Army Awards Northrop Grumman $116M for M782 MOFA II Ammunition
Contract Overview
Contract Amount: $116,150,544 ($116.2M)
Contractor: Northrop Grumman Systems Corp
Awarding Agency: Department of Defense
Start Date: 2025-09-30
End Date: 2031-01-31
Contract Duration: 1,949 days
Daily Burn Rate: $59.6K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DELIVERY ORDER FOR THE M782 MOFA II
Place of Performance
Location: KEYSER, MINERAL County, WEST VIRGINIA, 26726
Plain-Language Summary
Department of Defense obligated $116.2 million to NORTHROP GRUMMAN SYSTEMS CORP for work described as: DELIVERY ORDER FOR THE M782 MOFA II Key points: 1. Significant contract value for specialized ammunition manufacturing. 2. Competition method is 'Full and Open', suggesting potential for competitive pricing. 3. Risk is moderate due to long performance period and specialized nature of the product. 4. Sector is Defense, specifically ammunition manufacturing.
Value Assessment
Rating: fair
The contract value of $116.15M over approximately 5.5 years suggests a per-unit cost that needs careful benchmarking against similar ammunition production contracts. Without specific unit details, a precise comparison is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The 'Full and Open Competition' method is positive for price discovery, allowing multiple vendors to bid. This should theoretically lead to a more competitive price compared to sole-source or limited competition.
Taxpayer Impact: The use of full and open competition aims to ensure taxpayer funds are used efficiently by fostering a competitive bidding process for this ammunition requirement.
Public Impact
Ensures supply of critical ammunition for military operations. Supports defense industrial base, though not specifically small businesses in this award. Long-term contract provides stability for production and delivery.
Waste & Efficiency Indicators
Waste Risk Score: 59 / 10
Warning Flags
- Long contract duration (over 5 years) increases risk of cost escalation or obsolescence.
- No small business participation noted, potentially missing opportunities for economic inclusion.
Positive Signals
- Full and open competition is a positive signal for price efficiency.
- Firm fixed price contract shifts cost risk to the contractor.
- Awarded to a known defense contractor with relevant experience.
Sector Analysis
This contract falls within the Defense sector, specifically the manufacturing of ammunition. Spending in this area is critical for national security, and benchmarks are often tied to specific munition types and production volumes.
Small Business Impact
This award does not indicate any specific set-aside for small businesses. While Northrop Grumman is a large prime contractor, the lack of explicit small business participation in the award details warrants further review to ensure subcontracting opportunities are explored.
Oversight & Accountability
The Department of the Army is the procuring agency, with oversight expected through contract management and performance monitoring. The firm fixed price nature of the contract provides a degree of financial accountability.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Long contract duration.
- No explicit small business participation.
- Specialized nature of the product may limit competition.
- Potential for cost escalation over the contract period.
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, wv, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $116.2 million to NORTHROP GRUMMAN SYSTEMS CORP. DELIVERY ORDER FOR THE M782 MOFA II
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $116.2 million.
What is the period of performance?
Start: 2025-09-30. End: 2031-01-31.
What is the projected per-unit cost of the M782 MOFA II ammunition under this contract, and how does it compare to industry benchmarks for similar munitions?
The total contract value is $116,150,544 with an estimated duration of 1949 days (approx. 5.3 years). Without the total quantity of ammunition to be delivered, a precise per-unit cost cannot be calculated. Benchmarking would require comparing this to historical data for the M782 MOFA II or comparable artillery rounds, considering factors like material costs, manufacturing complexity, and inflation over the contract period.
What are the primary risks associated with the long performance period (over 5 years) for ammunition manufacturing, and what mitigation strategies are in place?
Risks include potential material cost fluctuations, technological obsolescence of the ammunition or its components, and contractor performance degradation over an extended period. Mitigation strategies might involve contract clauses for economic price adjustments, periodic technical reviews, and robust performance monitoring by the Army to ensure quality and timely delivery throughout the contract's life.
How effectively does the 'Full and Open Competition' method ensure value for taxpayer money in the procurement of specialized munitions like the M782 MOFA II?
Full and open competition is designed to maximize the number of potential bidders, thereby fostering a competitive environment that should drive down prices and improve overall value. For specialized munitions, its effectiveness depends on the actual number and capability of firms that can realistically compete, ensuring the process doesn't inadvertently exclude qualified sources while still achieving a competitive outcome.
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: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 210 STATE ROUTE 956, ROCKET CENTER, WV, 26726
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: $116,150,544
Exercised Options: $116,150,544
Current Obligation: $116,150,544
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W52P1J22D0025
IDV Type: IDC
Timeline
Start Date: 2025-09-30
Current End Date: 2031-01-31
Potential End Date: 2031-01-31 12:01:00
Last Modified: 2025-09-30
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