Northrop Grumman awarded $154M contract for Air Defense Reconfigurable Trainer, supporting guided missile manufacturing
Contract Overview
Contract Amount: $15,415,389 ($15.4M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2024-06-28
End Date: 2026-01-27
Contract Duration: 578 days
Daily Burn Rate: $26.7K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: AIR DEFENSE RECONFIGURABLE TRAINER FOR IBCS
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35805
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $15.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: AIR DEFENSE RECONFIGURABLE TRAINER FOR IBCS Key points: 1. Contract value of $154.15 million for a trainer system. 2. Awarded to Northrop Grumman Systems Corporation, a major defense contractor. 3. The contract is for a reconfigurable trainer for the IBCS system. 4. Delivery order with an estimated completion date in January 2026. 5. The contract falls under guided missile and space vehicle manufacturing. 6. Full and open competition was utilized for this award.
Value Assessment
Rating: good
The contract value of $154.15 million for an air defense trainer appears reasonable given the complexity of modern defense systems like IBCS. Benchmarking against similar complex simulation and training systems in the defense sector would provide a more precise value-for-money assessment. However, the use of a Cost Plus Incentive Fee (CPIF) pricing structure suggests an alignment of contractor and government interests in achieving cost efficiencies and performance targets, which can be a positive indicator for value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple potential bidders were allowed to submit proposals. The specific number of bidders is not provided, but the use of full and open competition generally fosters a competitive environment, which can lead to better pricing and innovation. This approach allows the government to select the offer that best meets its technical and cost requirements.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of receiving competitive pricing and ensures that the government is not limited to a single provider, potentially driving down costs through market forces.
Public Impact
The primary beneficiaries are the U.S. Army personnel who will utilize the training system. The contract delivers a reconfigurable trainer essential for the Integrated Battle Command System (IBCS). The training system will enhance the readiness and effectiveness of air defense units. Work is expected to be performed in Alabama, supporting the local economy and workforce in that state. This trainer will contribute to the operational capabilities of guided missile and space vehicle defense systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The CPIF contract type can lead to cost overruns if not carefully managed and monitored.
- Reliance on a single prime contractor, Northrop Grumman, for a critical training system.
- Potential for scope creep if the 'reconfigurable' aspect is not tightly defined.
Positive Signals
- Awarded through full and open competition, suggesting a competitive process.
- The CPIF structure incentivizes both contractor and government to achieve cost and performance goals.
- The trainer system directly supports a critical defense capability (IBCS).
Sector Analysis
The defense training and simulation market is a significant segment within the broader aerospace and defense industry. This contract for the IBCS reconfigurable trainer fits within the specialized area of command and control systems training. The market is characterized by high technological sophistication, long development cycles, and substantial government investment. Comparable spending often involves large-scale simulation platforms, virtual reality training environments, and integrated systems for complex military operations.
Small Business Impact
The provided data indicates that small business participation (sb) is false, and there is no mention of a small business set-aside. This suggests that the contract was not specifically targeted towards small businesses. While Northrop Grumman is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors. However, without specific subcontracting plans or goals detailed in the award, the direct impact on the small business ecosystem is unclear.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Army contracting and program management offices. The Cost Plus Incentive Fee (CPIF) structure necessitates close monitoring of costs and performance to ensure the government receives value. Transparency is typically maintained through contract reporting mechanisms and program reviews. The Inspector General's office may also have jurisdiction for audits and investigations if any irregularities are suspected.
Related Government Programs
- Integrated Battle Command System (IBCS)
- Missile Defense Systems
- Military Training and Simulation
- Guided Missile Manufacturing
- Department of the Army Procurement
Risk Flags
- Cost Overrun Risk (CPIF)
- Scope Creep Risk (Reconfigurable System)
- Technical Complexity Risk (Advanced Simulation)
Tags
defense, department-of-defense, department-of-the-army, northrop-grumman, air-defense, trainer-system, simulation-and-training, full-and-open-competition, cost-plus-incentive-fee, guided-missile-manufacturing, alabama, major-contractor
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. AIR DEFENSE RECONFIGURABLE TRAINER FOR IBCS
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 $15.4 million.
What is the period of performance?
Start: 2024-06-28. End: 2026-01-27.
What is the historical spending trend for similar air defense training systems awarded by the Department of the Army?
Analyzing historical spending for similar air defense training systems by the Department of the Army requires access to detailed contract databases. However, generally, the procurement of advanced training and simulation systems for complex platforms like IBCS represents a significant investment. Spending in this area tends to be cyclical, influenced by modernization programs, threat assessments, and budget allocations. Contracts for such systems can range from tens of millions to hundreds of millions of dollars, depending on the scope, technology, and duration. Factors like full-motion simulators, virtual reality integration, and software development contribute to the overall cost. Without specific historical data points for IBCS trainers, it's difficult to provide precise figures, but the $154 million awarded to Northrop Grumman aligns with the high-end investment typically seen for critical, technologically advanced defense training solutions.
How does the Cost Plus Incentive Fee (CPIF) structure compare to other contract types for defense training systems?
The Cost Plus Incentive Fee (CPIF) contract type is often used for complex development or production efforts where costs are uncertain but can be influenced by performance. In a CPIF contract, the final profit is adjusted based on the contractor's performance against pre-determined targets (e.g., cost, schedule, or technical performance). This differs from fixed-price contracts, where the price is set upfront, offering less flexibility but more cost certainty for the government. It also differs from Cost Plus Fixed Fee (CPFF), where the fee is fixed regardless of cost variations. For defense training systems, CPIF aims to incentivize the contractor to control costs while meeting stringent performance requirements, aligning the interests of both parties. However, it requires robust government oversight to ensure targets are realistic and achievable without compromising quality.
What are the key performance indicators (KPIs) likely being tracked under this CPIF contract for the IBCS trainer?
Under this CPIF contract for the IBCS reconfigurable trainer, key performance indicators (KPIs) would likely focus on several critical areas. Firstly, cost control would be paramount, with targets set for managing expenditures within projected budgets. Performance KPIs would include the successful development, integration, and testing of the trainer system to meet all specified technical requirements for the IBCS. Schedule adherence, ensuring timely delivery of milestones and the final system, would also be a crucial KPI. Furthermore, operational effectiveness KPIs might measure the trainer's fidelity, realism, and ability to accurately simulate various air defense scenarios. User acceptance and feedback from training personnel would also likely be incorporated as performance metrics to ensure the system meets the end-users' needs effectively.
What is Northrop Grumman's track record with developing complex simulation and training systems for the Department of Defense?
Northrop Grumman has a substantial and well-established track record in developing complex simulation and training systems for the Department of Defense across various platforms and domains. They are a major defense contractor with extensive experience in areas such as command and control, aviation simulation, and integrated training environments. Their portfolio includes developing sophisticated simulators for aircraft, ground vehicles, and naval systems, as well as virtual and constructive simulation capabilities. Given their role as a prime contractor on numerous large-scale defense programs, including those involving advanced missile defense and command systems, their experience in delivering complex, integrated training solutions is extensive. This background suggests a strong capability to undertake and successfully execute the IBCS reconfigurable trainer contract.
What are the potential risks associated with the 'reconfigurable' aspect of the trainer system?
The 'reconfigurable' nature of the IBCS trainer introduces specific risks that need careful management. Firstly, defining the scope of reconfigurability can be challenging; if not clearly delineated, it can lead to scope creep, where additional functionalities or configurations are requested beyond the original intent, driving up costs and extending schedules. Secondly, the technical complexity of designing a system that can be easily and reliably reconfigured for multiple scenarios or system upgrades can be significant. This may require advanced software architecture and modular hardware design, increasing development effort and potential for integration issues. Thirdly, ensuring the long-term maintainability and supportability of a highly reconfigurable system requires robust documentation and specialized technical expertise, which could pose sustainment challenges and costs over the system's lifecycle.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W31P4Q20R0015
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 213 WYNN DR, HUNTSVILLE, AL, 35805
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $15,415,389
Exercised Options: $15,415,389
Current Obligation: $15,415,389
Subaward Activity
Number of Subawards: 29
Total Subaward Amount: $1,485,805
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W31P4Q22D0004
IDV Type: IDC
Timeline
Start Date: 2024-06-28
Current End Date: 2026-01-27
Potential End Date: 2026-01-27 12:01:00
Last Modified: 2025-09-10
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