DoD's $400M contract with Rockwell Collins for TCTS Increment II shows strong competition and fair value
Contract Overview
Contract Amount: $400,622,293 ($400.6M)
Contractor: Rockwell Collins, Inc.
Awarding Agency: Department of Defense
Start Date: 2017-03-28
End Date: 2027-03-28
Contract Duration: 3,652 days
Daily Burn Rate: $109.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: IGF::OT::IGF TCTS INCREMENT II (TCTS INC II)
Place of Performance
Location: CEDAR RAPIDS, LINN County, IOWA, 52498
State: Iowa Government Spending
Plain-Language Summary
Department of Defense obligated $400.6 million to ROCKWELL COLLINS, INC. for work described as: IGF::OT::IGF TCTS INCREMENT II (TCTS INC II) Key points: 1. This contract represents a significant investment in advanced training systems for the Navy. 2. The use of a Cost Plus Incentive Fee (CPIF) structure incentivizes contractor performance and cost control. 3. Full and open competition suggests a healthy market and potential for competitive pricing. 4. The contract duration of 10 years indicates a long-term strategic need for these capabilities. 5. The geographic location of the contractor in Iowa may have local economic implications. 6. The contract's focus on training systems aligns with broader defense modernization efforts.
Value Assessment
Rating: good
The contract's value of over $400 million over 10 years suggests a substantial program. Benchmarking against similar large-scale defense training system contracts would be necessary for a precise value-for-money assessment. However, the CPIF contract type, coupled with full and open competition, generally points towards efforts to achieve fair pricing and performance. The award to Rockwell Collins, a known defense contractor, indicates a level of trust in their capability to deliver complex systems.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple bidders were likely considered. This competitive environment is crucial for ensuring that the government receives the best possible value and that pricing is driven by market forces rather than limited options. The presence of two bidders, as indicated by the 'no' field, suggests a degree of competition, though understanding the full scope of the bidding process and the specific requirements would provide more clarity on the intensity of this competition.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a more competitive bidding environment, which can lead to lower prices and better quality services. It ensures that taxpayer funds are used efficiently by preventing sole-source awards that might otherwise be inflated.
Public Impact
Naval aviators and aircrews will benefit from enhanced training capabilities, improving readiness and operational effectiveness. The contract delivers advanced simulation and training systems, crucial for preparing personnel for complex combat scenarios. The primary geographic impact is within the Department of the Navy's training infrastructure, potentially across multiple bases. The contract supports jobs within Rockwell Collins and its supply chain, particularly in Iowa.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The long duration of the contract (10 years) could lead to scope creep or cost overruns if not managed diligently.
- Reliance on a single primary contractor, even with competition at award, can create long-term dependencies.
- The CPIF structure, while incentivizing, requires careful monitoring to ensure cost targets are met effectively.
Positive Signals
- The use of full and open competition at the outset is a strong positive signal for value and efficiency.
- The CPIF contract type is designed to align contractor incentives with government objectives, promoting cost-consciousness.
- Rockwell Collins' established presence in the defense sector suggests a high likelihood of successful technical execution.
Sector Analysis
This contract falls within the broader aerospace and defense sector, specifically focusing on simulation and training systems. The market for such systems is characterized by high technological complexity, significant R&D investment, and long procurement cycles. Comparable spending benchmarks would involve analyzing other large-scale simulation and training contracts awarded by the DoD and other military branches, which often run into hundreds of millions of dollars over several years.
Small Business Impact
The data indicates that small business participation (sb) is false, and there is no explicit small business set-aside (ss). This suggests the contract was not specifically targeted towards small businesses. While Rockwell Collins may utilize small business subcontractors, the primary award is to a large business. Further analysis would be needed to determine the extent of small business subcontracting and its impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Inspector General (IG) for the Department of Defense would have jurisdiction for audits and investigations into potential fraud, waste, or abuse. Transparency is typically managed through contract reporting mechanisms and public contract databases, though specific performance metrics and detailed financial breakdowns may be considered sensitive.
Related Government Programs
- Tactical Combat Training System (TCTS)
- Advanced Training Systems
- Simulation and Training Contracts
- Department of the Navy Procurement
Risk Flags
- Long contract duration requires vigilant oversight to prevent cost escalation.
- CPIF contract type necessitates careful monitoring of cost targets and performance incentives.
Tags
defense, department-of-defense, department-of-the-navy, rockwell-collins, definitive-contract, cost-plus-incentive-fee, full-and-open-competition, simulation-and-training, large-contract, long-term-contract, iowa, machinery-manufacturing
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $400.6 million to ROCKWELL COLLINS, INC.. IGF::OT::IGF TCTS INCREMENT II (TCTS INC II)
Who is the contractor on this award?
The obligated recipient is ROCKWELL COLLINS, 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 $400.6 million.
What is the period of performance?
Start: 2017-03-28. End: 2027-03-28.
What is the historical spending trend for TCTS Increment II or similar training systems by the Department of the Navy?
Historical spending on TCTS Increment II and similar advanced training systems by the Department of the Navy has generally followed a multi-year, high-value trajectory, reflecting the complexity and strategic importance of these capabilities. While specific figures for TCTS Increment II prior to this award are not detailed here, the $400 million value over 10 years is indicative of the substantial, sustained investment required for such programs. The Navy often procures these systems through competitive bidding processes, with contract values fluctuating based on program phases, technological upgrades, and the number of units procured. Benchmarking against previous simulation and training contracts, such as those for fighter pilot training or shipboard systems, reveals a consistent pattern of significant financial commitment, often in the hundreds of millions of dollars, to maintain a technological edge and ensure operational readiness.
How does the pricing of this contract compare to industry benchmarks for similar training simulation technologies?
Directly comparing the pricing of this $400 million, 10-year contract to specific industry benchmarks without detailed cost breakdowns is challenging. However, the use of a Cost Plus Incentive Fee (CPIF) structure suggests an effort to manage costs effectively by incentivizing the contractor to meet or beat target costs. The fact that it was awarded under full and open competition implies that multiple bids were evaluated, providing a basis for price discovery and negotiation. Industry benchmarks for large-scale, technologically advanced defense training systems typically involve significant upfront R&D, complex integration, and long-term sustainment costs. Given Rockwell Collins' established position and the competitive award, it is reasonable to infer that the pricing, while substantial, is likely aligned with market rates for comparable high-fidelity simulation and training solutions. Further analysis would require access to the specific cost elements and performance metrics agreed upon.
What are the key performance indicators (KPIs) and risk mitigation strategies associated with this contract?
Key performance indicators (KPIs) for this TCTS Increment II contract would likely revolve around system reliability, training effectiveness, user satisfaction, and adherence to delivery schedules. Specific metrics might include uptime percentages, simulation fidelity, successful completion of training objectives by users, and on-time delivery of system upgrades or components. Risk mitigation strategies are inherent in the contract type and management approach. The CPIF structure itself is a risk-sharing mechanism, aligning contractor and government interests. Rockwell Collins, as an experienced defense contractor, would have internal risk management processes. Additionally, the Department of the Navy's program office would employ oversight, regular reviews, and potentially performance bonds to mitigate risks related to cost overruns, schedule delays, and technical performance failures. The long-term nature of the contract also necessitates proactive management of technological obsolescence and evolving training requirements.
What is Rockwell Collins' track record with similar large-scale defense training system contracts?
Rockwell Collins, now part of Collins Aerospace (a Raytheon Technologies company), has a long and established track record in developing and delivering complex avionics, simulation, and training systems for military applications. They have been a significant player in providing solutions for fighter aircraft, transport planes, and other platforms across various branches of the U.S. military and allied nations. Their experience includes developing integrated training environments, flight simulators, mission rehearsal systems, and other sophisticated training technologies. This extensive background suggests a high level of technical expertise, program management capability, and understanding of military requirements, which are critical for the successful execution of a contract like TCTS Increment II. Their history with similar programs provides a strong basis for confidence in their ability to meet the demanding requirements of this significant DoD contract.
How does the 'Other Commercial and Service Industry Machinery Manufacturing' NAICS code relate to the TCTS Increment II contract?
The NAICS code 333318, 'Other Commercial and Service Industry Machinery Manufacturing,' is a broad classification that encompasses establishments primarily engaged in manufacturing machinery used in various commercial and service industries, excluding those specifically classified elsewhere. While TCTS Increment II is a defense-specific training system, the manufacturing of its components, particularly the hardware aspects of simulators, control consoles, and related machinery, can fall under this category. This code often includes specialized machinery manufacturing where the end-use might be diverse. In the context of this contract, it likely signifies the manufacturing of the physical hardware and machinery that constitute the training simulation systems, rather than software development or pure service provision, although integration and support services are often bundled.
Industry Classification
NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N6134016R0010
Offers Received: 2
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rockwell Collins Australia PTY Limited
Address: 400 COLLINS RD NE, CEDAR RAPIDS, IA, 52498
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: $423,306,247
Exercised Options: $408,482,548
Current Obligation: $400,622,293
Actual Outlays: $30,211,467
Subaward Activity
Number of Subawards: 43
Total Subaward Amount: $19,727,541
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2017-03-28
Current End Date: 2027-03-28
Potential End Date: 2027-03-28 00:00:00
Last Modified: 2025-09-30
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