Northrop Grumman awarded $46.1M for Joint Threat Emitter Enhanced Delivery Initiative, with a 5-year performance period

Contract Overview

Contract Amount: $46,134,947 ($46.1M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2019-04-18

End Date: 2021-09-18

Contract Duration: 884 days

Daily Burn Rate: $52.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: INDEFINITE DELIVERY, INDEFINITE QUANTITY CONTRACT IN SUPPORT OF THE JOINT THREAT EMITTER ENHANCED DELIVERY INITIATIVE CONTRACT.

Place of Performance

Location: BUFFALO, ERIE County, NEW YORK, 14221

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $46.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: INDEFINITE DELIVERY, INDEFINITE QUANTITY CONTRACT IN SUPPORT OF THE JOINT THREAT EMITTER ENHANCED DELIVERY INITIATIVE CONTRACT. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 3. Performance period spans 884 days, indicating a medium-term project. 4. The contract is an Indefinite Delivery, Indefinite Quantity (IDIQ) type, allowing for flexible task orders. 5. The primary contractor, Northrop Grumman Systems Corporation, is a major defense contractor. 6. The contract falls under the Manufacturing of Search, Detection, Navigation, Guidance, Aeronautical, and Nautical Systems and Instruments industry.

Value Assessment

Rating: fair

Benchmarking the value of this IDIQ contract is challenging without specific task order details. However, the total awarded amount of $46.1 million over approximately 2.4 years suggests a moderate investment. Comparing it to similar IDIQ contracts for specialized defense systems would provide better context. The firm fixed price structure is generally favorable for the government in managing cost certainty, but the overall value depends on the efficiency and necessity of the delivered items.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The number of bidders is not specified, but this method generally promotes a competitive environment, which can lead to better pricing and innovation. The open competition suggests the government sought the best available solution across the market.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically drives down costs through market forces and ensures the government receives competitive pricing for its procurements.

Public Impact

The primary beneficiaries are likely the Department of Defense, specifically units requiring the Joint Threat Emitter Enhanced Delivery Initiative. The contract supports the development and delivery of advanced threat emitter systems, crucial for training and operational readiness. Geographic impact is likely concentrated within defense installations and operational theaters where these systems are deployed. Workforce implications may include specialized engineering, manufacturing, and technical support roles within Northrop Grumman and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on task orders makes it difficult to assess the true value and necessity of each delivery.
The IDIQ structure, while flexible, can sometimes lead to scope creep if not managed carefully.
Reliance on a single large contractor for specialized systems could present long-term dependency risks.

Positive Signals

Firm Fixed Price contract type helps control costs and shifts risk to the contractor.
Full and open competition suggests a robust market evaluation was conducted.
The contract supports critical defense capabilities, contributing to national security objectives.

Sector Analysis

This contract falls within the Defense sector, specifically the manufacturing of advanced electronic systems. The market for such specialized defense equipment is characterized by high barriers to entry, significant R&D investment, and a limited number of prime contractors. Spending in this sub-sector is driven by evolving threat landscapes and the need for sophisticated simulation and training tools. Comparable spending benchmarks would involve other IDIQ contracts for electronic warfare systems, radar, or simulation equipment.

Small Business Impact

There is no indication of small business set-asides for this contract, nor are there explicit mentions of subcontracting plans for small businesses in the provided data. As a large prime contract awarded to a major defense corporation, the primary focus is likely on the prime contractor's capabilities. The impact on the small business ecosystem would depend on whether Northrop Grumman actively engages small businesses in its supply chain for this specific contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Defense Contract Management Agency (DCMA), responsible for ensuring contractor performance and compliance. Accountability measures are inherent in the Firm Fixed Price contract type, which penalizes the contractor for cost overruns. Transparency is facilitated through contract award databases, though detailed operational specifics of IDIQ orders may be less public.

Related Government Programs

Joint Threat Emitter Systems
Defense Simulation and Training Equipment
Electronic Warfare Systems
Northrop Grumman Defense Contracts

Risk Flags

Potential for cost overruns if task orders are not carefully managed under the IDIQ ceiling.
Reliance on a single prime contractor for specialized systems.
Lack of specific performance metrics in the provided data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $46.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. INDEFINITE DELIVERY, INDEFINITE QUANTITY CONTRACT IN SUPPORT OF THE JOINT THREAT EMITTER ENHANCED DELIVERY INITIATIVE CONTRACT.

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $46.1 million.

What is the period of performance?

Start: 2019-04-18. End: 2021-09-18.

What is the historical spending pattern for the Joint Threat Emitter Enhanced Delivery Initiative contract and similar programs?

Analyzing historical spending for the Joint Threat Emitter Enhanced Delivery Initiative (JTEEDI) contract specifically requires access to detailed order history under this IDIQ. The provided data shows a total award of $46.1 million with a performance period ending in September 2021. Without further data, it's difficult to establish a precise spending pattern (e.g., annual spend rate, peak spending periods). However, for similar programs involving advanced defense simulation and training systems, spending can be highly variable, often tied to specific modernization cycles, training requirements, and geopolitical events. These programs can range from tens to hundreds of millions of dollars over their lifecycle. IDIQ contracts, by nature, allow for fluctuating spending based on government needs, making consistent historical patterns less predictable than fixed-price, single-award contracts. Future spending on JTEEDI or successor programs would depend on continued defense priorities and budget allocations.

How does the pricing of this contract compare to market rates for similar defense systems?

Directly comparing the pricing of this specific IDIQ contract to market rates is challenging without knowing the exact items and quantities ordered under the $46.1 million award. The contract is for 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing,' specifically supporting the Joint Threat Emitter Enhanced Delivery Initiative. The 'Firm Fixed Price' (FFP) nature of the contract means that Northrop Grumman is obligated to perform the work for a set price, shifting cost risk to them. This is generally favorable for the government. However, the 'value for money' depends on the unit prices negotiated for each task order against industry benchmarks for comparable threat emitter systems or related components. Without access to those specific unit prices and a detailed understanding of the system's capabilities and technological sophistication, a precise market rate comparison is not feasible. General market trends for advanced defense electronics suggest high costs due to R&D, specialized manufacturing, and stringent quality requirements.

What are the key performance indicators (KPIs) used to measure the success of this contract?

The provided data does not explicitly list the Key Performance Indicators (KPIs) for this specific Indefinite Delivery, Indefinite Quantity (IDIQ) contract. However, for defense contracts of this nature, typical KPIs often include: Delivery Schedule Adherence (on-time delivery of systems/components), Technical Performance (meeting specified technical requirements and operational capabilities), Quality Assurance (low defect rates, compliance with standards), and Cost Control (adherence to task order budgets, especially relevant if there are cost-reimbursable elements, though this contract is FFP). For an IDIQ contract supporting a 'Joint Threat Emitter Enhanced Delivery Initiative,' KPIs might also focus on the reliability and effectiveness of the threat emitters in simulated training environments, and the ease of integration with existing military platforms. The Defense Contract Management Agency (DCMA) would likely monitor these aspects during performance.

What is Northrop Grumman's track record with similar defense contracts, particularly IDIQs?

Northrop Grumman Systems Corporation is a major, well-established defense contractor with extensive experience in developing and delivering complex systems, including those related to radar, electronic warfare, and simulation technologies, which align with the scope of this contract. They frequently hold large IDIQ contracts across various defense agencies. Their track record generally includes successful execution of large-scale programs, though like any major contractor, they may have faced challenges or scrutiny on specific projects regarding cost, schedule, or performance. Publicly available contract databases often show numerous awards and task orders issued to Northrop Grumman under various IDIQ vehicles. A thorough assessment would involve reviewing specific contract performance reports, past performance evaluations, and any significant disputes or corrective actions associated with their prior IDIQ contracts in similar technology domains.

What are the potential risks associated with the 'full and open competition' award type for this contract?

While 'full and open competition' is generally preferred for maximizing value and innovation, potential risks for this specific contract could include: 1) Increased administrative burden: Managing a large number of potential bidders and proposals can be resource-intensive for the government. 2) Complexity in evaluation: Evaluating diverse technical approaches and pricing structures from multiple competitors can be complex and time-consuming, potentially leading to delays. 3) Lowest price technically acceptable (LPTA) pitfalls: If the evaluation criteria heavily favor the lowest price without sufficiently robust technical assessment, the government might end up with a less capable or reliable system, despite competitive pricing. 4) Contractor viability: Ensuring all bidders have the necessary financial stability and technical capacity to execute complex defense contracts is crucial, and thorough vetting is required. For this IDIQ contract, the risk is mitigated by the FFP structure, which places cost responsibility on the contractor.

How does the 'Indefinite Delivery, Indefinite Quantity' (IDIQ) contract structure impact program flexibility and cost control?

The IDIQ contract structure provides significant flexibility by allowing the government to order specific quantities of supplies or services up to a maximum contract value over a defined period. This is advantageous for programs like the Joint Threat Emitter Enhanced Delivery Initiative where future needs might be uncertain or evolve. It enables rapid procurement of necessary items without needing to establish a new contract for each requirement. However, this flexibility can pose challenges for cost control. Without clearly defined quantities upfront, it can be harder to forecast total spending accurately. Effective management requires diligent oversight of task orders to ensure they align with the program's objectives and budget constraints. The 'Firm Fixed Price' (FFP) nature of the task orders under this IDIQ helps mitigate cost overruns at the individual order level, but the overall ceiling still needs careful monitoring to prevent exceeding the maximum award amount.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 1740 WEHRLE DR, BUFFALO, NY, 14221

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: $46,134,947

Exercised Options: $46,134,947

Current Obligation: $46,134,947

Actual Outlays: $4,416,256

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA821019D0001

IDV Type: IDC

Timeline