DoD's $179M E-2D Hawkeye Training System contract awarded to Rockwell Collins, raising value-for-money questions

Contract Overview

Contract Amount: $178,985,137 ($179.0M)

Contractor: Rockwell Collins Simulation & Training Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2008-08-18

End Date: 2016-06-29

Contract Duration: 2,872 days

Daily Burn Rate: $62.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Defense

Official Description: E-2D ADVANCED HAWKEYE INTEGRATED TRAINING SYSTEM FOR AIRCREW.

Place of Performance

Location: CEDAR RAPIDS, LINN County, IOWA, 52498

State: Iowa Government Spending

Plain-Language Summary

Department of Defense obligated $179.0 million to ROCKWELL COLLINS SIMULATION & TRAINING SOLUTIONS LLC for work described as: E-2D ADVANCED HAWKEYE INTEGRATED TRAINING SYSTEM FOR AIRCREW. Key points: 1. The contract's cost-plus-incentive-fee structure may incentivize higher spending without guaranteed performance gains. 2. Limited public data on performance metrics makes it difficult to assess the true value delivered. 3. The duration of the contract (2872 days) suggests a long-term commitment with potential for cost overruns. 4. The specific training system's role in enhancing aircrew readiness for the E-2D Hawkeye is critical for naval aviation. 5. Benchmarking this contract against similar simulation and training systems is challenging due to unique platform integration.

Value Assessment

Rating: questionable

The $179 million awarded over nearly 8 years for the E-2D Hawkeye Integrated Training System presents a significant investment. While specific performance benchmarks are not publicly detailed, the cost-plus-incentive-fee (CPIF) contract type suggests that costs could escalate if not carefully managed. Comparing this to other complex simulation and training systems is difficult without more granular data on system capabilities and delivery outcomes. The lack of readily available performance metrics makes a definitive value-for-money assessment challenging, but the CPIF structure warrants scrutiny for potential cost inefficiencies.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to compete. The presence of 3 bidders suggests a reasonably competitive environment, which typically helps in achieving fair market prices. However, the specific nature of advanced aviation training systems can limit the pool of qualified bidders, potentially impacting the intensity of competition.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages competitive pricing. The fact that three entities bid suggests that the government likely received a competitive offer, though the exact price savings compared to a sole-source award are not quantifiable without further analysis.

Public Impact

Naval aviators operating the E-2D Advanced Hawkeye aircraft benefit from enhanced training capabilities. The contract supports the development and sustainment of a critical integrated training system for aircrew. Geographic impact is primarily centered around the contractor's facilities and naval air stations where training is conducted. Workforce implications include skilled jobs in simulation, software development, engineering, and training instruction.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-incentive-fee contract type can lead to cost overruns if not managed stringently.
Lack of detailed public performance metrics hinders objective assessment of value for money.
Long contract duration increases exposure to potential scope creep and evolving technological needs.
The specialized nature of the training system may limit future flexibility or interoperability with other platforms.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
The E-2D Hawkeye is a critical asset for naval intelligence, surveillance, and reconnaissance, making effective training essential.
The contract supports the sustainment of a key defense capability, contributing to national security.
Rockwell Collins has a significant history in simulation and training, suggesting relevant expertise.

Sector Analysis

The aerospace and defense industry is characterized by high R&D costs, long product lifecycles, and significant government procurement. This contract falls within the simulation and training sub-sector, which is crucial for maintaining pilot proficiency and mission readiness for complex aircraft like the E-2D Hawkeye. The market for defense simulation and training is substantial, driven by the need for cost-effective alternatives to live training and the increasing complexity of modern military platforms. Comparable spending benchmarks are difficult to establish precisely due to the unique integration requirements of specific aircraft systems.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, the primary impact on small businesses would be through potential subcontracting opportunities. Rockwell Collins, as the prime contractor, would determine the extent of small business participation in its supply chain. Without specific subcontracting plans or data, it's difficult to assess the direct impact on the small business ecosystem, though large prime contracts often involve a network of smaller suppliers.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contract management agencies, such as the Defense Contract Management Agency (DCMA). The CPIF contract type necessitates close monitoring of costs and performance to ensure the government receives value. Accountability measures are embedded within the contract's incentive structure, linking contractor profit to performance outcomes. Transparency is limited by the proprietary nature of defense contracts and the specific details of the training system, though contract award data is publicly available.

Related Government Programs

E-2D Hawkeye Aircraft Procurement
Naval Aviation Training Programs
Defense Simulation and Training Systems
Aircrew Readiness Initiatives

Risk Flags

Cost-plus-incentive-fee contract type requires robust oversight to prevent cost overruns.
Lack of detailed public performance data makes value assessment difficult.
Long contract duration increases risk of scope creep and technological obsolescence.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $179.0 million to ROCKWELL COLLINS SIMULATION & TRAINING SOLUTIONS LLC. E-2D ADVANCED HAWKEYE INTEGRATED TRAINING SYSTEM FOR AIRCREW.

Who is the contractor on this award?

The obligated recipient is ROCKWELL COLLINS SIMULATION & TRAINING SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $179.0 million.

What is the period of performance?

Start: 2008-08-18. End: 2016-06-29.

What is Rockwell Collins' track record with similar large-scale defense simulation and training contracts?

Rockwell Collins, now part of Collins Aerospace (a Raytheon Technologies company), has a long-standing history in developing advanced simulation and training solutions for various military platforms. They have been involved in numerous contracts for flight simulators, mission rehearsal systems, and integrated training environments for aircraft like the C-130, B-1 bomber, and various fighter jets. Their experience typically includes developing complex hardware and software, ensuring high fidelity simulation, and meeting stringent military performance requirements. While specific details of past CPIF contracts and their outcomes are often not public, their sustained presence in the market suggests a generally positive track record in delivering complex training systems. However, the scale and specific integration needs of the E-2D Hawkeye system represent a significant undertaking, even for an experienced contractor.

How does the cost-plus-incentive-fee (CPIF) structure compare to other contract types for this kind of service, and what are the implications for value?

Cost-plus-incentive-fee (CPIF) contracts are used when the government cannot precisely define the costs or performance required, but wants to incentivize the contractor to control costs and meet targets. In a CPIF contract, the final profit is adjusted based on whether the final costs are above or below a target cost, and whether performance meets or exceeds targets. Compared to fixed-price contracts, CPIF offers more flexibility for complex, evolving projects but carries a higher risk of cost overruns if not managed diligently. For a long-term, technology-intensive program like an integrated training system, CPIF can be appropriate to encourage innovation and adaptation. However, it places a greater burden on government oversight to ensure the contractor is efficiently managing resources and achieving desired performance outcomes to realize true value for taxpayer money.

What are the key performance indicators (KPIs) for this training system, and how is performance measured?

Specific Key Performance Indicators (KPIs) and detailed performance measurement methodologies for the E-2D Advanced Hawkeye Integrated Training System are typically considered sensitive program information and are not publicly disclosed. Generally, for such systems, KPIs would likely include metrics related to simulator fidelity (how accurately it replicates the real aircraft's flight and sensor characteristics), training effectiveness (measured through aircrew performance improvements and mission success rates), system availability and reliability (uptime percentages), and adherence to training objectives. The 'incentive' portion of the CPIF contract suggests that achieving specific, predefined performance targets would result in higher profit for the contractor, implying that these targets are measurable and critical to the system's success.

What is the historical spending trend for E-2D Hawkeye training systems, and how does this contract fit within that pattern?

Historical spending data specifically for the E-2D Hawkeye Integrated Training System prior to this award is not readily available in the provided data. However, the E-2D Hawkeye program itself has seen significant investment over many years, reflecting the complexity and strategic importance of this advanced airborne early warning and control aircraft. This $179 million contract, awarded in 2008 and running until 2016, represents a substantial, long-term investment in ensuring the readiness of E-2D aircrews. It is likely part of a broader, ongoing effort to equip and sustain the E-2D fleet, indicating a consistent commitment to training infrastructure for this platform within the Department of Defense's overall aviation spending.

Are there any identified risks associated with the contractor, Rockwell Collins, or the specific technology involved in this training system?

While Rockwell Collins (now part of Collins Aerospace) has extensive experience, potential risks are inherent in any large, complex defense contract. Risks associated with the contractor could include potential financial instability (though less likely for a major defense supplier), past performance issues on other contracts (which would be reviewed during competition), or challenges in retaining key personnel. For the technology itself, risks might involve integration challenges with the E-2D aircraft systems, cybersecurity vulnerabilities within the training software, the potential for obsolescence over the system's long lifecycle, or difficulties in achieving the required level of simulation fidelity. The CPIF contract structure implicitly acknowledges some level of risk, as it allows for cost adjustments based on performance and cost outcomes.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6133907R0011

Offers Received: 3

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rockwell Collins, Inc. (UEI: 962960589)

Address: 22626 SALLY RIDE DRIVE, STERLING, VA, 20164

Business Categories: Category Business, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $202,516,766

Exercised Options: $179,271,598

Current Obligation: $178,985,137

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6133903D5007

IDV Type: IDC

Timeline