Navy awards $33M contract for airborne threat simulation, with Dynetics Inc. as prime

Contract Overview

Contract Amount: $32,997,326 ($33.0M)

Contractor: Dynetics, Inc.

Awarding Agency: Department of Defense

Start Date: 2018-06-27

End Date: 2024-09-30

Contract Duration: 2,287 days

Daily Burn Rate: $14.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: AIRBORNE THREAT SIMULATION ORGANIZATION

Place of Performance

Location: POINT MUGU NAWC, VENTURA County, CALIFORNIA, 93042

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $33.0 million to DYNETICS, INC. for work described as: AIRBORNE THREAT SIMULATION ORGANIZATION Key points: 1. Contract value of $33M over 6 years suggests a significant investment in advanced simulation capabilities. 2. The full and open competition indicates a healthy market for these specialized services. 3. The cost-plus-fixed-fee pricing structure may present cost control challenges if not closely monitored. 4. Performance is tied to a long duration, requiring sustained oversight. 5. The contract falls within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector. 6. The award to Dynetics, Inc. positions them as a key player in this niche defense market.

Value Assessment

Rating: fair

The contract's total value of $33 million over approximately six years averages to about $5.5 million annually. Benchmarking this against similar contracts for advanced simulation systems is challenging without more specific service details. However, the cost-plus-fixed-fee (CPFF) structure, while allowing for flexibility, can lead to higher costs if the contractor's expenses exceed initial estimates. The fixed fee component provides some predictability, but the overall value for money depends heavily on the efficiency of the contractor's execution and the government's oversight of costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple capable vendors were invited to bid. The presence of four bidders indicates a competitive landscape for airborne threat simulation systems. This level of competition is generally favorable for price discovery and can lead to more competitive pricing for the government.

Taxpayer Impact: The full and open competition likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition award.

Public Impact

The Department of the Navy benefits from enhanced capabilities in airborne threat simulation for training and testing. This contract supports the development and delivery of advanced simulation systems crucial for national defense. The primary geographic impact is likely within the United States, supporting defense operations and research facilities. The contract may have implications for a specialized workforce in aerospace engineering, simulation development, and testing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize higher spending if not managed diligently.
Long contract duration requires sustained government oversight to ensure performance and cost control.
The specific nature of 'airborne threat simulation' may involve complex technical risks and potential for cost overruns.

Positive Signals

Awarded through full and open competition, suggesting a robust market and potential for competitive pricing.
The prime contractor, Dynetics, Inc., has a track record in defense contracting, implying experience with similar projects.
The contract duration allows for long-term development and integration of critical simulation capabilities.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on simulation and training systems. The market for such specialized equipment is driven by defense spending and the need for realistic training environments. Comparable spending benchmarks would typically involve other advanced simulation platforms, electronic warfare systems, and aircraft component manufacturing, which can range from millions to hundreds of millions of dollars depending on complexity and scale.

Small Business Impact

While the prime contractor is Dynetics, Inc., the contract details do not specify any small business set-asides or subcontracting requirements. Analysis of subcontracting opportunities would require further investigation into Dynetics' procurement practices and the specific needs of the simulation system. The absence of explicit set-asides suggests that the primary focus was on securing the best technical solution from the most capable large businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and their representatives within the Department of the Navy. Accountability measures are embedded in the contract's performance requirements and payment terms. Transparency is facilitated through contract award databases, but detailed operational oversight and Inspector General jurisdiction would depend on the specific program and any associated audits or investigations.

Related Government Programs

Airborne Electronic Warfare Systems
Flight Simulation Training Devices
Radar and Navigation Systems Manufacturing
Defense Research and Development

Risk Flags

Cost-plus-fixed-fee pricing structure requires diligent cost oversight.
Long contract duration necessitates sustained performance monitoring.
Potential for technical complexity leading to cost overruns.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.0 million to DYNETICS, INC.. AIRBORNE THREAT SIMULATION ORGANIZATION

Who is the contractor on this award?

The obligated recipient is DYNETICS, 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 $33.0 million.

What is the period of performance?

Start: 2018-06-27. End: 2024-09-30.

What is Dynetics, Inc.'s track record with similar defense simulation contracts?

Dynetics, Inc. has a history of engaging in complex defense-related projects, including work on advanced simulation, aerospace systems, and electronic warfare. While specific details on prior airborne threat simulation contracts of this exact scale are not immediately available in this data snippet, their general profile suggests they possess the technical expertise and experience necessary for such endeavors. Further due diligence would involve examining their past performance ratings, any awards or commendations received, and their involvement in previous simulation or modeling programs for the Department of Defense or other federal agencies. Their established presence in the defense sector implies a degree of familiarity with government contracting requirements and performance expectations.

How does the $33 million contract value compare to similar airborne threat simulation systems?

Direct comparison of the $33 million contract value for airborne threat simulation is difficult without granular data on the specific capabilities and scope of work. However, advanced simulation systems for military applications can vary widely in cost. Contracts for sophisticated simulators, including those involving realistic threat replication, can range from a few million dollars for component development or upgrades to tens or even hundreds of millions for full-system development and integration. The six-year duration of this contract suggests a substantial, long-term project, making the average annual spend of approximately $5.5 million appear reasonable for a specialized defense technology program. Benchmarking would ideally involve analyzing contracts for similar systems procured by different branches of the military or allied nations.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for this type of system?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract, like the one awarded to Dynetics, Inc., is the potential for cost overruns. While the fixed fee provides a predictable profit margin for the contractor, the government bears the risk of actual costs exceeding estimates. If the contractor's expenses are higher than anticipated due to unforeseen technical challenges, scope creep, or inefficient management, the total contract price will increase. This necessitates robust government oversight to scrutinize all incurred costs, ensure they are reasonable and allocable, and prevent unnecessary expenditures. The CPFF structure can sometimes disincentivize cost control by the contractor, as their profit is fixed regardless of the final cost, making diligent monitoring by the government crucial for value.

What is the expected effectiveness or program outcome of this contract?

The expected outcome of this contract is the development and delivery of advanced airborne threat simulation capabilities for the Department of the Navy. This is intended to enhance training realism for naval personnel, improve the effectiveness of combat systems by providing realistic testing environments, and potentially support research and development into new threat technologies. The ultimate goal is to improve operational readiness and mission success rates by allowing personnel to train and test under conditions that closely mimic real-world threats, thereby reducing risks and increasing proficiency in a safe, controlled environment.

How has federal spending in the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector evolved?

Federal spending within the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector (NAICS 334511) is typically driven by defense modernization priorities and technological advancements. Historically, this sector sees significant investment, particularly from the Department of Defense, for developing and procuring sophisticated systems. Spending levels can fluctuate based on geopolitical conditions, specific military requirements, and budget allocations. While this specific contract represents a $33 million award, broader trends in this sector involve substantial outlays for radar, sonar, navigation systems, and related instrumentation, often reflecting a continuous need to maintain technological superiority.

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: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6893614R0027

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1002 EXPLORER BLVD, HUNTSVILLE, AL, 35806

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

Financial Breakdown

Contract Ceiling: $34,326,570

Exercised Options: $34,326,570

Current Obligation: $32,997,326

Actual Outlays: $901,040

Subaward Activity

Number of Subawards: 26

Total Subaward Amount: $13,801,429

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6893617D0010

IDV Type: IDC

Timeline