DoD's $183M contract for RCS/C5ISR systems engineering awarded to BAE Systems, supporting Navy surface combatants

Contract Overview

Contract Amount: $183,062,214 ($183.1M)

Contractor: BAE Systems Technology Solutions & Services Inc.

Awarding Agency: Department of Defense

Start Date: 2014-08-01

End Date: 2020-05-31

Contract Duration: 2,130 days

Daily Burn Rate: $85.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: THE NAVAL AIR WARFARE CENTER AIRCRAFT DIVISION (NAWC-AD) PATUXENT RIVER, MD IS TASKED BY NUMEROUS DEPARTMENT OF DEFENSE ORGANIZATIONS TO PROVIDE ENGINEERING AND TECHNICAL EFFORTS TO SUPPORT THE PRODUCTION, LIFETIME SUPPORT ENGINEERING (LSE) AND IN-SERVICE ENGINEERING (ISE) FOR RADIO COMMUNICATION SYSTEM/COMMAND, CONTROL, COMMUNICATIONS, COMPUTERS, COMBAT SYSTEMS, INTELLIGENCE, SURVEILLANCE, AND RECONNAISSANCE (RCS/C5ISR) SYSTEMS ON BOARD NAVY SURFACE COMBATANTS AND AT ASSOCIATED SHORE SITES.

Place of Performance

Location: PATUXENT RIVER, SAINT MARYS County, MARYLAND, 20670

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $183.1 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC. for work described as: THE NAVAL AIR WARFARE CENTER AIRCRAFT DIVISION (NAWC-AD) PATUXENT RIVER, MD IS TASKED BY NUMEROUS DEPARTMENT OF DEFENSE ORGANIZATIONS TO PROVIDE ENGINEERING AND TECHNICAL EFFORTS TO SUPPORT THE PRODUCTION, LIFETIME SUPPORT ENGINEERING (LSE) AND IN-SERVICE ENGINEERING (ISE) FOR RA… Key points: 1. Contract supports critical engineering and technical efforts for Radio Communication Systems/Command, Control, Communications, Computers, Combat Systems, Intelligence, Surveillance, and Reconnaissance (RCS/C5ISR) systems. 2. Services are essential for the production, lifetime support, and in-service engineering of these complex systems. 3. The contract's duration of 2130 days indicates a long-term commitment to ongoing support and development. 4. The award to BAE Systems suggests a reliance on established expertise in advanced defense technology. 5. The scope of work spans both naval surface combatants and associated shore sites, highlighting broad applicability. 6. This contract is a significant component of the Department of the Navy's broader C5ISR modernization efforts.

Value Assessment

Rating: good

The total award amount of $183,062,213.76 over approximately 5.8 years suggests a substantial investment in engineering services. Benchmarking this against similar large-scale defense engineering contracts is challenging without more granular data on specific deliverables. However, the Cost Plus Fixed Fee (CPFF) contract type implies that costs are monitored, but there's potential for cost overruns if not managed tightly. The value appears reasonable given the complexity and critical nature of C5ISR systems for naval operations.

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 had the opportunity to submit proposals. The data does not specify the number of bidders, but full and open competition generally fosters a more competitive environment, potentially leading to better pricing and innovation. This approach aligns with federal acquisition regulations aimed at maximizing value and minimizing the risk of non-competitive pricing.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices and a wider array of innovative solutions being considered. This process helps ensure that government funds are used efficiently by driving down costs and improving the quality of services received.

Public Impact

Naval surface combatants and their crews benefit from enhanced communication and combat systems reliability. Shore-based command and control facilities receive critical engineering support, improving operational readiness. The contract supports the technological advancement of the U.S. Navy's C5ISR capabilities. A portion of the contract value likely flows down to a workforce skilled in specialized engineering and technical fields. The geographic impact is primarily focused on naval operations and associated shore installations globally.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to cost overruns if not meticulously managed and overseen.
The long duration of the contract may present challenges in adapting to rapidly evolving C5ISR technologies.
Reliance on a single contractor for such a critical system could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
BAE Systems is a major defense contractor with a proven track record in complex systems integration.
The contract addresses essential engineering and support for vital naval communication and combat systems.

Sector Analysis

This contract falls within the Defense sector, specifically supporting the development and sustainment of Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance (C5ISR) systems. The market for C5ISR solutions is highly specialized, dominated by large defense contractors capable of handling complex integration and long-term support. Spending in this area is driven by the need for technological superiority and operational effectiveness in modern warfare. Comparable spending benchmarks would involve analyzing other large-scale engineering and technical support contracts for naval or joint-force C5ISR platforms.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large prime contract awarded to BAE Systems, it is likely that subcontracting opportunities may exist for small businesses specializing in specific components or services related to RCS/C5ISR systems. However, the extent of small business participation is not detailed in this data.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy and the Naval Air Warfare Center Aircraft Division (NAWC-AD). As a Cost Plus Fixed Fee contract, rigorous financial oversight is expected to monitor expenditures against the fixed fee and ensure compliance with cost accounting standards. Transparency is typically managed through contract reporting requirements and performance reviews. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval C5ISR Modernization Programs
Surface Combatant Systems Engineering
Radio Communication Systems Support
Intelligence, Surveillance, and Reconnaissance (ISR) Platforms
Defense Engineering Services Contracts

Risk Flags

Potential for cost overruns in CPFF contracts.
Risk of technological obsolescence in C5ISR systems.
Dependency on a single contractor for critical systems support.
Complexity of supporting systems across multiple geographic locations (ships and shore sites).

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $183.1 million to BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC.. THE NAVAL AIR WARFARE CENTER AIRCRAFT DIVISION (NAWC-AD) PATUXENT RIVER, MD IS TASKED BY NUMEROUS DEPARTMENT OF DEFENSE ORGANIZATIONS TO PROVIDE ENGINEERING AND TECHNICAL EFFORTS TO SUPPORT THE PRODUCTION, LIFETIME SUPPORT ENGINEERING (LSE) AND IN-SERVICE ENGINEERING (ISE) FOR RADIO COMMUNICATION SYSTEM/COMMAND, CONTROL, COMMUNICATIONS, COMPUTERS, COMBAT SYSTEMS, INTELLIGENCE, SURVEILLANCE, AND RECONNAISSANCE (RCS/C5ISR) SYSTEMS ON BOARD NAVY SURFACE COMBATANTS AND AT ASSOCIATED SHORE SITES.

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TECHNOLOGY SOLUTIONS & SERVICES INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $183.1 million.

What is the period of performance?

Start: 2014-08-01. End: 2020-05-31.

What is the historical spending trend for RCS/C5ISR engineering services by the Department of the Navy?

Analyzing historical spending trends for RCS/C5ISR engineering services by the Department of the Navy requires access to comprehensive contract databases and budget reports. Generally, spending in this area has been consistently high and is often driven by modernization efforts, platform upgrades, and the need to maintain technological superiority. Factors such as geopolitical events, evolving threats, and advancements in technology significantly influence these spending patterns. The $183 million awarded to BAE Systems represents a significant, but not necessarily unprecedented, investment within this category. Without specific historical data points, it's difficult to ascertain if this contract represents an increase or decrease in the overall trend, but it underscores the ongoing importance and substantial resource allocation dedicated to these critical systems.

How does the performance of BAE Systems on similar contracts compare to industry benchmarks?

Assessing BAE Systems' performance on similar contracts requires a detailed review of past performance evaluations, contract close-out reports, and any documented disputes or awards. BAE Systems is a major defense contractor with extensive experience in C5ISR systems, suggesting a generally strong capability. However, performance can vary significantly across different contracts due to factors like contract complexity, management, and specific technical challenges. Industry benchmarks for C5ISR engineering services often focus on metrics such as on-time delivery, adherence to technical specifications, cost control, and innovation. A comprehensive comparison would involve analyzing BAE's performance metrics against those of competitors like Lockheed Martin, Raytheon, and Northrop Grumman on comparable naval C5ISR programs. The current contract's 'good' rating suggests satisfactory performance, but a deeper dive into specific metrics is needed for a definitive benchmark.

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

Key Performance Indicators (KPIs) for a contract of this nature, supporting RCS/C5ISR systems engineering, would likely focus on technical performance, schedule adherence, cost control, and system reliability. Specific KPIs could include: Mean Time Between Failures (MTBF) for supported systems, on-time delivery of engineering documentation and support, successful integration of system upgrades, reduction in reported system anomalies, and adherence to budget projections within the Cost Plus Fixed Fee structure. The Naval Air Warfare Center Aircraft Division (NAWC-AD) would establish these KPIs in the contract's Performance Work Statement (PWS). Regular performance reviews and milestone achievements would be tracked against these KPIs to ensure the contractor, BAE Systems, is meeting the government's requirements effectively and delivering value for the investment.

What is the potential impact of technological obsolescence on the long-term value of this contract?

Technological obsolescence poses a significant risk to the long-term value of contracts supporting complex systems like RCS/C5ISR. The rapid pace of technological advancement means that systems designed and supported under this contract could become outdated relatively quickly. To mitigate this, the contract likely includes provisions for incorporating new technologies, system upgrades, and lifecycle management strategies. The effectiveness of BAE Systems in anticipating and adapting to these technological shifts will be crucial. If the contract adequately addresses obsolescence through flexible design, modularity, and proactive technology insertion, its long-term value can be preserved. Conversely, a failure to adapt could lead to diminished operational effectiveness and increased sustainment costs for the Navy, thereby reducing the contract's overall value.

How does the geographic scope of 'associated shore sites' impact the contract's complexity and cost?

The inclusion of 'associated shore sites' alongside naval surface combatants significantly broadens the geographic scope and complexity of this contract. Supporting systems at multiple, potentially dispersed, shore locations requires logistical coordination, travel, and potentially different operational environments compared to shipboard support. This can increase costs associated with personnel deployment, equipment transport, and varying security requirements. Furthermore, shore sites may host different configurations or generations of RCS/C5ISR systems, demanding a wider range of expertise from the contractor. Managing these diverse requirements across numerous locations necessitates robust project management and communication protocols to ensure consistent service delivery and maintain the overall effectiveness of the C5ISR network.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002412R3093

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Compagnie DE Developpement DE L'eau S.A.

Address: 520 GAITHER ROAD, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $197,810,588

Exercised Options: $197,799,058

Current Obligation: $183,062,214

Subaward Activity

Number of Subawards: 123

Total Subaward Amount: $23,204,268

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4018

IDV Type: IDC

Timeline