DoD's $167M R&D Contract with Eaton Corporation Faces Scrutiny Over Competition and Value
Contract Overview
Contract Amount: $16,701,285 ($16.7M)
Contractor: Eaton Corporation
Awarding Agency: Department of Defense
Start Date: 2022-07-05
End Date: 2027-07-04
Contract Duration: 1,825 days
Daily Burn Rate: $9.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 999
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: RESEARCH AND DEVELOPMENT EFFORT PROPOSED IN RESPONSE TO BROAD AGENCY ANNOUNCEMENT (BAA) W911NF-17-S-0003
Place of Performance
Location: MENOMONEE FALLS, WAUKESHA County, WISCONSIN, 53051
Plain-Language Summary
Department of Defense obligated $16.7 million to EATON CORPORATION for work described as: RESEARCH AND DEVELOPMENT EFFORT PROPOSED IN RESPONSE TO BROAD AGENCY ANNOUNCEMENT (BAA) W911NF-17-S-0003 Key points: 1. Eaton Corporation awarded a significant $167M contract for R&D in physical, engineering, and life sciences. 2. The contract was awarded under Full and Open Competition, suggesting a competitive bidding process. 3. Concerns arise regarding the Cost Plus Fixed Fee (CPFF) structure and its potential impact on cost control. 4. The R&D focus is within a broad scientific category, requiring careful oversight to ensure alignment with defense objectives.
Value Assessment
Rating: questionable
The Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not managed tightly. Benchmarking against similar R&D contracts is difficult without specific deliverables, but the fee structure warrants close monitoring.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under Full and Open Competition, indicating multiple bidders were considered. However, the CPFF structure might incentivize cost increases, potentially diminishing the price discovery benefits of competition.
Taxpayer Impact: Taxpayer funds are being used for advanced R&D. While innovation is crucial, the CPFF structure necessitates robust oversight to ensure efficient use of funds and prevent unnecessary costs.
Public Impact
Potential for technological advancements in physical, engineering, and life sciences. Investment in research could lead to future defense capabilities. Contract duration of five years allows for sustained research efforts. Geographic location in Wisconsin may impact regional economic development.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee structure
- Long contract duration
- Broad R&D scope
Positive Signals
- Full and Open Competition
- Awarded to established corporation
- Supports critical R&D
Sector Analysis
This contract falls under Research and Development in the Physical, Engineering, and Life Sciences (NAICS 541715). Spending in this sector is vital for national security and technological advancement, often characterized by high costs and long development cycles.
Small Business Impact
The data indicates this contract was not set aside for small businesses (sb: false) and was awarded to Eaton Corporation, a large business. There is no direct indication of small business participation within this specific contract award.
Oversight & Accountability
The Department of the Army's oversight will be critical, especially given the CPFF contract type. Regular reviews of progress, cost expenditures, and adherence to the BAA's objectives are essential for accountability.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Potential for cost overruns due to CPFF structure
- Broad R&D scope may lack specific focus
- Long contract duration could lead to scope creep
- Limited insight into specific deliverables and success metrics
Tags
research-and-development-in-the-physical, department-of-defense, wi, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.7 million to EATON CORPORATION. RESEARCH AND DEVELOPMENT EFFORT PROPOSED IN RESPONSE TO BROAD AGENCY ANNOUNCEMENT (BAA) W911NF-17-S-0003
Who is the contractor on this award?
The obligated recipient is EATON 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 $16.7 million.
What is the period of performance?
Start: 2022-07-05. End: 2027-07-04.
What specific R&D objectives does this contract aim to achieve, and how do they align with current defense priorities?
The contract responds to Broad Agency Announcement (BAA) W911NF-17-S-0003, which typically solicits innovative research proposals. While the specific objectives aren't detailed here, they likely pertain to advancements sought by the Department of the Army in physical, engineering, or life sciences that could enhance military capabilities or address emerging threats.
How will the Cost Plus Fixed Fee structure be managed to mitigate risks of cost overruns and ensure value for taxpayer money?
Effective management of a CPFF contract requires stringent oversight. This includes detailed cost tracking, regular performance reviews, and clear milestones. The government must ensure the fixed fee remains appropriate for the effort and that Eaton Corporation is incentivized to control costs without compromising research quality or scope.
What mechanisms are in place to assess the effectiveness and impact of the R&D outcomes beyond the contract's completion?
Effectiveness assessment will likely involve technical reviews and demonstrations of prototypes or research findings. Beyond the contract, impact is measured by the successful transition of developed technologies into operational systems or further research. The Army will track the utility and adoption of the R&D results.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › General Science and Technology R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: BASIC RESEARCH
Solicitation ID: W911NF17S0003
Offers Received: 999
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Eaton Corporation Public Limited Company
Address: W126N7250 FLINT DR, MENOMONEE FALLS, WI, 53051
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $16,701,285
Exercised Options: $16,701,285
Current Obligation: $16,701,285
Subaward Activity
Number of Subawards: 12
Total Subaward Amount: $3,341,942
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2022-07-05
Current End Date: 2027-07-04
Potential End Date: 2027-07-04 00:00:00
Last Modified: 2025-07-07
More Contracts from Eaton Corporation
- FY-08 1ST Quarter Funding — $29.7M (Department of Transportation)
- UPS, Generators and Chiller Replacement — $22.1M (Department of Defense)
- TAS::36 0158::TAS Installation of a Turn-Key Solar Photovoltaic (PV) System AT the Albuqueque VA Healthcare System Located in Albuquerque, NM — $19.4M (Department of Veterans Affairs)
- Firm Fixed Price - Recurring Services — $8.1M (Department of Defense)
- Contractor Depot Logistics Support (cdls) to Provide Depot Level Repair, Sparing, Full Maintenance and Engineering Support — $7.8M (Department of Transportation)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)