DoD's $59.7M Forebody Upgrade Contract Awarded to Raytheon Company
Contract Overview
Contract Amount: $59,681,429 ($59.7M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2010-12-22
End Date: 2015-03-31
Contract Duration: 1,560 days
Daily Burn Rate: $38.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: FOREBODY UPGRADE
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $59.7 million to RAYTHEON COMPANY for work described as: FOREBODY UPGRADE Key points: 1. Significant investment in guided missile technology. 2. Sole-source award to Raytheon Company raises competition concerns. 3. Potential for cost overruns given the 'Other' sector classification. 4. Long contract duration of 1560 days warrants close monitoring.
Value Assessment
Rating: questionable
The contract value of $59.7M for a forebody upgrade is substantial. Without comparable contracts or detailed cost breakdowns, assessing its value against similar procurements is difficult. The lack of competition further clouds the pricing assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating a lack of competitive bidding. This significantly limits price discovery and may lead to higher costs for taxpayers compared to a competed procurement.
Taxpayer Impact: The sole-source nature of this award means taxpayers may have paid a premium due to the absence of competitive pressure to lower prices.
Public Impact
Impacts national defense capabilities through advanced missile technology. Potential for increased defense spending without clear justification for sole-source award. Raytheon Company benefits from a large, non-competitive contract.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of transparency in pricing
- Long contract duration
Positive Signals
- Award to established defense contractor
- Focus on critical defense technology
Sector Analysis
The 'Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing' sector is highly specialized. Benchmarking spending in this niche is challenging, but large sole-source contracts warrant scrutiny to ensure fair pricing and value.
Small Business Impact
This contract was awarded to Raytheon Company, a large business. There is no indication that small businesses were involved as subcontractors or partners in this specific award, missing an opportunity for their participation.
Oversight & Accountability
The sole-source nature of this contract necessitates robust oversight to ensure Raytheon fulfills its obligations and that the pricing remains justified throughout the contract's lifecycle. Accountability for cost and performance is crucial.
Related Government Programs
- Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award lacks competition.
- High contract value without clear benchmarks.
- Long contract duration increases risk.
- Potential for cost overruns.
- No small business participation noted.
Tags
other-guided-missile-and-space-vehicle-p, department-of-defense, ma, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $59.7 million to RAYTHEON COMPANY. FOREBODY UPGRADE
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $59.7 million.
What is the period of performance?
Start: 2010-12-22. End: 2015-03-31.
What specific technical advancements justify the sole-source award and the $59.7M price tag for the forebody upgrade?
The justification for a sole-source award typically rests on unique capabilities or proprietary technology held by a single contractor. For this forebody upgrade, specific technical advancements related to enhanced missile performance, survivability, or targeting capabilities would need to be documented. The $59.7M price would then be assessed against the perceived value of these advancements and the estimated cost of development and production, though without competition, a definitive value assessment is challenging.
What are the primary risks associated with awarding a long-term, sole-source contract for missile components?
The primary risks include inflated costs due to lack of competition, potential for contractor complacency leading to reduced innovation or quality, and vendor lock-in. There's also a risk that the technology could become obsolete during the contract's long duration without opportunities to pivot to newer solutions. Furthermore, the government may lack leverage to negotiate favorable terms or address performance issues effectively.
How does this contract contribute to the overall effectiveness and modernization of the Department of the Army's missile systems?
This contract is intended to enhance the effectiveness of the Army's missile systems by upgrading critical forebody components. The specific nature of the upgrade would determine the extent of modernization, potentially improving range, accuracy, or payload capacity. However, the effectiveness is contingent on the successful execution of the contract and the actual performance improvements realized by the upgraded missiles in operational scenarios.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W31P4Q10R0001
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 350 LOWELL ST, ANDOVER, MA, 01810
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: $59,681,429
Exercised Options: $59,681,429
Current Obligation: $59,681,429
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2010-12-22
Current End Date: 2015-03-31
Potential End Date: 2015-03-31 12:03:00
Last Modified: 2020-07-02
More Contracts from Raytheon Company
- Federal Contract — $5.7B (Department of Defense)
- TEN Fire Units for Qatar — $5.6B (Department of Defense)
- GPS Advanced Control Segment (OCX) Phase B Blocks 1 and 2 — $4.5B (Department of Defense)
- An/Spy-6(v) Hardware Production — $3.3B (Department of Defense)
- Predominant - Patriot UAE — $3.0B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)