Raytheon Awarded $198M for Electrical Hardware and Supplies by Naval Sea Systems Command

Contract Overview

Contract Amount: $198,051,936 ($198.1M)

Contractor: Raytheon Company

Awarding Agency: Department of Defense

Start Date: 2005-09-15

End Date: 2015-05-29

Contract Duration: 3,543 days

Daily Burn Rate: $55.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200512!053232!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405C6324 !A!N! !N!0000 ! !20050915!20100330!001463090!001463090!001339159!N!RAYTHEON COMPANY !1847 W MAIN RD !PORTSMOUTH !RI!02871!57700!005!44!PORTSMOUTH !NEWPORT !RHODE ISLD!+000021353724!N!N!000195000000!5975!ELECTRICAL HARDWARE AND SUPPLIES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334511!E! !1! ! ! ! ! !20200930!B! ! !A! !D!N!J!1!001!N!1B!Z!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!Y! ! ! !Y!1700!N00024!0001! !

Place of Performance

Location: PORTSMOUTH, NEWPORT County, RHODE ISLAND, 02871

State: Rhode Island Government Spending

Plain-Language Summary

Department of Defense obligated $198.1 million to RAYTHEON COMPANY for work described as: 200512!053232!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405C6324 !A!N! !N!0000 ! !20050915!20100330!001463090!001463090!001339159!N!RAYTHEON COMPANY !1847 W MAIN RD !PORTSMOUTH !RI!02871!57700!005!44!PORTSMOUTH !NEWP… Key points: 1. The contract is for electrical hardware and supplies, a critical component for naval operations. 2. Raytheon Company, a major defense contractor, secured this award. 3. The contract was not competed, raising potential concerns about price discovery. 4. The sector is Defense, specifically focusing on electronics and communication equipment.

Value Assessment

Rating: fair

The contract value of $198 million for electrical hardware and supplies appears substantial. Benchmarking against similar contracts for specialized naval electronics is difficult without more detailed cost breakdowns, but the duration and scope suggest a significant investment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This limits price discovery and may result in higher costs for the government compared to a competitive procurement.

Taxpayer Impact: The lack of competition could lead to taxpayers paying a premium for these essential supplies.

Public Impact

Naval readiness may be impacted by the availability and quality of these electrical components. The sole-source nature of the award warrants scrutiny to ensure fair pricing. Dependence on a single supplier for critical hardware can create supply chain risks. This spending contributes to the defense industrial base, supporting jobs and technological development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Potential for overpricing due to lack of competition
Long contract duration

Positive Signals

Award to a known, capable contractor
Supports critical naval systems

Sector Analysis

This contract falls within the Defense sector, specifically for electronics and communication equipment. Spending in this area is crucial for maintaining naval technological superiority and operational capabilities. Benchmarks for similar sole-source procurements of specialized hardware are often higher due to limited market options.

Small Business Impact

There is no indication that small businesses were involved in this specific sole-source contract. Future procurements should explore opportunities for small business participation where feasible.

Oversight & Accountability

The Naval Sea Systems Command is responsible for this award. Oversight should focus on ensuring the justification for the sole-source award is robust and that pricing is reasonable through post-award audits or reviews.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source award lacks competitive pricing pressure.
Potential for cost overruns due to lack of competition.
Long contract duration may not reflect evolving technology needs.
Dependence on a single supplier poses supply chain risk.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $198.1 million to RAYTHEON COMPANY. 200512!053232!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405C6324 !A!N! !N!0000 ! !20050915!20100330!001463090!001463090!001339159!N!RAYTHEON COMPANY !1847 W MAIN RD !PORTSMOUTH !RI!02871!57700!005!44!PORTSMOUTH !NEWPORT !RHODE ISLD!+000021353724!N!N!000195000000!5975!ELECTRICAL HARDWARE AND SUPPLIES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334511!E! !1! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $198.1 million.

What is the period of performance?

Start: 2005-09-15. End: 2015-05-29.

What is the specific justification for awarding this contract on a sole-source basis, and has it been adequately documented?

The justification for a sole-source award typically centers on unique capabilities, proprietary technology, or the absence of adequate competition. For this contract, the specific reason needs to be thoroughly documented by the Naval Sea Systems Command. Without this documentation, it's difficult to assess if the sole-source decision was truly necessary or if alternative competitive strategies were overlooked, potentially impacting the government's ability to secure the best value.

How does the pricing of this contract compare to industry benchmarks for similar electrical hardware and supplies, especially considering the sole-source nature?

Assessing the pricing requires comparing the per-unit costs and overall value against similar contracts awarded competitively or against established industry price lists for comparable components. Given this was a sole-source award to Raytheon, there's an inherent risk of a price premium. A detailed cost analysis by the government, potentially involving independent cost estimation or benchmarking against other sole-source awards for similar items, is crucial to determine if the price paid represents fair value.

What are the potential risks associated with a long-term, sole-source contract for critical electrical hardware, and what mitigation strategies are in place?

Risks include potential price escalation over the contract's life, limited access to technological advancements from other suppliers, and supply chain vulnerabilities if the sole source faces production issues. Mitigation strategies could involve robust contract clauses for price reviews, performance incentives, and requiring the contractor to provide detailed cost breakdowns. The government might also explore developing alternative sources or in-house capabilities over time.

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: ELECTRICAL/ELECTRONIC EQPT COMPNTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1847 W MAIN RD, PORTSMOUTH, RI, 02871

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline