DoD Awards Northrop Grumman $51M for Next Generation Automatic Test Station Subassemblies
Contract Overview
Contract Amount: $51,022,729 ($51.0M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2009-11-20
End Date: 2012-06-30
Contract Duration: 953 days
Daily Burn Rate: $53.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: UCA LETTER CONTRACT FOR LOW RATE INITIAL PRODUCTION (LRIP) OF THE NEXT GENERATION AUTOMATIC TEST STATION (NGATS)SUBASSEMBLY, A PART OF THE INTEGRATED FAMILY OF TEST EQUIPMENT (IFTE). THE WORK INCLUDES FABRICATION, ASSEMBLY, TESTING, DEMONSTRATIONS, AND DELIVERY OF 16 OF THE PRODUCTION NGATS SUB ASSEMBLIES, AS WELL AS SUPPORT FOR INTEGRATION, INSTALLATION AND CHECKOUT.
Place of Performance
Location: ROLLING MEADOWS, COOK County, ILLINOIS, 60008
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $51.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: UCA LETTER CONTRACT FOR LOW RATE INITIAL PRODUCTION (LRIP) OF THE NEXT GENERATION AUTOMATIC TEST STATION (NGATS)SUBASSEMBLY, A PART OF THE INTEGRATED FAMILY OF TEST EQUIPMENT (IFTE). THE WORK INCLUDES FABRICATION, ASSEMBLY, TESTING, DEMONSTRATIONS, AND DELIVERY OF 16 OF THE PRODU… Key points: 1. Contract awarded for LRIP of NGATS subassemblies, a component of IFTE. 2. Northrop Grumman is the sole contractor for this specific subassembly. 3. The contract carries a firm-fixed-price structure. 4. Spending is concentrated in the Instrument Manufacturing sector.
Value Assessment
Rating: fair
The $51M contract for 16 subassemblies represents a significant investment. Without comparable contract data for the NGATS subassembly, a precise per-unit cost benchmark is difficult to establish, making value assessment challenging.
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 environment.
Taxpayer Impact: The lack of competition for this sole-source award may result in taxpayers paying a premium for the NGATS subassemblies.
Public Impact
Military readiness may be enhanced by the new test equipment. The contract supports advanced manufacturing and testing capabilities. Dependence on a single supplier for critical components raises supply chain risk. Long-term sustainment costs for this new system are yet to be determined.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Potential for cost overruns due to lack of competitive pressure.
- Long-term sustainment and upgrade costs are not detailed.
- Dependency on a single supplier for critical components.
Positive Signals
- Addresses a critical need for next-generation testing equipment.
- Firm-fixed-price contract provides some cost certainty.
- Supports advanced technological capabilities for the military.
Sector Analysis
This contract falls within the Instrument Manufacturing sector, specifically for electrical testing equipment. Spending in this niche area is driven by defense modernization needs, with benchmarks often tied to specific program requirements and technological advancements.
Small Business Impact
There is no indication of small business participation in this specific contract award. The prime contractor, Northrop Grumman, is a large aerospace and defense company.
Oversight & Accountability
The contract was awarded by the Department of the Army. Oversight would typically involve program management offices ensuring adherence to contract terms, delivery schedules, and quality standards.
Related Government Programs
- Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition.
- Lack of price competition may lead to higher costs.
- Dependency on a single supplier.
- Potential for cost growth in future contract phases.
- Limited transparency on market research for sole-source justification.
Tags
instrument-manufacturing-for-measuring-a, department-of-defense, il, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $51.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. UCA LETTER CONTRACT FOR LOW RATE INITIAL PRODUCTION (LRIP) OF THE NEXT GENERATION AUTOMATIC TEST STATION (NGATS)SUBASSEMBLY, A PART OF THE INTEGRATED FAMILY OF TEST EQUIPMENT (IFTE). THE WORK INCLUDES FABRICATION, ASSEMBLY, TESTING, DEMONSTRATIONS, AND DELIVERY OF 16 OF THE PRODUCTION NGATS SUB ASSEMBLIES, AS WELL AS SUPPORT FOR INTEGRATION, INSTALLATION AND CHECKOUT.
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 (Department of the Army).
What is the total obligated amount?
The obligated amount is $51.0 million.
What is the period of performance?
Start: 2009-11-20. End: 2012-06-30.
What is the projected lifecycle cost of the NGATS program, including sustainment and upgrades, beyond this LRIP phase?
The provided data focuses solely on the Low Rate Initial Production (LRIP) phase and does not offer insights into the total lifecycle costs of the Next Generation Automatic Test Station (NGATS) program. A comprehensive lifecycle cost analysis would need to account for sustainment, maintenance, upgrades, training, and eventual disposal of the equipment over its operational lifespan.
Were there any market research efforts conducted to explore potential competitive sources for the NGATS subassembly before the sole-source determination?
The contract was awarded as 'NOT COMPETED,' suggesting a sole-source justification was made. While the data doesn't detail the specific market research, such justifications typically require demonstrating that only one source can meet the requirement, often due to proprietary technology, unique capabilities, or urgent needs. Further investigation into the justification documentation would be needed to confirm the extent of market research.
How does the per-unit cost of these NGATS subassemblies compare to similar or predecessor test equipment, even if not directly comparable?
Direct per-unit cost comparison is challenging due to the 'next-generation' nature of the NGATS subassembly and the sole-source award. Without data on previous generation test equipment costs or alternative solutions, it's difficult to benchmark. The $51M award for 16 units suggests a high per-unit cost, but this could be justified by advanced technology or specialized requirements.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals
Product/Service Code: INSTRUMENTS AND LABORATORY EQPT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W15QKN10R0604
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 600 HICKS RD, ROLLING MEADOWS, IL, 90
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $73,199,631
Exercised Options: $51,022,729
Current Obligation: $51,022,729
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2009-11-20
Current End Date: 2012-06-30
Potential End Date: 2012-06-30 00:00:00
Last Modified: 2012-09-25
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