Army awards $18.5M for new avionics suite, enhancing ISR capabilities with SATCOM and VHF radio

Contract Overview

Contract Amount: $18,521,627 ($18.5M)

Contractor: Defense Systems and Solutions

Awarding Agency: Department of Defense

Start Date: 2020-09-26

End Date: 2022-12-30

Contract Duration: 825 days

Daily Burn Rate: $22.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: SHALL DESIGN A NEW AVIONICS SUITE CAPABLE OF ISR OPERATIONS WITH THE RECORDING AND DOWNLINK CAPABILITY ON LINE OF SIGHT (LOS) (VHF) RADIO) AND (BLOS) (SATCOM) EQUIPMENT (IAW) THE PC-12 MODERNIZATION SYSTEMS REQUIREMENTS DOCUMENT (SRD).

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35808

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $18.5 million to DEFENSE SYSTEMS AND SOLUTIONS for work described as: SHALL DESIGN A NEW AVIONICS SUITE CAPABLE OF ISR OPERATIONS WITH THE RECORDING AND DOWNLINK CAPABILITY ON LINE OF SIGHT (LOS) (VHF) RADIO) AND (BLOS) (SATCOM) EQUIPMENT (IAW) THE PC-12 MODERNIZATION SYSTEMS REQUIREMENTS DOCUMENT (SRD). Key points: 1. Contract focuses on integrating advanced ISR capabilities, including Line-of-Sight and Beyond-Line-of-Sight communication. 2. The chosen avionics suite aims to modernize existing platforms, improving operational effectiveness. 3. Competition was conducted after exclusion of sources, suggesting specific technical requirements may have limited bidder pool. 4. Contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 5. The contract duration of 825 days indicates a significant development and integration effort. 6. This award falls under 'Other Aircraft Parts and Auxiliary Equipment Manufacturing', a specialized sector.

Value Assessment

Rating: fair

The contract's Cost Plus Fixed Fee structure warrants close monitoring for cost efficiency. While the total award is $18.5 million, the specific value-for-money is difficult to assess without detailed cost breakdowns and performance metrics. Benchmarking against similar avionics modernization programs would be beneficial to understand if the pricing is competitive for the capabilities delivered. The lack of a defined per-unit cost makes direct comparison challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'. This indicates that while the initial intent might have been broader competition, specific technical requirements or existing platform constraints led to a narrowed bidder pool. The exact number of bidders is not provided, but this procurement method suggests that only a limited number of contractors possessed the necessary specialized expertise or technology.

Taxpayer Impact: This limited competition may result in less aggressive pricing for taxpayers compared to a fully open competition, as the potential for price discovery is reduced.

Public Impact

The primary beneficiaries are the U.S. Army personnel who will utilize the enhanced ISR capabilities. The contract delivers a modernized avionics suite, improving intelligence, surveillance, and reconnaissance operations. The geographic impact is primarily within Army operational theaters, enhancing situational awareness. Workforce implications include specialized engineering and integration roles for the contractor and potential training for Army operators.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type introduces inherent risk of cost escalation if not rigorously managed.
Limited competition may reduce price competitiveness and potentially increase costs for taxpayers.
The specific technical requirements for the avionics suite could lead to vendor lock-in or integration challenges with existing systems.

Positive Signals

Focus on advanced ISR capabilities directly supports critical military intelligence gathering.
Modernization of avionics is essential for maintaining technological superiority and operational effectiveness.
The contract addresses specific requirements for both LOS and BLOS communication, enhancing flexibility.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aircraft electronics and systems manufacturing. The market for advanced avionics is highly specialized, driven by stringent military requirements for performance, reliability, and integration. Spending in this area is critical for maintaining a technological edge in defense capabilities. Comparable spending benchmarks would involve other military aircraft modernization programs or the development of new sensor and communication suites for defense applications.

Small Business Impact

The data indicates that small business participation (sb: false) was not a primary consideration for this specific award, nor was it a small business set-aside. This suggests the contract likely went to a larger defense contractor with the specialized capabilities required. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem in this specialized defense manufacturing area.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract would typically involve the Department of the Army's contracting officers and program managers, ensuring adherence to the Statement of Work and managing costs. Transparency is facilitated through contract award databases, but detailed cost performance reports are usually internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Aircraft Modernization Programs
Intelligence, Surveillance, and Reconnaissance (ISR) Systems
Avionics Systems Development
Defense Communication Systems

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage potential cost overruns.
Limited competition may impact price competitiveness and taxpayer value.
Integration complexity of new avionics with existing platforms could pose technical risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.5 million to DEFENSE SYSTEMS AND SOLUTIONS. SHALL DESIGN A NEW AVIONICS SUITE CAPABLE OF ISR OPERATIONS WITH THE RECORDING AND DOWNLINK CAPABILITY ON LINE OF SIGHT (LOS) (VHF) RADIO) AND (BLOS) (SATCOM) EQUIPMENT (IAW) THE PC-12 MODERNIZATION SYSTEMS REQUIREMENTS DOCUMENT (SRD).

Who is the contractor on this award?

The obligated recipient is DEFENSE SYSTEMS AND SOLUTIONS.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $18.5 million.

What is the period of performance?

Start: 2020-09-26. End: 2022-12-30.

What is the track record of Defense Systems and Solutions (DSS) in delivering complex avionics systems for the Department of Defense?

Defense Systems and Solutions (DSS) has a history of providing various defense-related products and services. While specific details on their track record for delivering complex avionics suites comparable to this $18.5 million contract are not immediately available in the provided data, their role as a contractor suggests some level of established capability. Further investigation into DSS's past performance on similar Department of Defense contracts, particularly those involving aircraft modernization, communication systems, or ISR technology, would be necessary to fully assess their suitability and reliability for this specific project. Reviewing past performance evaluations and any reported issues on previous contracts would provide a clearer picture of their capabilities and potential risks.

How does the $18.5 million cost compare to similar avionics suite modernization contracts for the Army or other branches?

Benchmarking the $18.5 million cost against similar avionics suite modernization contracts is challenging without more specific data points on the scope and complexity of those other contracts. However, for a new avionics suite capable of advanced ISR operations with both LOS (VHF) and BLOS (SATCOM) capabilities, $18.5 million appears to be within a reasonable range for a significant modernization effort. Contracts for developing and integrating such advanced systems can easily reach tens of millions of dollars, depending on the platform, the specific technologies required, and the level of customization. Factors like the number of aircraft to be retrofitted, the extent of system integration, and the inclusion of new software development all influence the final cost. A detailed comparison would require analyzing contracts with similar Statement of Work elements and contract types (e.g., CPFF) awarded within the last few years.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for developing a new avionics suite?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract for developing a new avionics suite is the potential for cost overruns. In a CPFF structure, the contractor is reimbursed for all allowable costs plus a negotiated fixed fee representing profit. If the actual costs exceed initial estimates, the government bears the burden of these increased expenses. This can be particularly risky for developmental contracts where the technical challenges and final costs are not fully predictable at the outset. Effective oversight, rigorous cost tracking, and clear definition of allowable costs are crucial to mitigate this risk. The fixed fee, while intended to incentivize efficiency, might not always be sufficient to prevent cost growth if unforeseen technical hurdles arise, potentially leading to scope adjustments or contract modifications.

What is the expected impact of this new avionics suite on the Army's Intelligence, Surveillance, and Reconnaissance (ISR) capabilities?

The new avionics suite is designed to significantly enhance the Army's Intelligence, Surveillance, and Reconnaissance (ISR) capabilities. By integrating advanced systems capable of both Line-of-Sight (LOS) via VHF radio and Beyond-Line-of-Sight (BLOS) via SATCOM, the suite will provide more robust and flexible communication channels for transmitting collected data. This improved connectivity is crucial for real-time situational awareness and rapid decision-making in diverse operational environments. The ability to record and downlink data effectively, regardless of proximity to ground stations, means that intelligence gathered can be disseminated more quickly and reliably to relevant command centers and units. Ultimately, this modernization aims to increase the effectiveness and reach of Army ISR operations, providing a clearer and more timely intelligence picture.

How does the 'full and open competition after exclusion of sources' procurement method affect the potential for innovation and cost savings?

The 'full and open competition after exclusion of sources' procurement method represents a compromise between achieving broad competition and meeting specific technical needs. Initially, the agency likely intended a broader competition but determined that only certain sources could meet the stringent requirements, possibly due to proprietary technology, unique capabilities, or existing system integration needs. While this method still allows for competition among the qualified sources, it inherently limits the pool of potential bidders compared to a truly 'full and open' approach. This limitation can reduce the pressure on bidders to innovate aggressively or offer the lowest possible price, as the competitive landscape is narrower. Consequently, taxpayers might not benefit from the full spectrum of innovation or the most cost-effective solutions that a wider competition could potentially yield. However, it ensures that the selected solution meets critical, specialized requirements.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 631 DISCOVERY DR, HUNTSVILLE, AL, 35806

Business Categories: Alaskan Native Corporation Owned Firm, Category Business, Minority Owned Business, Native American Owned Business, Partnership or Limited Liability Partnership, SBA Certified 8 a Joint Venture, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $18,521,627

Exercised Options: $18,521,627

Current Obligation: $18,521,627

Subaward Activity

Number of Subawards: 11

Total Subaward Amount: $22,636,350

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W58RGZ18D0001

IDV Type: IDC

Timeline