DoD Awards $202M for 120 Advanced Anti-Radiation Missiles to Alliant Techsystems
Contract Overview
Contract Amount: $202,285,553 ($202.3M)
Contractor: Alliant Techsystems Operations LLC
Awarding Agency: Department of Defense
Start Date: 2013-09-25
End Date: 2020-12-31
Contract Duration: 2,654 days
Daily Burn Rate: $76.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: AGM-88E AARGM FULL RATE PRODUCTION LOT 2: 97 US MISSILES, 15 ITAF MISSILES, 8 RAAF MISSILES, PLUS ASSCOIATED EFFORTS
Place of Performance
Location: NORTHRIDGE, LOS ANGELES County, CALIFORNIA, 91324
Plain-Language Summary
Department of Defense obligated $202.3 million to ALLIANT TECHSYSTEMS OPERATIONS LLC for work described as: AGM-88E AARGM FULL RATE PRODUCTION LOT 2: 97 US MISSILES, 15 ITAF MISSILES, 8 RAAF MISSILES, PLUS ASSCOIATED EFFORTS Key points: 1. Significant procurement of advanced air-to-ground missiles for US and allied forces. 2. Sole-source award to Alliant Techsystems highlights reliance on a single provider. 3. Long contract duration (2013-2020) suggests a sustained need for this capability. 4. High per-unit cost warrants scrutiny given the lack of competitive bidding.
Value Assessment
Rating: questionable
The contract value of $202.3M for 120 missiles results in a per-unit cost of approximately $1.68M. Without competitive benchmarking, it's difficult to assess if this price is reasonable compared to similar advanced missile systems.
Cost Per Unit: $1,685,712.94
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Alliant Techsystems. This lack of competition limits price discovery and may lead to higher costs for taxpayers.
Taxpayer Impact: The absence of competition for a significant missile procurement raises concerns about potential overspending and the efficient use of taxpayer funds.
Public Impact
Enhances air combat capabilities for the US Air Force, Navy, and allied nations (Italy, Australia). Supports the warfighter with advanced standoff strike capabilities against enemy air defenses. Ensures continued availability of a critical munition for ongoing and future operations. Potential for increased costs due to sole-source nature impacts overall defense budget allocation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High per-unit cost
Positive Signals
- Procurement of advanced weapon system
- Support for allied nations
- Long-term sustainment of capability
Sector Analysis
This procurement falls within the Guided Missile and Space Vehicle Manufacturing sector. Spending in this area is critical for maintaining military technological superiority, but often involves high R&D costs and limited competition due to specialized capabilities.
Small Business Impact
The contract was awarded to Alliant Techsystems Operations LLC, a large business. There is no indication of subcontracting opportunities for small businesses within the provided data.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency (DCMA). While the contract itself is a definitive contract, the lack of competition suggests oversight should focus on ensuring fair pricing and performance.
Related Government Programs
- Guided Missile and Space Vehicle Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits price competition.
- High per-unit cost without competitive benchmark.
- Lack of transparency in pricing justification.
- Potential for cost overruns due to non-competitive nature.
- Limited visibility into small business participation.
Tags
guided-missile-and-space-vehicle-manufac, department-of-defense, ca, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $202.3 million to ALLIANT TECHSYSTEMS OPERATIONS LLC. AGM-88E AARGM FULL RATE PRODUCTION LOT 2: 97 US MISSILES, 15 ITAF MISSILES, 8 RAAF MISSILES, PLUS ASSCOIATED EFFORTS
Who is the contractor on this award?
The obligated recipient is ALLIANT TECHSYSTEMS OPERATIONS LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $202.3 million.
What is the period of performance?
Start: 2013-09-25. End: 2020-12-31.
What is the justification for the sole-source award of the AGM-88E AARGM missiles, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities or proprietary technology. The agency should have conducted a thorough market analysis and justification process to ensure Alliant Techsystems' pricing was fair and reasonable, potentially through cost analysis or comparison to previous contract data, despite the absence of direct competition.
How does the per-unit cost of the AGM-88E AARGM compare to similar advanced air-to-ground missile systems procured competitively?
Without competitive data for comparable systems, a direct comparison is challenging. However, the calculated per-unit cost of approximately $1.68M is substantial. A review of publicly available data on other advanced missile systems, considering their capabilities and production volumes, would be necessary to assess if this cost is within an expected range or indicates potential inefficiency.
What is the long-term strategy for ensuring competitive sourcing or cost reduction for future lots of the AGM-88E AARGM, given the current sole-source arrangement?
The Department of Defense should explore strategies for future procurements, such as developing alternative sources, encouraging technological advancements that could lead to competition, or negotiating long-term agreements with built-in cost reduction incentives. Periodic re-evaluation of the sole-source justification is also crucial.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0001913R0018
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 21301 BURBANK BLVD STE 100, WOODLAND HILLS, CA, 91367
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: $202,285,553
Exercised Options: $202,285,553
Current Obligation: $202,285,553
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2013-09-25
Current End Date: 2020-12-31
Potential End Date: 2020-12-31 00:00:00
Last Modified: 2020-09-16
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