DoD Awards $299M for WGU-59/B Guidance Sections to BAE Systems

Contract Overview

Contract Amount: $299,264,988 ($299.3M)

Contractor: BAE Systems Information & Electronic Systems Integration Inc

Awarding Agency: Department of Defense

Start Date: 2017-04-04

End Date: 2019-05-31

Contract Duration: 787 days

Daily Burn Rate: $380.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: THIS ORDER PROCURES WGU-59/B GUIDANCE SECTIONS FOR FRP6

Place of Performance

Location: HUDSON, HILLSBOROUGH County, NEW HAMPSHIRE, 03051

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $299.3 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC for work described as: THIS ORDER PROCURES WGU-59/B GUIDANCE SECTIONS FOR FRP6 Key points: 1. Significant contract value of nearly $300 million for specialized missile components. 2. Sole-source award to BAE Systems indicates a lack of competitive bidding. 3. Potential risk associated with single-supplier reliance for critical defense hardware. 4. Spending falls within the Guided Missile and Space Vehicle Manufacturing sector.

Value Assessment

Rating: fair

The contract value of $299.3 million for WGU-59/B guidance sections is substantial. Without comparable contract data or detailed cost breakdowns, it's difficult to definitively assess its pricing against similar procurements. However, the lack of competition suggests potential for higher-than-market pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to BAE Systems. This method limits price discovery and competitive pressure, potentially leading to less favorable pricing for the government compared to a fully competed process.

Taxpayer Impact: The absence of competition in this nearly $300 million award raises concerns about taxpayer value, as the government may not have secured the best possible price.

Public Impact

Procurement of critical guidance sections for the FRP6 program impacts national defense capabilities. The large contract value represents a significant allocation of taxpayer funds towards defense manufacturing. Reliance on a single supplier for these components could pose supply chain risks.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
Lack of transparency in pricing due to non-competitive nature.
Potential for overpayment without competitive benchmarking.

Positive Signals

Procurement supports critical defense systems (FRP6 program).
Awardee is a known defense contractor (BAE Systems).

Sector Analysis

This procurement falls under the Guided Missile and Space Vehicle Manufacturing sector, a specialized area within defense. Spending in this sector is often characterized by high R&D costs, long development cycles, and significant reliance on a few key contractors due to technical expertise and security requirements.

Small Business Impact

The data indicates that this contract was not awarded to small businesses, as the 'sb' field is false. The prime contractor, BAE Systems, is a large defense corporation, suggesting no direct benefit to small businesses through this specific award.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny regarding justification for not competing. Further oversight is needed to ensure the pricing is fair and reasonable and that the government's interests are protected in the absence of competition.

Related Government Programs

Guided Missile and Space Vehicle Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for inflated pricing
Limited transparency on cost justification
Single point of failure in supply chain

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $299.3 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC. THIS ORDER PROCURES WGU-59/B GUIDANCE SECTIONS FOR FRP6

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION 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 $299.3 million.

What is the period of performance?

Start: 2017-04-04. End: 2019-05-31.

What is the justification for this sole-source award, and has the government explored all avenues for competition?

The justification for a sole-source award typically involves factors like unique capabilities, urgent need, or lack of viable alternatives. Without specific documentation, it's presumed the Department of the Navy determined BAE Systems was the only source capable of meeting the requirements for the WGU-59/B guidance sections for the FRP6 program. Further review of the contract file would be necessary to confirm the detailed justification and whether alternative sources were indeed considered and ruled out.

How does the $299 million contract value compare to industry benchmarks for similar guidance sections, considering the lack of competition?

Benchmarking this $299 million contract is challenging due to its sole-source nature and the specialized 'WGU-59/B guidance sections' for the FRP6 program. Typically, non-competed contracts may not reflect market rates. Without access to cost breakdowns or data on similar, competed contracts (if they exist), it's difficult to ascertain if the price is optimal. The government likely relied on internal cost analysis or historical data, but competitive pressure is absent.

What are the long-term risks associated with relying solely on BAE Systems for these critical missile components?

Sole-source reliance on BAE Systems for critical WGU-59/B guidance sections introduces several long-term risks. These include potential supply chain disruptions if BAE Systems faces production issues, limited leverage for the government in future negotiations, and a lack of incentive for BAE Systems to innovate or reduce costs aggressively. It also hinders the development of alternative suppliers, potentially increasing future procurement costs and reducing overall defense industrial base resilience.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 65 RIVER RD, HUDSON, NH, 03051

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: $299,264,988

Exercised Options: $299,264,988

Current Obligation: $299,264,988

Subaward Activity

Number of Subawards: 183

Total Subaward Amount: $180,688,476

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001917D5517

IDV Type: IDC

Timeline