DoD Awards $243M for Guided Missile Systems to BAE Systems, Sole-Source Contract

Contract Overview

Contract Amount: $243,337,067 ($243.3M)

Contractor: BAE Systems Information & Electronic Systems Integration Inc

Awarding Agency: Department of Defense

Start Date: 2019-09-25

End Date: 2025-11-30

Contract Duration: 2,258 days

Daily Burn Rate: $107.8K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: FRP-9 WGU-59/B GUIDANCE SECTIONS

Place of Performance

Location: HUDSON, HILLSBOROUGH County, NEW HAMPSHIRE, 03051

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $243.3 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC for work described as: FRP-9 WGU-59/B GUIDANCE SECTIONS Key points: 1. Significant contract value of $243.3M awarded. 2. Sole-source award to BAE Systems raises competition concerns. 3. Contract duration extends to November 2025, indicating long-term need. 4. Focus on guided missile and space vehicle manufacturing within the defense sector.

Value Assessment

Rating: questionable

The contract value of $243.3M is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar defense contracts. Benchmarking is challenging due to the sole-source nature.

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 limits price discovery and potentially leads to higher costs for taxpayers as there was no opportunity for other vendors to bid.

Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for these guided missile systems.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. The defense sector relies on specialized components, potentially justifying sole-source awards in some cases. Long-term contract duration suggests ongoing strategic importance of these systems. Potential for reduced innovation if competition is consistently avoided.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
High contract value without competitive justification.
Long contract duration without clear performance metrics for competition.

Positive Signals

Addresses critical defense needs for guided missile systems.
BAE Systems is a known entity in defense contracting.
Firm Fixed Price contract provides some cost certainty.

Sector Analysis

This contract falls within the Defense sector, specifically the Guided Missile and Space Vehicle Manufacturing sub-sector. Spending in this area is critical for national security, but often involves high costs and specialized technologies, making competition complex.

Small Business Impact

The data indicates that small businesses were not involved in this specific contract award, as it was a sole-source award to a large prime contractor. There is no information provided on subcontracting opportunities for small businesses.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the price is justified and that future opportunities for competition are explored where feasible. Transparency in the justification for not competing is crucial.

Related Government Programs

Guided Missile and Space Vehicle Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Lack of competition may lead to inflated costs.
Sole-source award limits market research and potential cost savings.
Long contract duration without clear competitive milestones.
Potential for reduced innovation due to lack of competitive pressure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $243.3 million to BAE SYSTEMS INFORMATION & ELECTRONIC SYSTEMS INTEGRATION INC. FRP-9 WGU-59/B GUIDANCE SECTIONS

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $243.3 million.

What is the period of performance?

Start: 2019-09-25. End: 2025-11-30.

What is the specific justification provided by the Department of Defense for awarding this contract on a sole-source basis, and how does it align with federal procurement regulations for non-competiti

The justification for a sole-source award typically centers on unique capabilities, proprietary technology, or urgent national security needs that only one vendor can meet. Federal regulations (like FAR Part 6) outline specific criteria for non-competitive procurements. A thorough review would examine the documentation supporting BAE Systems' unique qualifications and the absence of viable alternatives to ensure compliance and prevent potential misuse of sole-source authority.

How does the per-unit cost of these guided missile systems compare to similar systems procured competitively by other defense agencies or allied nations, and what is the potential taxpayer impact of a

Benchmarking the per-unit cost is challenging without competitive data. If BAE Systems' pricing is significantly higher than comparable systems obtained through competition, it suggests potential overpayment by taxpayers. This discrepancy could stem from the lack of competitive pressure. A detailed cost analysis comparing specifications, performance, and quantities would be necessary to quantify the exact taxpayer impact and identify areas for cost savings in future procurements.

What measures are in place to ensure the effectiveness and timely delivery of the guided missile systems under this long-term, sole-source contract, and how is BAE Systems' performance being monitored

Despite the sole-source nature, robust oversight is critical. The Department of Defense, through agencies like the Defense Contract Management Agency (DCMA), should be actively monitoring BAE Systems' performance against contract milestones, quality standards, and delivery schedules. Contract clauses related to performance incentives, penalties for delays, and regular progress reviews are essential to ensure accountability and the effective utilization of taxpayer funds for national security.

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: N0001918R0018

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ball Corporation

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: $243,337,067

Exercised Options: $243,337,067

Current Obligation: $243,337,067

Subaward Activity

Number of Subawards: 82

Total Subaward Amount: $58,250,604

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0001919D0026

IDV Type: IDC

Timeline