DoD Awards Raytheon $163M for AN/AQS-22 Sonar Systems, Lacking Competition
Contract Overview
Contract Amount: $163,109,282 ($163.1M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2011-09-27
End Date: 2020-11-30
Contract Duration: 3,352 days
Daily Burn Rate: $48.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: AN/AQS-22 AIRBORNE LOW FREQUENCY SONAR
Place of Performance
Location: PORTSMOUTH, NEWPORT County, RHODE ISLAND, 02871
Plain-Language Summary
Department of Defense obligated $163.1 million to RAYTHEON COMPANY for work described as: AN/AQS-22 AIRBORNE LOW FREQUENCY SONAR Key points: 1. Significant contract value awarded to a single vendor. 2. Lack of competition raises concerns about potential overpricing. 3. The contract supports critical naval search and detection capabilities. 4. Sector is specialized in advanced defense system manufacturing.
Value Assessment
Rating: questionable
The total award of $163M over several years for the AN/AQS-22 sonar system is difficult to benchmark without competitive data. The lack of competition suggests potential for higher-than-necessary pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to less favorable terms for the government compared to a competitive process.
Taxpayer Impact: The absence of competition may result in taxpayers paying more for these sonar systems than if multiple vendors had vied for the contract.
Public Impact
Enhances naval capabilities for submarine detection and navigation. Supports advanced technology development in defense systems. Impacts the operational readiness of the U.S. Navy. Potential for long-term reliance on a single supplier.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competitive pricing
- Long contract duration
Positive Signals
- Critical defense capability
- Established technology
Sector Analysis
This contract falls within the Defense sector, specifically in the manufacturing of advanced search and detection systems. Spending in this area is typically high due to the specialized nature and critical importance of military technology.
Small Business Impact
There is no indication that small businesses were involved in this specific contract award. The prime contractor, Raytheon, is a large aerospace and defense company.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and performance. Regular reviews of contract modifications and performance metrics are crucial for accountability.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Potential for price gouging
- Limited transparency in pricing
- Dependency on a single supplier
- Risk of technological obsolescence without competitive pressure
Tags
search-detection-navigation-guidance-aer, department-of-defense, ri, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $163.1 million to RAYTHEON COMPANY. AN/AQS-22 AIRBORNE LOW FREQUENCY SONAR
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $163.1 million.
What is the period of performance?
Start: 2011-09-27. End: 2020-11-30.
What is the justification for the sole-source award of the AN/AQS-22 sonar system, and were alternative solutions considered?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs that cannot be met by other sources. Without a competitive process, it's essential for the Department of Defense to thoroughly document why competition was not feasible and to ensure that the awarded price is still reasonable and represents good value, even without direct price comparison.
How does the government ensure fair pricing and prevent cost overruns in sole-source defense contracts like this one?
In sole-source contracts, the government relies on mechanisms like cost analysis, price negotiation, and audits to ensure fair pricing. They may use historical data, should-cost models, and independent cost estimates. Continuous monitoring of contractor performance and expenditures, along with strict adherence to contract terms, are vital to prevent cost overruns and ensure value for taxpayer money.
What is the long-term strategy for acquiring or upgrading these sonar systems, and will future procurements be competed?
The long-term strategy for acquiring or upgrading critical defense systems like the AN/AQS-22 sonar is crucial for sustained capability and cost-effectiveness. The Department of Defense should outline plans for future competitions, technology refreshes, or potential replacements. Proactive market research and early engagement with potential competitors can help foster a more competitive environment for subsequent procurements.
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: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0001911R0032
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp
Address: 1847 W MAIN RD, PORTSMOUTH, RI, 02871
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: $163,109,282
Exercised Options: $163,109,282
Current Obligation: $163,109,282
Subaward Activity
Number of Subawards: 149
Total Subaward Amount: $46,331,402
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2011-09-27
Current End Date: 2020-11-30
Potential End Date: 2020-11-30 00:00:00
Last Modified: 2022-10-06
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