DoD Awards Raytheon $206M for Digital Side Lobe Canceller Kits Amidst Limited Competition
Contract Overview
Contract Amount: $206,013,540 ($206.0M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2019-02-28
End Date: 2024-12-31
Contract Duration: 2,133 days
Daily Burn Rate: $96.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: DIGITAL SIDE LOBE CANCELLER (DSLC) AND PERIPHERAL ENHANCEMENT ASSEMBLY (PEA) BOX MODIFICATION KITS, INSTALLATION KITS AND INITIAL FIELDING SPARES
Place of Performance
Location: ANDOVER, ESSEX County, MASSACHUSETTS, 01810
Plain-Language Summary
Department of Defense obligated $206.0 million to RAYTHEON COMPANY for work described as: DIGITAL SIDE LOBE CANCELLER (DSLC) AND PERIPHERAL ENHANCEMENT ASSEMBLY (PEA) BOX MODIFICATION KITS, INSTALLATION KITS AND INITIAL FIELDING SPARES Key points: 1. Significant contract value of $206M for specialized defense components. 2. Raytheon Company is the sole awardee, indicating limited competition. 3. Potential risks associated with single-source procurement and long-term sustainment. 4. Spending falls within the Guided Missile and Space Vehicle Manufacturing sector.
Value Assessment
Rating: fair
The contract's fixed-price incentive structure aims to control costs, but the lack of competition makes direct price comparisons difficult. The total award value of $206M for modification kits and spares suggests a substantial investment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, suggesting a sole-source award to Raytheon Company. This limits price discovery and potentially increases costs compared to a competitive environment.
Taxpayer Impact: The lack of competition may result in higher costs for taxpayers, as there was no market pressure to drive down prices.
Public Impact
Ensures operational readiness of critical missile systems. Supports advanced electronic warfare capabilities for the U.S. Army. Potential for long-term sustainment and upgrade contracts with Raytheon.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition.
- Long contract duration (2019-2024) may lead to cost overruns.
- Reliance on a single vendor for critical components.
Positive Signals
- Addresses a specific, potentially unique technological need.
- Fixed-price incentive contract aims for cost control.
- Supports critical defense systems and readiness.
Sector Analysis
This contract falls under the Guided Missile and Space Vehicle Manufacturing sector, a specialized area within defense. Spending benchmarks for similar sole-source modification kits are difficult to establish without competitive data.
Small Business Impact
The data indicates no specific set-aside for small businesses. The prime contractor, Raytheon Company, is a large defense corporation, suggesting limited direct opportunities for small businesses on this specific contract.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and performance. The Department of the Army's contracting activity should monitor contract modifications and delivery schedules diligently.
Related Government Programs
- Guided Missile and Space Vehicle Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award
- Lack of price competition
- Potential for cost overruns
- Long contract duration
- Vendor lock-in risk
Tags
guided-missile-and-space-vehicle-manufac, department-of-defense, ma, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $206.0 million to RAYTHEON COMPANY. DIGITAL SIDE LOBE CANCELLER (DSLC) AND PERIPHERAL ENHANCEMENT ASSEMBLY (PEA) BOX MODIFICATION KITS, INSTALLATION KITS AND INITIAL FIELDING SPARES
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 $206.0 million.
What is the period of performance?
Start: 2019-02-28. End: 2024-12-31.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one vendor can fulfill the requirement. The Department of Defense should have documented the specific reasons why this contract was not competed and explored if any limited competition or other procurement methods could have been employed to achieve better value.
How does the per-unit cost of these modification kits compare to similar systems or previous procurements, if available?
Without competitive bids, establishing a precise benchmark is challenging. However, analysts can compare the total contract value against the number of units or the complexity of the modifications. If historical data exists for similar upgrades or if independent cost estimates are available, they can be used to assess reasonableness, though direct comparisons are inherently limited in sole-source scenarios.
What are the long-term implications for sustainment and future upgrades given the sole-source nature of this contract?
A sole-source award can create vendor lock-in, potentially leading to higher sustainment and upgrade costs over the system's lifecycle. The government may have less leverage in negotiating future contracts. It is crucial to ensure that the current contract includes provisions for future supportability and that the government has access to necessary technical data to potentially introduce competition later.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W31P4Q18R0079
Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
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: $230,466,410
Exercised Options: $206,013,540
Current Obligation: $206,013,540
Subaward Activity
Number of Subawards: 1333
Total Subaward Amount: $365,057,842
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2019-02-28
Current End Date: 2024-12-31
Potential End Date: 2024-12-31 12:12:00
Last Modified: 2024-01-19
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)