DoD awards $93.4M contract for ammunition, with Northrop Grumman as prime, to support SAWS
Contract Overview
Contract Amount: $93,441,270 ($93.4M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2024-09-27
End Date: 2025-12-28
Contract Duration: 457 days
Daily Burn Rate: $204.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: PROCURE AMMUNITION TO SUPPORT SAWS
Place of Performance
Location: RADFORD, RADFORD CITY County, VIRGINIA, 24141
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $93.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: PROCURE AMMUNITION TO SUPPORT SAWS Key points: 1. Contract value of $93.4M represents significant investment in critical defense supplies. 2. Full and open competition suggests a robust bidding process for this requirement. 3. Fixed-price contract type aims to control costs and provide predictability. 4. Delivery order structure indicates a need for timely, phased delivery of ammunition. 5. Contract duration of 457 days suggests a medium-term supply need. 6. Northrop Grumman's selection highlights its established role in defense manufacturing.
Value Assessment
Rating: good
The contract value of $93.4M for ammunition manufacturing appears reasonable given the scale and nature of defense procurement. Benchmarking against similar large-scale ammunition contracts would provide a more precise value-for-money assessment. The firm fixed-price structure is generally favorable for the government in managing cost certainty. However, without specific details on the types and quantities of ammunition, a definitive comparison to market rates or similar contracts is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This approach typically fosters a competitive environment, encouraging multiple bidders to offer their best pricing and technical solutions. The number of bidders is not specified, but the method itself suggests a strong potential for price discovery and achieving a fair market price.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining the best value and competitive pricing for essential defense materiel.
Public Impact
The Department of the Army benefits from a secured supply of critical ammunition. This contract supports the sustainment of operations for the SAWS (Soldier as a Weapon System) program. The geographic impact is primarily within the United States, where manufacturing and delivery will occur. The contract supports jobs within the defense manufacturing sector, particularly at Northrop Grumman and its supply chain.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for price escalation if raw material costs increase significantly over the contract period.
- Dependence on a single prime contractor for a critical defense commodity.
- Ensuring timely delivery to meet operational tempo requirements for SAWS.
Positive Signals
- Firm fixed-price contract helps mitigate cost overrun risks for the government.
- Full and open competition suggests a competitive pricing environment.
- Northrop Grumman is an established defense contractor with a track record in manufacturing.
Sector Analysis
This contract falls within the Ammunition (except Small Arms) Manufacturing sector, a critical component of the broader defense industrial base. The market for defense-related manufacturing is characterized by high barriers to entry, specialized technology, and significant government oversight. Spending in this sector is driven by national security requirements and geopolitical factors. Comparable spending benchmarks would involve analyzing historical procurement data for similar ammunition types and quantities by the Department of Defense.
Small Business Impact
The data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While Northrop Grumman is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting will depend on Northrop Grumman's procurement practices and the specific components or services required for ammunition production.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Army's contracting and program management offices. Accountability measures are embedded in the firm fixed-price contract type, which incentivizes the contractor to meet specifications and delivery schedules within the agreed-upon price. Transparency is generally maintained through contract award announcements and reporting requirements, though specific production details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Department of Defense Ammunition Procurement
- Northrop Grumman Defense Contracts
- SAWS Program Support
- Ammunition Manufacturing Services
Risk Flags
- Potential supply chain vulnerabilities for raw materials.
- Ensuring consistent quality control across all manufactured lots.
- Meeting delivery schedules to support operational readiness.
Tags
defense, department-of-defense, department-of-the-army, ammunition, manufacturing, northrop-grumman, full-and-open-competition, firm-fixed-price, delivery-order, virginia, large-business
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $93.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. PROCURE AMMUNITION TO SUPPORT SAWS
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 $93.4 million.
What is the period of performance?
Start: 2024-09-27. End: 2025-12-28.
What specific types and quantities of ammunition are being procured under this contract?
The provided data indicates the contract is for 'PROCURE AMMUNITION TO SUPPORT SAWS' and falls under the NAICS code 332993 (Ammunition (except Small Arms) Manufacturing). However, the specific types and quantities of ammunition are not detailed in the summary data. This information is crucial for a comprehensive understanding of the contract's scope, value, and strategic importance. Detailed specifications would typically be found in the contract's statement of work or technical exhibits, which are not publicly available in this abbreviated format. Understanding the specific munitions procured would allow for better benchmarking against market prices and assessing the criticality of the supply chain.
How does the $93.4M contract value compare to historical spending on similar ammunition procurements by the Department of the Army?
Benchmarking the $93.4M contract value against historical spending requires access to detailed procurement databases and analysis of similar contracts awarded by the Department of the Army for ammunition supporting the SAWS program or comparable systems. Without specific details on the types and quantities of ammunition, a direct comparison is difficult. However, $93.4 million represents a substantial investment, suggesting a significant quantity or high-value specialized munitions. Analysis of past contracts for large-scale ammunition procurement would reveal trends in pricing, volume, and contractor performance, providing context for the current award's value proposition and potential for cost savings or overruns.
What is Northrop Grumman's track record in fulfilling large-scale ammunition manufacturing contracts for the Department of Defense?
Northrop Grumman Systems Corporation is a major defense contractor with extensive experience in various defense manufacturing areas. While specific details on their ammunition manufacturing track record for the Department of Defense (DoD) are not provided here, their status as a prime contractor on a $93.4M award suggests a demonstrated capability. Historically, large defense firms like Northrop Grumman have been involved in producing a wide range of munitions. Assessing their past performance would involve reviewing contract histories, on-time delivery rates, quality control metrics, and any past performance issues or awards related to ammunition production for the DoD. Their selection indicates a perceived ability to meet the demanding requirements of this contract.
What are the key performance indicators (KPIs) and risk mitigation strategies associated with this ammunition supply contract?
Key performance indicators for this contract would likely include on-time delivery of specified ammunition quantities, adherence to quality standards (e.g., defect rates, performance specifications), and compliance with safety regulations during manufacturing and transport. Risk mitigation strategies are inherent in the firm fixed-price contract type, which places the cost risk on the contractor. Additional measures may involve detailed inspection and acceptance procedures, robust quality assurance programs by the contractor, and contingency planning for supply chain disruptions or production delays. The Department of the Army's program management office would oversee these aspects to ensure mission readiness.
How does the 'Delivery Order' (aw) contract type impact the overall program execution and taxpayer value compared to a multi-year fixed-price contract?
A 'Delivery Order' (aw) structure, often used within a larger indefinite-delivery/indefinite-quantity (IDIQ) or a basic ordering agreement framework, allows the government to order specific quantities of goods or services as needed over a defined period. For this $93.4M contract, it implies that the total value is allocated, but the actual procurement and delivery will happen through individual orders placed against it. This provides flexibility for the government to adjust quantities based on evolving needs, potentially optimizing taxpayer value by avoiding over-procurement. However, it can also lead to less predictable spending patterns compared to a fully defined multi-year contract. The firm fixed-price nature of these delivery orders helps maintain cost control for each specific order placed.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 415 CONSTITUTION RD BLDG 229, RADFORD, VA, 24141
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: $93,441,270
Exercised Options: $93,441,270
Current Obligation: $93,441,270
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $1,544,000
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NOT OBTAINED - WAIVED
Parent Contract
Parent Award PIID: W52P1J22D0006
IDV Type: IDC
Timeline
Start Date: 2024-09-27
Current End Date: 2025-12-28
Potential End Date: 2025-12-28 12:12:00
Last Modified: 2025-09-24
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