FAA Awards $1.5 Billion Contract for Air Traffic Control Modernization

The FAA announced that its contract with national security firm Peraton is worth $1.5 billion as part of a larger $12.5 billion effort to modernize the aging U.S. air traffic control (ATC) system. President Trump negotiated a $200 million reduction from the initial proposed contract price. The agreement includes a strict “No Excuses” structure, meaning payments depend on meeting schedule, cost, quality, and management targets. The modernization plan focuses on replacing outdated systems at 318 FAA facilities by shifting to a cloud-based infrastructure, upgrading telecommunications from copper to fiber and wireless, and installing 612 new radar systems by June 2028 at a cost of $1.1 billion. So far, $1.6 billion has been obligated. An additional $19–$20 billion may be required to complete the overhaul. The project aims to address long-standing issues such as congestion, outdated technology, staffing shortages, and system reliability, while allowing the FAA to take a multi-year modernization approach. Short criteriums for U.S. manufacturers: • Compliance with Buy American and federal procurement rules • Strong cybersecurity standards (NIST, defense-level requirements if applicable) • Capability in cloud, telecom, radar, and aviation-grade systems • Ability to meet strict cost, schedule, and quality targets • Secure, domestic supply chains • Skilled workforce and production capacity