DoD awards $106M for ATIRCM LRUs, a sole-source contract to BAE Systems

Contract Overview

Contract Amount: $106,030,944 ($106.0M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2008-09-26

End Date: 2010-11-30

Contract Duration: 795 days

Daily Burn Rate: $133.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: JAM HEAD CONTROL UNITS AND IR JAM HEADS - ATIRCM LRUS

Place of Performance

Location: NASHUA, HILLSBOROUGH County, NEW HAMPSHIRE, 03060

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $106.0 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: JAM HEAD CONTROL UNITS AND IR JAM HEADS - ATIRCM LRUS Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. The contract covers a critical component for aircraft survivability. 3. Long-term contract duration suggests sustained need for these units. 4. No small business set-aside was utilized. 5. The award was made by the Department of the Army. 6. The North American Industry Classification System code indicates manufacturing of wireless communications equipment.

Value Assessment

Rating: questionable

Without competitive bidding, it is difficult to definitively assess value for money. The $106 million awarded over the contract period represents a significant investment. Benchmarking against similar sole-source procurements for advanced electronic warfare systems would be necessary to determine if the pricing is reasonable. The lack of competition inherently raises concerns about potential overpricing compared to a fully competed scenario.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, BAE Systems Information and Electronic Systems Integration Inc., was solicited. This approach is typically used when a unique capability or proprietary technology is required, or when only one responsible source can provide the necessary supplies or services. The absence of multiple bidders means there was no direct price competition to drive down costs.

Taxpayer Impact: Taxpayers may not have received the best possible price due to the lack of competitive pressure. Sole-source awards can lead to higher costs than if multiple companies had vied for the contract.

Public Impact

The primary beneficiaries are the U.S. Army aviation units that will operate aircraft equipped with the ATIRCM system. The contract delivers critical Infrared (IR) Jam Head Control Units and IR Jam Heads, essential for protecting aircraft from missile threats. The geographic impact is primarily within Army aviation operations, which are deployed globally. The contract supports specialized manufacturing jobs within the defense electronics sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially increases cost to taxpayers.
Lack of transparency in pricing due to no competitive bidding.
Long contract duration without clear performance benchmarks could mask inefficiencies.

Positive Signals

Provides critical defense technology for aircraft survivability.
Awarded to a known defense contractor with established expertise in electronic warfare systems.
Contract addresses a specific, high-priority military need.

Sector Analysis

This contract falls within the defense electronics manufacturing sector, specifically related to electronic warfare and countermeasures. The market for such specialized components is often concentrated among a few key defense contractors due to high barriers to entry, including technological expertise, security clearances, and established relationships with government agencies. Spending in this niche is driven by evolving threat landscapes and the need for advanced protection systems for military platforms.

Small Business Impact

This contract did not include a small business set-aside, nor is there information indicating subcontracting opportunities for small businesses. The nature of specialized defense electronics manufacturing often favors larger, established prime contractors. Without specific subcontracting plans mandated, the direct impact on the small business ecosystem for this particular award is likely minimal.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are inherent in firm-fixed-price contracts, which place the cost risk on the contractor. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Aircraft Survivability Equipment
Electronic Warfare Systems
Missile Defense Systems
Department of the Army Procurement

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $106.0 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. JAM HEAD CONTROL UNITS AND IR JAM HEADS - ATIRCM LRUS

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION 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 $106.0 million.

What is the period of performance?

Start: 2008-09-26. End: 2010-11-30.

What is the track record of BAE Systems in delivering similar electronic warfare components?

BAE Systems Information and Electronic Systems Integration Inc. has a long-standing reputation and extensive experience in developing and manufacturing advanced electronic warfare (EW) systems, including countermeasures and threat detection technologies for military platforms. They are a major defense contractor with a significant portfolio in this area. Their track record includes numerous contracts for similar complex systems, often involving integrated solutions for aircraft, ground vehicles, and naval vessels. While specific performance metrics for past contracts are not detailed here, their continued success in securing large sole-source and competitive awards in the EW domain suggests a generally positive performance history and strong technical capabilities recognized by the Department of Defense.

How does the pricing of this contract compare to similar sole-source procurements for EW systems?

Directly comparing the pricing of this $106 million sole-source contract for ATIRCM LRUs to other similar procurements is challenging without access to detailed cost breakdowns and specific system functionalities of comparable contracts. Sole-source awards inherently lack the price discovery mechanism of competition. However, the Department of Defense typically conducts extensive price analyses, including should-cost and will-cost estimates, even for sole-source buys, to ensure reasonableness. Benchmarking would involve looking at contracts for other advanced missile warning and countermeasure systems, considering factors like technological sophistication, production volume, and contractor overhead. Given the specialized nature of EW components, costs can be significantly higher than COTS (Commercial Off-The-Shelf) items.

What are the primary risks associated with a sole-source award for critical defense components like ATIRCM LRUs?

The primary risk associated with a sole-source award for critical defense components like ATIRCM LRUs is the potential for inflated costs due to the absence of competitive pressure. Without multiple bidders vying for the contract, the contractor may have less incentive to offer the lowest possible price. Another risk is vendor lock-in, where the government becomes dependent on a single supplier, potentially limiting future flexibility and innovation. Furthermore, a sole-source award can reduce transparency in the procurement process, making it harder to scrutinize pricing and ensure optimal value for taxpayer money. There's also a risk if the sole-source provider experiences production issues or financial instability, as there are no immediate alternative suppliers.

How effective is the ATIRCM system in enhancing aircraft survivability, and what is its operational context?

The Advanced Threat Infrared Countermeasures (ATIRCM) system is designed to significantly enhance aircraft survivability by detecting incoming infrared-guided missiles and employing countermeasures to defeat them. It typically integrates with other aircraft defensive systems. The system's effectiveness is crucial for aircraft operating in contested environments where they are vulnerable to man-portable air-defense systems (MANPADS) and other IR-seeking threats. The ATIRCM LRUs (Large Replacement Units) procured under this contract are essential components that enable the system's functionality. Its operational context is primarily within military aviation, particularly for helicopters and fixed-wing aircraft that frequently operate at lower altitudes or in high-threat areas, thereby increasing their survivability and mission success rates.

What has been the historical spending trend for ATIRCM components or similar systems by the Department of the Army?

Historical spending on ATIRCM components and similar advanced countermeasures by the Department of the Army has been substantial, reflecting the ongoing need to protect aviation assets against evolving threats. While specific figures for ATIRCM alone over many years are not provided in this data snippet, the Department of Defense as a whole invests billions annually in aircraft survivability equipment (ASE) and electronic warfare systems. The Army, operating a large fleet of helicopters and fixed-wing aircraft, is a major procurer of such technologies. The duration of this contract (2008-2010) and its value suggest a sustained program requirement. Past spending patterns for similar systems indicate a consistent demand driven by operational necessity and technological upgrades.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 65 SPIT BROOK ROAD, NASHUA, NH, 02

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $106,030,944

Exercised Options: $106,030,944

Current Obligation: $106,030,944

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W15P7T04D0055

IDV Type: IDC

Timeline