DoD awards $12.6M to Northrop Grumman for Long Range Radar System support

Contract Overview

Contract Amount: $12,606,882 ($12.6M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2025-08-16

End Date: 2026-08-15

Contract Duration: 364 days

Daily Burn Rate: $34.6K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: PROVIDE ENGINEERING SUPPORT, PRODUCT SUPPORT, AND CONTRACTOR LOGISTICAL SUPPORT FOR THE LONG RANGE RADAR SYSTEM.

Place of Performance

Location: LINTHICUM HEIGHTS, ANNE ARUNDEL County, MARYLAND, 21090

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $12.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: PROVIDE ENGINEERING SUPPORT, PRODUCT SUPPORT, AND CONTRACTOR LOGISTICAL SUPPORT FOR THE LONG RANGE RADAR SYSTEM. Key points: 1. Contract focuses on essential engineering, product, and logistical support for a critical radar system. 2. Sole-source award raises questions about potential cost efficiencies and market alternatives. 3. Contract duration of one year suggests a need for ongoing, specialized support. 4. The contractor, Northrop Grumman, is a major defense industry player with extensive experience. 5. The specific NAICS code (334511) points to a specialized manufacturing and support sector. 6. The contract type (Cost Plus Fixed Fee) requires careful monitoring of costs to ensure value.

Value Assessment

Rating: fair

The contract value of $12.6 million for one year of support for a specialized radar system appears within a reasonable range for complex defense systems. However, without detailed cost breakdowns or comparisons to similar support contracts for comparable systems, a definitive value-for-money assessment is challenging. The Cost Plus Fixed Fee structure necessitates close oversight to manage costs effectively and ensure the fixed fee remains appropriate for the effort expended. Benchmarking against industry standards for similar logistical and engineering support would provide a clearer picture of pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. While this can ensure specialized expertise, it limits the potential for price competition, which could lead to higher costs for the government compared to a fully competed contract. The absence of a competitive bidding process means that the government did not benefit from multiple offers to drive down prices.

Taxpayer Impact: The sole-source nature of this award means taxpayers may not be receiving the most competitive pricing available in the market. Without competition, there is less pressure on the contractor to offer cost savings.

Public Impact

The Department of the Army benefits from continued operational readiness of its Long Range Radar System. This contract ensures the availability of critical engineering, product, and logistical support services. The geographic impact is primarily within the operational domain of the U.S. Army, potentially worldwide. The contract supports specialized technical roles within Northrop Grumman, maintaining a skilled workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Cost Plus Fixed Fee contract type requires robust government oversight to control costs.
Lack of competition may reduce incentives for contractor innovation in cost reduction.

Positive Signals

Contractor (Northrop Grumman) is a reputable defense firm with proven experience in radar systems.
Focus on essential support services ensures continued operational capability of critical defense assets.
Contract duration provides stability for necessary long-term system maintenance and upgrades.

Sector Analysis

The defense sector, particularly within system and instrument manufacturing (NAICS 334511), is characterized by high barriers to entry, significant R&D investment, and long product lifecycles. Contracts for specialized support, like that for the Long Range Radar System, are crucial for maintaining the operational effectiveness of advanced military equipment. Spending in this area is often driven by national security requirements and technological advancements. Comparable spending benchmarks are difficult to establish precisely due to the unique nature of defense systems, but multi-million dollar contracts for sustainment and support are common for major platforms.

Small Business Impact

This contract does not appear to include a small business set-aside. Given the sole-source nature and the specialized expertise required, it is unlikely that subcontracting opportunities for small businesses would be mandated or significant, unless specifically incorporated by the prime contractor. This could limit the direct benefit to the small business defense contracting ecosystem for this particular award.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract will likely be managed by the Department of the Army contracting and program management offices. Accountability measures will focus on performance metrics, cost tracking, and adherence to the contract terms. Transparency may be limited due to the sole-source nature and the sensitive defense context, but contract awards and basic details are typically reported in federal procurement databases.

Related Government Programs

Long Range Radar Systems
Defense Logistics Support
Northrop Grumman Defense Contracts
Army Radar Modernization

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Potential for cost overruns
Limited price competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.6 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. PROVIDE ENGINEERING SUPPORT, PRODUCT SUPPORT, AND CONTRACTOR LOGISTICAL SUPPORT FOR THE LONG RANGE RADAR SYSTEM.

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 $12.6 million.

What is the period of performance?

Start: 2025-08-16. End: 2026-08-15.

What is Northrop Grumman's track record with similar Long Range Radar System support contracts?

Northrop Grumman has a significant history of providing complex systems and support for defense applications, including radar technology. While specific details on prior contracts for this exact 'Long Range Radar System' may be proprietary or require deeper database analysis, the company is a prime contractor for numerous advanced radar platforms and associated sustainment services across various military branches. Their extensive experience in aerospace and defense manufacturing suggests a strong capability to fulfill the engineering, product, and logistical support requirements outlined in this award. Past performance evaluations, if publicly available through federal procurement data, would offer more granular insights into their reliability and effectiveness in similar roles.

How does the $12.6 million contract value compare to similar radar system support contracts?

Benchmarking this $12.6 million contract value against similar radar system support contracts is challenging without access to detailed cost data and specific system comparisons. However, for a one-year duration supporting a critical, likely complex, long-range radar system, this figure appears within the expected range for specialized defense sustainment. Contracts for major defense platforms can range from millions to billions over their lifecycle. Factors influencing cost include the system's complexity, required technical expertise, geographic scope of support, and the specific services (engineering, logistics, product support) included. A sole-source award, as in this case, inherently limits direct price comparisons to competitive bids.

What are the primary risks associated with this sole-source, Cost Plus Fixed Fee contract?

The primary risks associated with this sole-source, Cost Plus Fixed Fee (CPFF) contract are related to cost control and potential lack of competitive pressure. Since the contract was not competed, there's a risk that the government is not achieving the most favorable pricing. The CPFF structure, while allowing flexibility for unforeseen technical challenges, inherently shifts some cost risk to the government. Without robust oversight and detailed cost tracking, there's a risk of cost overruns beyond the initial estimate, as the contractor is reimbursed for allowable costs plus a fixed fee. Additionally, the sole-source nature might reduce the contractor's incentive to aggressively seek cost-saving efficiencies compared to a fixed-price or competitively awarded contract.

How effective is Northrop Grumman likely to be in providing the specified support?

Northrop Grumman is a major defense contractor with extensive experience in developing, manufacturing, and supporting complex systems, including radar technology. Their established infrastructure, technical expertise, and history of working with the Department of Defense suggest a high likelihood of effective performance. The company typically invests heavily in engineering talent and logistical capabilities necessary for such contracts. While effectiveness is ultimately measured by performance against contract requirements, Northrop Grumman's position as a leading defense prime contractor indicates a strong capacity to meet the engineering, product, and logistical support needs for the Long Range Radar System.

What are the historical spending patterns for Long Range Radar System support by the Department of Defense?

Historical spending patterns for Long Range Radar System support by the Department of Defense are not readily available in a consolidated public format due to the specific nature of the system and the classification of defense budgets. However, it is understood that the sustainment and modernization of critical defense assets like advanced radar systems represent a significant and ongoing investment. Such spending typically occurs over the lifecycle of the system, encompassing maintenance, upgrades, spare parts, and technical support. Annual expenditures can fluctuate based on system readiness requirements, technological obsolescence, and strategic priorities. The $12.6 million awarded here represents a portion of this broader, long-term investment in radar capabilities.

What are the implications of the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' NAICS code for this contract?

The NAICS code 334511, 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing,' signifies that this contract falls within a highly specialized segment of the manufacturing and defense industry. Companies operating under this code are involved in the design, development, and production of sophisticated electronic systems used for locating, tracking, and navigating. This implies that the Long Range Radar System is a complex piece of technology requiring specialized engineering knowledge, precise manufacturing standards, and advanced logistical support. Contracts within this sector often involve significant R&D, long production cycles, and require contractors with deep technical expertise and robust quality control processes.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 1580B W NURSERY RD, LINTHICUM HEIGHTS, MD, 21090

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: $51,651,380

Exercised Options: $12,606,882

Current Obligation: $12,606,882

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56KGY20D0012

IDV Type: IDC

Timeline