DoD awards Northrop Grumman $141M for aircraft parts, raising concerns over competition and taxpayer value
Contract Overview
Contract Amount: $141,405,496 ($141.4M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2016-09-29
End Date: 2024-09-30
Contract Duration: 2,923 days
Daily Burn Rate: $48.4K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: NSN: 1560-01-456-4272 FW TRAILING EDGE, AIRCRAFT
Place of Performance
Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73135
State: Oklahoma Government Spending
Plain-Language Summary
Department of Defense obligated $141.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: NSN: 1560-01-456-4272 FW TRAILING EDGE, AIRCRAFT Key points: 1. Significant contract value of $141M for aircraft parts. 2. Sole-source award to Northrop Grumman limits competitive pricing. 3. Potential risk of overpayment due to lack of competition. 4. Spending falls within the 'Other Aircraft Parts' manufacturing sector.
Value Assessment
Rating: questionable
The contract value of $141M for aircraft parts is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar contracts for aircraft components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This significantly limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying a premium for these aircraft parts.
Public Impact
Taxpayers may be overpaying for essential aircraft components due to a lack of competitive bidding. The Department of Defense relies on a single supplier, potentially creating supply chain vulnerabilities. The long duration of the contract (until 2024) means sustained potential for inflated costs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High contract value
- Long contract duration
Positive Signals
- Established supplier
- Firm fixed price contract
Sector Analysis
This contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector. Spending in this sector can vary widely based on defense needs and technological advancements. Benchmarks are difficult without specific part comparisons.
Small Business Impact
The awardee is Northrop Grumman Systems Corporation, a large defense contractor. There is no indication that small businesses were involved in this specific sole-source award.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the government is receiving fair value. Accountability for pricing decisions is crucial given the lack of competitive pressure.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award limits competition.
- Potential for overpayment due to lack of price discovery.
- Long contract duration increases exposure to inflated costs.
- Lack of transparency in pricing justification.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, ok, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $141.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. NSN: 1560-01-456-4272 FW TRAILING EDGE, AIRCRAFT
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $141.4 million.
What is the period of performance?
Start: 2016-09-29. End: 2024-09-30.
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 urgent needs where only one vendor can fulfill the requirement. Without this specific justification, the lack of competition raises concerns about potential overpricing and missed opportunities for cost savings through competitive bidding.
How does the $141M contract value compare to industry benchmarks for similar aircraft parts?
Comparing the $141M contract value to industry benchmarks is challenging without detailed specifications of the 'FW TRAILING EDGE, AIRCRAFT' parts. However, given the sole-source nature, it is probable that the price is higher than it would be in a competitive environment. Further analysis would require detailed part specifications and market research.
What are the potential risks associated with a sole-source award for critical aircraft components?
The primary risks include inflated pricing, reduced innovation, and potential supply chain disruptions if the sole provider faces issues. The government loses leverage in negotiations and may become overly dependent on a single entity, impacting long-term cost-effectiveness and operational readiness.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 6401 S AIR DEPOT BLVD, OKLAHOMA CITY, OK, 73135
Business Categories: Category Business, Corporate Entity Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $141,405,496
Exercised Options: $141,405,496
Current Obligation: $141,405,496
Subaward Activity
Number of Subawards: 31
Total Subaward Amount: $198,314,130
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPE4AX16D9479
IDV Type: IDC
Timeline
Start Date: 2016-09-29
Current End Date: 2024-09-30
Potential End Date: 2024-09-30 00:00:00
Last Modified: 2025-11-19
More Contracts from Northrop Grumman Systems Corporation
- 200506!000026!5700!fa8214!oo-Alc/Pkme/Lmke !F4261098C0001 !A!N! !Y! !p01502!20041213!20050701!001563738!004179453!016435559!n!northrop Grumman Space & Missi!888 S 2000 E !clearfield !ut!84015!13850!011!49!clearfield !davis !utah !-000001960000!n!n!000000000000!l014!tech REP Svcs/Guided Missiles !A2 !missile and Space Systems !302 !minuteman III GRP !541330!E! !3! ! !C! ! !20200930!B! ! !A! !a!n!l!2!002!b! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! — $10.0B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-7) — $8.5B (Department of Defense)
- E-2D Advanced Hawkeye Aircraft (FRP-2) — $5.4B (Department of Defense)
- First DDT and E, Ares I-X, and Flight Tests. First Stage Will BE a Five Segment, Solid Rocket Booster Derived From the Space Shuttle Program (SSP) Solid Rocket Booster (srb)/Reusable Solid Rocket Motor (rsrm). the Contractor Shall Furnish the Necessary Management, Engineering, Labor, Facilities, Tools, Equipment, and Materials Required for First Stage Development, Qualification, Certification and Acceptance Program. Activities Include: Redesign and Testing of the Motor to Incorporate the Fifth Segment and Production of Five Full Scale Ground Static Test Motors: TWO Development Motors (dms)-And Three Qualification Motors (QMS); Structural Test Article (STA), Ground Vibration Test Motors (gvtms) and Other Development Testing; Redesign of the Avionics, Deceleration, Separation, and Flight Termination System (FTS) Subsystems; Ares I-X: Simulated Ares I Outer Mold Line/Mass Properties Using Modified Srb/Rsrm; and Three Flight Test Vehicles. TAS::80 0124::TAS — $4.4B (National Aeronautics and Space Administration)
- Federal Contract — $4.4B (Department of Defense)
View all Northrop Grumman Systems Corporation federal contracts →
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)