Raytheon Awarded $73.9M for Guided Missile Systems, Sole-Sourced
Contract Overview
Contract Amount: $73,915,074 ($73.9M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2006-04-28
End Date: 2010-10-29
Contract Duration: 1,645 days
Daily Burn Rate: $44.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 200607!062902!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002406C5422 !A!N! !N! ! !20060428!20080630!001463090!001463090!001339159!N!RAYTHEON COMPANY !1847 W MAIN RD !PORTSMOUTH !RI!02871!57700!005!44!PORTSMOUTH !NEWPORT !RHODE ISLD!+000010748000!N!N!000021500000!1425!GUIDED MISSILE SYSTEMS, COMPLETE !A2 !MISSILE AND SPACE SYSTEMS !000 !NOT DISCERNABLE !336414!E! !1! ! ! ! ! !99990909!B! ! !A! !D!N!J!1!001!N!1G!A!N!F! ! !N!C!N! ! ! !A!A!A!A!000!A!C!Y! ! ! !Y!1700!N49661!0001! !
Place of Performance
Location: PORTSMOUTH, NEWPORT County, RHODE ISLAND, 02871
Plain-Language Summary
Department of Defense obligated $73.9 million to RAYTHEON COMPANY for work described as: 200607!062902!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002406C5422 !A!N! !N! ! !20060428!20080630!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 guided missile systems, a critical defense component. 2. Raytheon Company is the sole awardee, indicating a lack of competition. 3. The contract value is substantial at $73.9 million. 4. The sector is Defense, specifically missile and space systems manufacturing.
Value Assessment
Rating: questionable
The contract value of $73.9 million for guided missile systems is significant. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Raytheon Company, was considered. This significantly limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competition raises concerns about the efficient use of taxpayer funds, as a potentially lower price may have been achievable through a competitive process.
Public Impact
Taxpayers may be overpaying for critical missile systems due to the absence of competition. The Department of Defense relies on Raytheon for these specialized systems, highlighting potential single-source dependency. The long contract duration (2006-2010) suggests a sustained need for these capabilities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- Potential for overpayment
Positive Signals
- Awarded to a known defense contractor
- Addresses a critical defense need
Sector Analysis
This contract falls within the Defense sector, specifically the manufacturing of guided missile and space vehicles. Spending in this area is typically high due to national security requirements, but competitive sourcing is crucial for cost efficiency.
Small Business Impact
There is no indication in the provided data that small businesses were involved in this contract, either as prime contractors or subcontractors.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the government is receiving the best possible value and that Raytheon is meeting all contractual obligations effectively.
Related Government Programs
- Guided Missile and Space Vehicle Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing.
- Lack of transparency in price justification.
- Dependency on a single contractor.
- Limited opportunity for small business participation.
Tags
guided-missile-and-space-vehicle-manufac, department-of-defense, ri, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $73.9 million to RAYTHEON COMPANY. 200607!062902!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002406C5422 !A!N! !N! ! !20060428!20080630!001463090!001463090!001339159!N!RAYTHEON COMPANY !1847 W MAIN RD !PORTSMOUTH !RI!02871!57700!005!44!PORTSMOUTH !NEWPORT !RHODE ISLD!+000010748000!N!N!000021500000!1425!GUIDED MISSILE SYSTEMS, COMPLETE !A2 !MISSILE AND SPACE SYSTEMS !000 !NOT DISCERNABLE !336414!E! !1! ! ! ! ! !999
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 $73.9 million.
What is the period of performance?
Start: 2006-04-28. End: 2010-10-29.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or a lack of adequate competition within the required timeframe. Without further documentation, it's impossible to definitively state the reason, but it implies that only Raytheon could meet the specific requirements of the Naval Sea Systems Command for these guided missile systems.
What are the long-term risks associated with relying on a sole-source provider for critical defense systems?
Long-term reliance on a sole-source provider can lead to price escalation, reduced innovation, and a lack of flexibility. The government may become overly dependent on a single supplier, making it difficult to switch or negotiate favorable terms. This can also stifle competition and discourage new entrants in the market.
How can the effectiveness of this contract be measured given the lack of competitive benchmarks?
Effectiveness can be measured through performance metrics outlined in the contract, such as delivery timelines, system reliability, and technical specifications met. Independent technical reviews and end-user feedback from the Naval Sea Systems Command would also be crucial indicators of effectiveness, independent of the pricing structure.
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
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1847 W MAIN RD, PORTSMOUTH, RI, 01
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2006-04-28
Current End Date: 2010-10-29
Potential End Date: 2010-10-29 00:00:00
Last Modified: 2011-02-18
More Contracts from Raytheon Company
- Federal Contract — $5.7B (Department of Defense)
- TEN Fire Units for Qatar — $5.6B (Department of Defense)
- GPS Advanced Control Segment (OCX) Phase B Blocks 1 and 2 — $4.5B (Department of Defense)
- An/Spy-6(v) Hardware Production — $3.3B (Department of Defense)
- Predominant - Patriot UAE — $3.0B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)