DoD Awards $28.6M for Gray Eagle UAS Support, Extending Contract Through 2026

Contract Overview

Contract Amount: $28,602,009 ($28.6M)

Contractor: General Atomics Aeronautical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2025-02-26

End Date: 2026-04-27

Contract Duration: 425 days

Daily Burn Rate: $67.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: GRAY EAGLE TECHNICAL SERVICES (GETS) FY24-28 FOLLOW ON CONTRACT FOR GRAY EAGLE UNCREWED AIRCRAFT SYSTEMS.

Place of Performance

Location: POWAY, SAN DIEGO County, CALIFORNIA, 92064

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $28.6 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC. for work described as: GRAY EAGLE TECHNICAL SERVICES (GETS) FY24-28 FOLLOW ON CONTRACT FOR GRAY EAGLE UNCREWED AIRCRAFT SYSTEMS. Key points: 1. Contract focuses on sustainment and support for the Gray Eagle Uncrewed Aircraft System. 2. Sole source award to General Atomics Aeronautical Systems, Inc., the original equipment manufacturer. 3. Potential for increased costs due to lack of competition. 4. The contract falls within the Aircraft Manufacturing sector.

Value Assessment

Rating: fair

The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. The awarded amount of $28.6M for a 425-day period needs further analysis against similar sustainment contracts for UAS.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, awarded sole-source to the original manufacturer. This limits price discovery and potentially leads to higher costs for the government.

Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for sustainment services that could potentially be obtained at a lower cost through a competitive process.

Public Impact

Ensures continued operational readiness of critical Gray Eagle UAS. Supports ongoing intelligence, surveillance, and reconnaissance (ISR) missions. Potential impact on future procurement strategies for UAS sustainment. Affects the Army's ability to maintain its uncrewed aerial fleet.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition.
Cost Plus Fixed Fee contract type carries inherent cost risk.
Limited duration may necessitate future sole-source awards.

Positive Signals

Ensures continued support for critical ISR capabilities.
Maintains operational readiness of existing Gray Eagle fleet.

Sector Analysis

This contract is within the Aircraft Manufacturing sector, specifically supporting uncrewed aerial systems. Benchmarks for UAS sustainment contracts vary widely based on system complexity and age.

Small Business Impact

No small business participation is indicated in the provided data. Future contracts should explore opportunities for small businesses in the UAS sustainment ecosystem.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential cost creep. Robust performance monitoring will be crucial.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Lack of competition
Cost Plus Fixed Fee contract type
Potential for vendor lock-in
Limited duration may lead to future sole-source awards

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.6 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC.. GRAY EAGLE TECHNICAL SERVICES (GETS) FY24-28 FOLLOW ON CONTRACT FOR GRAY EAGLE UNCREWED AIRCRAFT SYSTEMS.

Who is the contractor on this award?

The obligated recipient is GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $28.6 million.

What is the period of performance?

Start: 2025-02-26. End: 2026-04-27.

What is the historical cost performance of previous Gray Eagle sustainment contracts awarded to General Atomics Aeronautical Systems, Inc.?

Analyzing historical cost data from prior Gray Eagle sustainment contracts is crucial for assessing the value of this follow-on award. Understanding past cost trends, any cost overruns, and the effectiveness of previous oversight mechanisms will provide a baseline for evaluating the current $28.6M contract. This historical perspective is key to determining if the current pricing is reasonable and if the government is receiving good value.

What are the specific risks associated with relying on a sole-source provider for critical UAS sustainment?

The primary risk of a sole-source award is the lack of competitive pressure, which can lead to inflated prices and reduced innovation. It also creates vendor lock-in, making it difficult and potentially more expensive to switch providers in the future. Furthermore, the government's leverage in negotiations is diminished, potentially impacting contract terms and service levels.

How effectively does the Gray Eagle UAS fulfill its intended ISR missions, and does this contract adequately support that effectiveness?

The Gray Eagle UAS is designed for persistent intelligence, surveillance, and reconnaissance (ISR) missions. This contract's focus on sustainment and technical support is critical for ensuring the platform remains operational and effective in the field. Adequate funding and timely support directly contribute to the system's ability to perform its intended missions, thereby maintaining the effectiveness of ISR capabilities.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - GENERAL

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 14200 KIRKHAM WAY, POWAY, CA, 92064

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: $28,602,009

Exercised Options: $28,602,009

Current Obligation: $28,602,009

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W58RGZ24D0038

IDV Type: IDC

Timeline