DoD awards $53.6M for Stinger flight motors, facing limited competition and potential cost concerns

Contract Overview

Contract Amount: $53,620,030 ($53.6M)

Contractor: Aerojet Rocketdyne Inc

Awarding Agency: Department of Defense

Start Date: 2020-01-30

End Date: 2025-06-30

Contract Duration: 1,978 days

Daily Burn Rate: $27.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: STINGER FLIGHT MOTORS INCREASE

Place of Performance

Location: CAMDEN, OUACHITA County, ARKANSAS, 71701

State: Arkansas Government Spending

Plain-Language Summary

Department of Defense obligated $53.6 million to AEROJET ROCKETDYNE INC for work described as: STINGER FLIGHT MOTORS INCREASE Key points: 1. Contract awarded to a single supplier, raising questions about price competitiveness. 2. Long-term contract duration suggests potential for sustained pricing pressure. 3. Limited competition may hinder innovation and drive up costs. 4. High value contract for critical defense components warrants close performance monitoring. 5. Focus on propulsion units indicates a key area of defense spending. 6. Geographic concentration in Arkansas for this critical component.

Value Assessment

Rating: questionable

The contract value of $53.6 million for Stinger flight motors is significant. Without comparable contract data or a competitive bidding process, it is difficult to definitively benchmark the value for money. The firm fixed-price structure provides some cost certainty, but the lack of competition raises concerns that the pricing may not reflect the best possible value for taxpayers. Further analysis of historical pricing for similar components or alternative propulsion systems would be needed to provide a more robust assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Aerojet Rocketdyne Inc., was considered. This approach is typically used when only one responsible source is available or when there is a compelling justification for excluding competition. The lack of multiple bidders means there was no opportunity for price discovery through a competitive process, potentially leading to higher costs than if multiple firms had vied for the contract.

Taxpayer Impact: Sole-source awards limit the government's ability to negotiate the lowest possible price, potentially resulting in taxpayer funds being used less efficiently. This contract's value suggests a significant portion of taxpayer money is committed without the benefit of competitive pressure.

Public Impact

The U.S. Army benefits from the continued supply of critical Stinger missile flight motors. This contract ensures the availability of essential components for air defense systems. The primary geographic impact is in Arkansas, where the contractor is located. Workforce implications are likely concentrated at Aerojet Rocketdyne's facilities in Arkansas.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially inflates costs.
Long contract duration (2020-2025) may reduce flexibility and increase long-term price risk.
Lack of transparency in the sole-source justification process.
Dependence on a single supplier for a critical defense component creates supply chain vulnerability.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Contract ensures continued production of vital Stinger missile components.
Awardee is an established defense contractor with relevant expertise.

Sector Analysis

The manufacturing of guided missile and space vehicle propulsion units is a specialized segment within the aerospace and defense industry. This sector is characterized by high barriers to entry due to complex technology, stringent quality requirements, and significant capital investment. Spending in this area is driven by national security needs and technological advancements in defense systems. Comparable spending benchmarks are difficult to establish without more specific data on propulsion unit costs across different missile platforms.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Given the specialized nature of missile propulsion systems, it is unlikely that small businesses would be primary manufacturers. However, Aerojet Rocketdyne Inc. may engage small businesses as subcontractors for specific components or services, though this is not explicitly detailed in the provided data. The absence of a small business set-aside means opportunities for smaller firms in this specific contract are limited.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and program management offices. The firm fixed-price nature provides some level of cost control. Transparency is limited due to the sole-source award. Accountability measures would involve performance monitoring against contract requirements and delivery schedules. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Stinger Missile Production
Air Defense Systems
Missile Propulsion Manufacturing
Department of the Army Procurement

Risk Flags

Sole Source Award
Potential for Cost Overruns
Supply Chain Dependency
Lack of Competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $53.6 million to AEROJET ROCKETDYNE INC. STINGER FLIGHT MOTORS INCREASE

Who is the contractor on this award?

The obligated recipient is AEROJET ROCKETDYNE 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 $53.6 million.

What is the period of performance?

Start: 2020-01-30. End: 2025-06-30.

What is the historical spending trend for Stinger flight motors?

Historical spending data for Stinger flight motors is not directly available in the provided snippet. However, the current contract awarded in 2020 and ending in 2025 with a value of $53.6 million suggests a significant and ongoing investment in this component. To understand historical trends, one would need to access procurement databases for previous contracts related to Stinger missile production, looking at contract awards, quantities, and pricing over several years. This would reveal if spending has increased, decreased, or remained stable, and whether the current award represents a continuation of prior investment levels or a new surge in demand.

How does the per-unit cost of these Stinger flight motors compare to similar defense propulsion systems?

A direct per-unit cost comparison for these Stinger flight motors is not possible with the provided data, as the total contract value and the number of units are not specified. Furthermore, 'similar defense propulsion systems' is a broad category. To make a meaningful comparison, one would need to identify specific propulsion units for comparable missile systems (e.g., other man-portable air-defense systems or short-range missiles) and obtain their per-unit costs from publicly available contract awards. Factors such as technological complexity, size, thrust requirements, and production volume significantly influence per-unit costs, making direct comparisons challenging even for seemingly similar components.

What are the specific risks associated with a sole-source award for critical defense components like Stinger flight motors?

The primary risks associated with a sole-source award for critical defense components like Stinger flight motors include lack of price competition, potential for cost overruns, reduced incentive for contractor efficiency, and supply chain vulnerability. Without competing bids, the government may pay a premium for the component. A single supplier also means that any production issues, quality control problems, or business disruptions faced by that contractor can directly impact the availability of the critical component, potentially jeopardizing national security readiness. Furthermore, the government has less leverage to negotiate favorable terms or drive innovation.

What is the track record of Aerojet Rocketdyne Inc. in delivering defense propulsion systems?

Aerojet Rocketdyne Inc. has a long-standing and extensive track record in the defense industry, specializing in rocket propulsion systems for various applications, including missiles and space launch vehicles. They have been a key supplier for numerous U.S. military programs. Their experience encompasses the design, development, and manufacturing of advanced propulsion technologies. While specific performance metrics for this particular Stinger flight motor contract are not detailed here, the company's history suggests a high level of technical expertise and capability in producing complex propulsion units. However, like many large defense contractors, they may have faced scrutiny or challenges on specific programs over their history.

How does the $53.6 million contract value compare to the overall budget for Stinger missile procurement or maintenance?

The provided data does not include the overall budget for Stinger missile procurement or maintenance, making a direct comparison of the $53.6 million contract value difficult. This figure represents the funding allocated specifically for Stinger flight motors over the contract period (2020-2025). To assess its significance, one would need to research the total annual or multi-year budgets allocated by the Department of Defense or the Army for the Stinger program. This would help determine if the flight motor component represents a major cost driver within the overall program, or a relatively smaller but essential expenditure.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing

Product/Service Code: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 14160 W AR 274 HWY, CAMDEN, AR, 71701

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: $53,620,030

Exercised Options: $53,620,030

Current Obligation: $53,620,030

Subaward Activity

Number of Subawards: 29

Total Subaward Amount: $19,999,303

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W31P4Q18D0027

IDV Type: IDC

Timeline