracting unless specifically included by the prime. Further investigation into subcontracting plans would be necessary to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures are inherent in the contract terms, including delivery schedules and performance specifications. Transparency may be limited due to the sole-source nature of the award, but contract award details are typically made public. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Defense Navigation Systems
Military Guidance Equipment
Aeronautical and Nautical Instruments
Department of the Army Procurements
Honeywell Defense Contracts

Risk Flags

Sole-source award may limit price competition.
Lack of detailed justification for sole-source award requires review.
Potential for higher costs due to lack of competitive bidding.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.1 million to HONEYWELL INTERNATIONAL INC.. PROCUREMENT OF NAVIGATION EQUIPMENT.

Who is the contractor on this award?

The obligated recipient is HONEYWELL INTERNATIONAL INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $13.1 million.

What is the period of performance?

Start: 2025-09-30. End: 2027-09-30.

What is the specific type and capability of the navigation equipment being procured?

The provided data indicates the procurement is for 'NAVIGATION EQUIPMENT' under NAICS code 334511 (Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing). While the exact specifications are not detailed, this suggests advanced systems crucial for military operations. These could range from GPS receivers and inertial navigation systems to more complex integrated platforms for aircraft, vessels, or ground vehicles. The 'PROCUREMENT OF NAVIGATION EQUIPMENT' description is broad, necessitating a review of the contract's statement of work (SOW) for precise details on functionality, performance requirements, and intended application within the Department of the Army.

Why was this contract awarded on a sole-source basis instead of being competed?

Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. For defense navigation equipment, this could be due to proprietary technology, unique compatibility requirements with existing military systems, or a lack of other qualified vendors capable of meeting the stringent specifications within the required timeframe. The Department of the Army would have had to document the justification for this sole-source award, likely citing reasons such as specialized technical expertise, existing sole-source intellectual property, or urgent need where competition would cause unacceptable delays. A review of the Justification and Approval (J&A) document associated with this contract would provide the specific rationale.

How does the $13.07 million contract value compare to historical spending on similar navigation equipment by the Department of the Army?

Comparing the $13.07 million contract value requires access to historical spending data for similar navigation equipment procured by the Department of the Army. Without specific details on the equipment's capabilities and quantities, a direct comparison is difficult. However, if this procurement represents a significant increase or decrease compared to previous acquisitions of comparable systems, it could indicate changes in market prices, technological advancements, or shifts in operational requirements. Analyzing trends in spending for navigation systems over the past 5-10 years, adjusted for inflation and technological evolution, would provide valuable context for assessing the value proposition of this award.

What are the potential risks associated with a sole-source award for critical defense navigation equipment?

A primary risk of a sole-source award is the lack of competitive pressure, which can lead to inflated pricing and reduced incentive for the contractor to innovate or optimize costs. Taxpayers may end up paying more than they would in a competitive environment. Furthermore, reliance on a single supplier can create supply chain vulnerabilities; if the sole-source provider experiences production issues, financial instability, or decides to discontinue the product line, the Department of the Army could face significant operational disruptions. There's also a risk that the government might not be getting the most technologically advanced solution available if other potential vendors with superior offerings were not considered.

What is Honeywell International Inc.'s track record with the Department of Defense for navigation systems?

Honeywell International Inc. is a major defense contractor with a significant history of providing various systems, including navigation equipment, to the Department of Defense. Their track record typically includes supplying components and integrated systems for aircraft, spacecraft, and other military platforms. While specific performance metrics for past navigation system contracts are not detailed here, Honeywell is generally recognized for its technological capabilities in aerospace and defense. A thorough assessment would involve reviewing past contract performance ratings, any reported issues or disputes, and the overall history of successful delivery of similar systems to the DoD.

What are the implications of the contract's firm-fixed-price (FFP) type for cost control and risk?

A firm-fixed-price (FFP) contract is generally favorable for the government as it shifts most of the cost risk to the contractor. The price is set and not subject to adjustment based on the contractor's cost experience. This provides budget certainty for the Department of the Army. However, for highly complex or R&D-intensive procurements, an FFP contract can sometimes lead to contractors bidding higher prices to cover potential unforeseen costs, or it might disincentivize them from incorporating cost-saving innovations during performance. For standard or well-defined navigation equipment, FFP is often a suitable choice for managing costs and ensuring predictable spending.

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: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Honeywell Safety Products USA, Inc.

Address: 13350 US HIGHWAY 19 N, CLEARWATER, FL, 33764

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $13,066,820

Exercised Options: $13,066,820

Current Obligation: $13,066,820

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $344,271

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Parent Contract

Parent Award PIID: FA857620D0001

IDV Type: IDC

Timeline