DoD's $63.3M contract for laser image intensifiers awarded to Harris Corporation shows fair value

Contract Overview

Contract Amount: $63,324,198 ($63.3M)

Contractor: Harris Corporation

Awarding Agency: Department of Defense

Start Date: 2007-08-30

End Date: 2011-07-07

Contract Duration: 1,407 days

Daily Burn Rate: $45.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: LASER IMAGE INTENSIFIERS

Place of Performance

Location: ROANOKE, ROANOKE County, VIRGINIA, 24019, UNITED STATES OF AMERICA

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $63.3 million to HARRIS CORPORATION for work described as: LASER IMAGE INTENSIFIERS Key points: 1. The contract represents a significant investment in advanced optical technology for defense applications. 2. Competition dynamics suggest a potentially competitive bidding process, though specific details are limited. 3. Risk indicators appear manageable given the firm-fixed-price structure and established contractor. 4. Performance context is tied to the Department of the Army's operational needs for enhanced imaging. 5. The contract falls within the broader defense sector's spending on specialized electronic and optical equipment. 6. Value for money is assessed as fair, considering the specialized nature of the technology and market benchmarks.

Value Assessment

Rating: fair

The contract's value of approximately $63.3 million over its period of performance suggests a substantial investment. Benchmarking against similar contracts for advanced optical components is challenging due to the specialized nature of laser image intensifiers. However, the firm-fixed-price contract type provides cost certainty. Without detailed cost breakdowns or comparisons to commercial equivalents, a definitive value-for-money assessment is difficult, but the price appears within a reasonable range for high-tech defense procurement.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited. The presence of two bids suggests a degree of competition, which is generally positive for price discovery. However, the specific number of bidders and the nature of the competition (e.g., technical proposals, price negotiations) are not detailed. A robust competitive environment typically leads to better pricing for the government.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a marketplace where contractors vie for the best price and performance, potentially leading to cost savings and higher quality products.

Public Impact

Military personnel in the Department of the Army benefit from enhanced situational awareness and targeting capabilities. The contract delivers advanced laser image intensifier technology crucial for night operations and low-light conditions. Geographic impact is primarily within military operational theaters where these intensifiers are deployed. Workforce implications include specialized manufacturing and engineering roles within Harris Corporation and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for technological obsolescence in a rapidly evolving defense landscape.
Dependence on a single contractor for critical components could pose supply chain risks.
Limited transparency into the specific performance metrics and operational success of the intensifiers.

Positive Signals

Firm-fixed-price contract structure provides cost predictability.
Award to a known entity (Harris Corporation) suggests a degree of established capability.
Full and open competition, even with limited bidders, indicates an effort to secure competitive pricing.

Sector Analysis

The defense sector heavily relies on advanced electronics and optical systems for surveillance, targeting, and communication. Spending in this area is driven by the need for technological superiority and operational effectiveness. Contracts for components like laser image intensifiers are critical for maintaining these capabilities. The market for such specialized defense electronics is often characterized by high barriers to entry, significant R&D investment, and a limited number of qualified suppliers, making competition dynamics unique.

Small Business Impact

This contract does not appear to have a specific small business set-aside. Analysis of subcontracting opportunities for small businesses is not possible with the provided data. The primary awardee, Harris Corporation, is a large defense contractor, suggesting that direct subcontracting opportunities for small businesses may be limited unless specifically mandated or pursued by the prime contractor.

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 the firm-fixed-price contract, requiring delivery of specified goods. Transparency is generally limited for defense procurements of this nature, with details often classified or restricted. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Night Vision Equipment
Optical Instruments
Defense Electronics
Targeting Systems
Military Optics

Risk Flags

Potential for technological obsolescence
Supply chain dependency
Performance verification challenges

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $63.3 million to HARRIS CORPORATION. LASER IMAGE INTENSIFIERS

Who is the contractor on this award?

The obligated recipient is HARRIS 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 $63.3 million.

What is the period of performance?

Start: 2007-08-30. End: 2011-07-07.

What is the historical spending trend for laser image intensifiers by the Department of Defense?

Historical spending on laser image intensifiers by the Department of Defense (DoD) shows a consistent need for this technology, driven by evolving military requirements for enhanced night vision and targeting capabilities. While specific figures for this contract total $63.3 million, broader trends indicate significant, multi-year investments in electro-optical systems. Spending fluctuates based on technological advancements, new program starts, and the lifecycle of existing equipment. The DoD's overall budget for research, development, testing, and evaluation (RDT&E) and procurement of advanced sensors and optics often runs into billions of dollars annually, with components like image intensifiers forming a crucial part of these expenditures. Analyzing past contracts reveals a pattern of awarding such specialized technologies to established defense contractors with proven expertise, often through competitive bidding processes that, while aiming for cost efficiency, reflect the high cost of cutting-edge defense technology.

How does the per-unit cost of these laser image intensifiers compare to industry benchmarks?

Determining the precise per-unit cost for the laser image intensifiers under this $63.3 million contract is not feasible with the provided data, as the total contract value and the number of units procured are not explicitly linked. However, laser image intensifiers are highly specialized, technologically advanced components. Their per-unit cost is significantly influenced by factors such as generation (e.g., Gen 3, Gen 4), specific performance characteristics (e.g., resolution, sensitivity, signal-to-noise ratio), manufacturing complexity, and the scale of production. Given that this contract was awarded to Harris Corporation, a major defense contractor, and involved full and open competition, the pricing is likely reflective of high-performance military-grade equipment. Industry benchmarks for advanced image intensifier tubes can range from several hundred to several thousand dollars per unit, depending heavily on the specifications. Without knowing the exact specifications and quantity, a direct comparison is speculative, but the nature of the technology suggests a premium price point.

What are the primary risks associated with this contract for the government?

The primary risks for the government associated with this contract include potential technological obsolescence, supply chain disruptions, and performance shortfalls. Laser image intensifier technology is subject to rapid advancement; therefore, the procured intensifiers could become outdated relatively quickly, diminishing their long-term operational value. Dependence on a single supplier, even if selected through competition, can create supply chain vulnerabilities, especially in times of geopolitical instability or unforeseen manufacturing issues. Furthermore, there's always a risk that the delivered intensifiers may not meet the stringent performance requirements under all operational conditions, potentially impacting mission success. The firm-fixed-price nature mitigates cost overrun risks but does not eliminate risks related to quality, delivery timeliness, or the ultimate effectiveness of the technology in the field.

What is Harris Corporation's track record with similar defense contracts?

Harris Corporation (now L3Harris Technologies) has a long and extensive track record of successfully delivering advanced electronic systems, including optical and night vision technologies, to the Department of Defense and other government agencies. They are a well-established prime contractor with significant experience in complex defense procurements. Their portfolio includes a wide range of sensor systems, communication equipment, and electronic warfare capabilities. Historically, Harris has demonstrated proficiency in managing large-scale contracts, meeting stringent technical specifications, and adhering to delivery schedules. While specific performance metrics for every contract are not publicly available, their sustained position as a major defense supplier indicates a generally reliable performance history in delivering sophisticated technological solutions that meet military requirements.

How does this contract's value compare to the overall spending on optical instruments by the DoD?

This contract, valued at approximately $63.3 million for laser image intensifiers, represents a specific segment within the Department of Defense's (DoD) broader spending on optical instruments and related technologies. The DoD's annual budget for procurement, research, development, testing, and evaluation (RDT&E) encompasses a vast array of systems, including advanced optics, sensors, targeting pods, reconnaissance equipment, and night vision devices. Total spending on optical instruments and related components across all branches of the military can easily reach billions of dollars annually. Therefore, while $63.3 million is a substantial sum for a single contract, it is a relatively modest portion of the DoD's overall investment in optical technologies. This contract highlights the critical need for specialized components like image intensifiers, which are essential for numerous platforms and mission sets, contributing to the overall complexity and cost of modern military hardware.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Optical Instrument and Lens Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Exelis Inc. (UEI: 969316046)

Address: 7635 PLANTATION RD, ROANOKE, VA, 24019

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $63,324,198

Exercised Options: $63,324,198

Current Obligation: $63,324,198

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9124Q05D0821

IDV Type: IDC

Timeline