Naval Undersea Warfare Center awards $43.2M contract for optical instruments, highlighting defense sector needs

Contract Overview

Contract Amount: $43,204,580 ($43.2M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2005-04-28

End Date: 2013-06-05

Contract Duration: 2,960 days

Daily Burn Rate: $14.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200507!050572!1700!N66604!NAVAL UNDERSEA WARFARE CENTER !N6660405C0572 !A!N! !N! ! !20050428!20060528!041491895!041491895!024744476!N!KOLLMORGEN CORPORATION !347 KING ST !NORTHAMPTON !MA!01060!46330!015!25!NORTHAMPTON !HAMPSHIRE !MASS !+000001923756!N!N!000000000000!6650!OPTICAL INSTRUMENTS, TEST EQUIP, COMPS & ACCYS !C9E!ALL OTHER SUPPLIES AND EQUIPMENT !000 !* !333314!E! !3! ! ! ! ! !20200930!B! ! !A! !A!N!J!2!001!B! !A!N!Z! ! !N!C!N! ! ! !Z!Z!A!A!000!A!B!N! ! ! ! !1724!N66604!0001! !

Place of Performance

Location: NORTHAMPTON, HAMPSHIRE County, MASSACHUSETTS, 01060, UNITED STATES OF AMERICA

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $43.2 million to L3 TECHNOLOGIES, INC. for work described as: 200507!050572!1700!N66604!NAVAL UNDERSEA WARFARE CENTER !N6660405C0572 !A!N! !N! ! !20050428!20060528!041491895!041491895!024744476!N!KOLLMORGEN CORPORATION !347 KING ST !NORTHAMPTON !MA!01060!46330!015!25!NORTHAMPTON !HAMP… Key points: 1. Contract awarded for optical instruments and test equipment, crucial for naval undersea operations. 2. Full and open competition suggests a competitive bidding process, potentially leading to better pricing. 3. The contract duration of approximately 8 years indicates a long-term need for these specialized supplies. 4. Awarded by the Department of Defense, this contract aligns with significant defense spending in advanced technologies. 5. The specific product service code (PSC) points to a niche market within defense procurement. 6. The contractor, L3 Technologies, Inc., is a significant player in the defense industry.

Value Assessment

Rating: good

The contract value of $43.2 million over its duration appears reasonable for specialized optical instruments and test equipment for defense applications. Benchmarking against similar contracts for advanced optical systems in the defense sector would provide a more precise value-for-money assessment. However, the fixed-price nature of the contract suggests that the government has a clear understanding of the costs involved, which can be a positive indicator of price control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. This approach generally fosters a competitive environment, encouraging multiple bidders to offer their best pricing and technical solutions. The number of bidders is not specified, but the 'full and open' designation implies a robust competition.

Taxpayer Impact: A competitive bidding process like this is beneficial for taxpayers as it is more likely to result in a fair market price and prevent cost overruns compared to sole-source or limited competition awards.

Public Impact

Naval operations and undersea warfare capabilities are enhanced through the provision of advanced optical instruments. Personnel involved in naval technology development and maintenance will utilize these specialized equipment. The contract supports the Department of Defense's strategic objectives in maintaining technological superiority. The geographic impact is primarily within naval facilities and research centers, with potential for broader defense applications.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for obsolescence of optical technology over the contract's long duration.
Dependence on a single contractor for critical optical components could pose supply chain risks.
Ensuring continued innovation and upgrades to optical systems within a fixed-price contract framework.

Positive Signals

The contract supports the development and maintenance of advanced naval technology.
Full and open competition suggests a commitment to achieving best value for taxpayer dollars.
The long contract duration indicates a stable and predictable supply of essential equipment for naval readiness.

Sector Analysis

This contract falls within the broader defense industry, specifically the segment focused on optical instruments, test equipment, and related accessories. The market for defense-related optical technology is characterized by high R&D investment, stringent performance requirements, and long product lifecycles. Comparable spending benchmarks would typically be found within other major defense procurement programs for sensor systems, targeting equipment, and surveillance technologies, often running into tens or hundreds of millions of dollars.

Small Business Impact

The provided data does not indicate any specific small business set-asides or subcontracting requirements for this contract. As a full and open competition award, it's possible that small businesses could have participated directly or indirectly. However, without further details on subcontracting plans, the direct impact on the small business ecosystem remains unclear. Larger prime contractors often engage small businesses for specialized components or services.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), ensuring compliance with contract terms, quality standards, and delivery schedules. Accountability measures are embedded in the firm fixed-price structure, which places the cost risk on the contractor. Transparency is generally maintained through contract award databases, though specific performance metrics might be considered sensitive defense information.

Related Government Programs

Naval Sea Systems Command (NAVSEA) Contracts
Defense Advanced Research Projects Agency (DARPA) Programs
Optical Sensor Systems Procurement
Naval Warfare Technology Development
Test and Measurement Equipment for Defense

Risk Flags

Long contract duration may lead to technology obsolescence.
Potential supply chain risks for specialized optical components.
Need for rigorous quality assurance over the contract's life.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $43.2 million to L3 TECHNOLOGIES, INC.. 200507!050572!1700!N66604!NAVAL UNDERSEA WARFARE CENTER !N6660405C0572 !A!N! !N! ! !20050428!20060528!041491895!041491895!024744476!N!KOLLMORGEN CORPORATION !347 KING ST !NORTHAMPTON !MA!01060!46330!015!25!NORTHAMPTON !HAMPSHIRE !MASS !+000001923756!N!N!000000000000!6650!OPTICAL INSTRUMENTS, TEST EQUIP, COMPS & ACCYS !C9E!ALL OTHER SUPPLIES AND EQUIPMENT !000 !* !333314!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is L3 TECHNOLOGIES, 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 $43.2 million.

What is the period of performance?

Start: 2005-04-28. End: 2013-06-05.

What is the specific nature of the optical instruments and test equipment being procured under this contract, and how do they support naval undersea warfare?

The contract, identified by Product Service Code (PSC) 6650, covers 'Optical Instruments, Test Equip, Comps & Accys.' This suggests the procurement of a range of items including specialized lenses, periscopes, optical sensors, calibration devices, and diagnostic tools essential for the operation, maintenance, and development of undersea systems. These instruments are critical for functions such as target identification, navigation, surveillance, and data collection in the challenging underwater environment. For naval undersea warfare, advanced optical systems are vital for submarines, unmanned underwater vehicles (UUVs), and surface vessels to maintain situational awareness, detect threats, and execute missions effectively.

How does the contract value of approximately $43.2 million compare to similar procurements for advanced optical systems within the Department of Defense?

The contract value of $43.2 million over its approximately 8-year duration (from April 2005 to June 2013) represents a significant but not extraordinary investment for specialized defense hardware. Procurements for advanced optical systems, particularly those involving cutting-edge technology for platforms like submarines or advanced aircraft, can range from tens of millions to several billion dollars depending on the scope, quantity, and technological sophistication. For instance, contracts for advanced targeting pods or reconnaissance sensor suites often exceed this amount. The value here suggests a substantial quantity or a high degree of customization for specific naval undersea applications, fitting within the typical spending patterns for such critical defense components.

What are the potential risks associated with a long-duration contract (nearly 8 years) for optical instruments, and how might they be mitigated?

A long-duration contract for optical instruments carries several risks. Technological obsolescence is a primary concern; optical technology evolves rapidly, and equipment procured early in the contract might be outdated by its end. Supply chain disruptions are another risk, especially if the contractor relies on specialized components or faces production challenges. Furthermore, maintaining consistent quality and performance over an extended period requires robust oversight. Mitigation strategies include incorporating clauses for technology refresh or upgrades, requiring the contractor to maintain adequate inventory and diversify their supply chain, and implementing rigorous quality assurance and acceptance testing protocols throughout the contract's life. The firm fixed-price nature also incentivizes the contractor to manage risks effectively.

Given the 'full and open competition' award, what does this imply about the contractor's (KOLLMORGEN CORPORATION) track record and capability in delivering these specialized optical systems?

The award to KOLLMORGEN CORPORATION under 'full and open competition' suggests that the company demonstrated the necessary technical capabilities, past performance, and competitive pricing to win the contract against other potential bidders. This implies a recognized track record in producing optical instruments and test equipment suitable for demanding applications. While the data doesn't detail the specific evaluation criteria, winning a full and open competition indicates that KOLLMORGEN met or exceeded the government's requirements for quality, delivery, and cost. It signifies confidence from the Naval Undersea Warfare Center in their ability to fulfill the contract's objectives.

How does this contract align with historical spending patterns for optical instruments and test equipment within the Department of Defense?

Historical spending patterns within the Department of Defense consistently show significant investment in optical instruments and test equipment due to their critical role in surveillance, targeting, navigation, and research across all military branches. The Naval Undersea Warfare Center, in particular, requires advanced optical solutions for its unique operational environment. Contracts for such items are common and often substantial, reflecting the high cost of specialized manufacturing and R&D. This $43.2 million award aligns with these patterns, representing a typical investment for equipping naval assets with essential optical capabilities over a multi-year period, supporting ongoing modernization and operational readiness efforts.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Optical Instrument and Lens Manufacturing

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)

Address: 347 KING ST, NORTHAMPTON, MA, 01060

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline