DoD's $250M Rockwell Collins contract for broadcasting equipment shows fair value with 4 bidders
Contract Overview
Contract Amount: $250,132,103 ($250.1M)
Contractor: Rockwell Collins, Inc.
Awarding Agency: Department of Defense
Start Date: 2004-06-22
End Date: 2014-12-31
Contract Duration: 3,844 days
Daily Burn Rate: $65.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Other
Place of Performance
Location: CEDAR RAPIDS, LINN County, IOWA, 52498
State: Iowa Government Spending
Plain-Language Summary
Department of Defense obligated $250.1 million to ROCKWELL COLLINS, INC. for work described as: Key points: 1. Contract value appears reasonable given the duration and scope. 2. Competition was robust, suggesting effective price discovery. 3. Risk indicators are low due to firm fixed-price structure. 4. Performance context is within a long-term equipment provision framework. 5. Sector positioning is in defense communications hardware manufacturing.
Value Assessment
Rating: good
The contract's total value of approximately $250 million over more than 10 years suggests a significant investment in critical communication equipment. Benchmarking against similar long-term, high-value defense contracts for specialized electronics, the pricing appears to be within a reasonable range. The firm fixed-price nature of the contract also provides cost certainty, contributing to a good assessment of value for money, assuming the delivered equipment meets performance specifications.
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 bids. With four bidders participating, the level of competition was healthy, which typically drives more competitive pricing and encourages innovation. The presence of multiple bidders suggests that the market for this type of broadcasting and wireless communications equipment is sufficiently developed and that the government had a reasonable selection of qualified vendors.
Taxpayer Impact: The full and open competition with multiple bidders likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition scenario. This competitive process helps ensure that the government is not overpaying for the required equipment.
Public Impact
The Department of Defense, specifically the Air Force, benefits from reliable broadcasting and wireless communications equipment. Services delivered include the manufacturing and provision of specialized electronic equipment. Geographic impact is primarily national, supporting military operations and communications infrastructure. Workforce implications include jobs in manufacturing, engineering, and logistics within the defense industrial base.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (over 10 years) could introduce risks related to technological obsolescence or changing requirements.
- Firm fixed-price contracts can shift risk to the contractor, potentially leading to higher initial bids to cover contingencies.
Positive Signals
- Firm fixed-price contract type provides cost certainty for the government.
- Full and open competition with multiple bidders suggests a competitive market and potentially better pricing.
- The contractor, Rockwell Collins, is a well-established entity in aerospace and defense electronics.
Sector Analysis
The contract falls within the Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing sector, a segment of the broader electronics and defense industrial base. This sector is characterized by high R&D investment, stringent quality requirements, and often long product lifecycles, especially for defense applications. Spending in this area is critical for maintaining secure and effective military communications. Comparable spending benchmarks would involve other large-scale procurements of specialized electronic systems for government use.
Small Business Impact
The data indicates this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. As a large contract awarded to a major defense contractor, the primary focus is likely on the prime contractor's capabilities. However, large prime contractors often engage small businesses for specialized components or services, so there could be indirect subcontracting opportunities, though not a primary driver of this award.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and program management office within the Department of the Air Force. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified equipment. Transparency is generally maintained through contract award databases and reporting requirements. The Inspector General's office within the DoD may conduct audits or investigations if specific concerns regarding performance, cost, or compliance arise.
Related Government Programs
- Defense Communications Systems
- Military Radio and Navigation Equipment
- Wireless Communication Infrastructure
- Broadcasting Equipment Procurement
Risk Flags
- Potential for technological obsolescence due to long contract duration and rapid tech evolution.
- Risk of contractor financial distress if cost escalations are not adequately factored into the fixed price.
- Need for robust government oversight to ensure performance and compliance over the contract's life.
Tags
defense, department-of-defense, rockwell-collins, air-force, definitive-contract, firm-fixed-price, full-and-open-competition, broadcasting-equipment, wireless-communications, manufacturing, long-term-contract, iowa
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $250.1 million to ROCKWELL COLLINS, INC.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is ROCKWELL COLLINS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $250.1 million.
What is the period of performance?
Start: 2004-06-22. End: 2014-12-31.
What is Rockwell Collins' track record with similar DoD contracts?
Rockwell Collins, now part of Collins Aerospace (a Raytheon Technologies company), has a long and extensive history of providing avionics, communication, and electronic systems to the Department of Defense and other government agencies. They have been a significant player in military aircraft upgrades, secure communication systems, and navigation technologies. Analyzing their past performance on similar large-scale, long-duration contracts would involve reviewing contract databases for on-time delivery, adherence to specifications, and any history of disputes or contract modifications. Generally, established contractors like Collins Aerospace have a substantial portfolio of successful contract completions, but specific performance metrics for this particular contract would require deeper analysis of contract performance reports and any associated award or termination data.
How does the per-unit cost of the equipment compare to commercial off-the-shelf (COTS) alternatives?
Directly comparing the per-unit cost of specialized military broadcasting and wireless communications equipment to Commercial Off-The-Shelf (COTS) alternatives is challenging without specific product details. Military-grade equipment often incorporates enhanced security features, ruggedization for harsh environments, extended temperature ranges, and specific interoperability requirements that COTS products typically lack. These specialized features usually command a premium price. If the DoD's requirements could have been met by COTS equipment, the per-unit cost would likely be significantly lower. However, the necessity for military-specific functionalities, such as secure communication protocols or resistance to electronic warfare, often justifies the higher cost of specialized systems. A detailed analysis would require identifying the specific equipment procured and comparing its features and performance against available COTS options.
What are the primary risks associated with a firm fixed-price contract of this duration?
The primary risks associated with a firm fixed-price (FFP) contract, especially one spanning over a decade, include potential cost overruns for the contractor if material or labor costs escalate unexpectedly, and the risk of technological obsolescence for the government. For the contractor, unforeseen increases in manufacturing costs, supply chain disruptions, or inflation could erode profit margins significantly, potentially leading to quality compromises or contractor default if margins become unsustainable. For the government, the risk lies in the equipment becoming outdated before the end of its intended service life due to rapid technological advancements. While FFP provides cost certainty to the government, it can incentivize contractors to bid higher initially to cover perceived risks, and it may limit flexibility if requirements need to evolve during the contract term.
How has spending in the 'Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing' sector evolved for the DoD over the past decade?
Spending by the Department of Defense in the 'Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing' sector (NAICS 334220) has likely seen fluctuations driven by evolving military operational needs, technological advancements, and budget priorities. Over the past decade, there has been a significant push towards modernizing communication systems to ensure secure, resilient, and high-bandwidth capabilities, including satellite communications, tactical networks, and electronic warfare systems. This has likely led to increased investment in advanced wireless and broadcasting equipment. However, budget constraints, shifts in strategic focus (e.g., towards cyber warfare or AI), and the consolidation of defense contractors may have also influenced spending patterns. Analyzing historical spending data would reveal trends in specific sub-categories of equipment and the overall investment in this manufacturing sector by the DoD.
What is the significance of the contract's start date (2004) and end date (2014) in today's technological landscape?
The contract's period of performance, from June 2004 to December 2014, places it firmly in the pre-smartphone era and predates many of the significant advancements in mobile communication, networking, and digital broadcasting technologies that have emerged since. Equipment procured under this contract would have been based on the technological standards and capabilities available in the early 2000s. In today's rapidly evolving technological landscape, such equipment might be considered legacy or nearing the end of its effective service life, particularly if it was intended for cutting-edge applications. The military's reliance on such systems would necessitate careful lifecycle management, potential upgrades, or replacement strategies to maintain operational effectiveness and security against modern threats.
Industry Classification
NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: ALTERNATIVE SOURCES
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 400 COLLINS RD NE, CEDAR RAPIDS, IA, 52498
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $124,752,679
Exercised Options: $124,752,679
Current Obligation: $250,132,103
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2004-06-22
Current End Date: 2014-12-31
Potential End Date: 2014-12-31 00:00:00
Last Modified: 2019-07-01
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