Sikorsky Aircraft Awarded $83.5M for Helicopter Rotor Blades, Drive Mechanisms, and Components for Black Hawk Helicopters

Contract Overview

Contract Amount: $156,310,573 ($156.3M)

Contractor: Sikorsky Aircraft Corporation

Awarding Agency: Department of Defense

Start Date: 2002-12-19

End Date: 2009-06-30

Contract Duration: 2,385 days

Daily Burn Rate: $65.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIXED PRICE

Sector: Defense

Official Description: 200312!001588!2100!AH23 !USA AVIATION AND MISSILE COMMAND!DAAH2302D0314 !A!N! !N!0001 !20021219!20081231!835551474!835551474!001344142!N!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN STREET !STRATFORD !CT!06615!74260!001!09!STRATFORD !FAIRFIELD !CONN !+000158410706!N!N!000000000000!1615!HELICOPTER ROTOR BLADES, DRIVE MECHANISMS & COMPON!A1C!OTHER AIRCRAFT EQUIPMENT !1AIA!BLACKHAWK (UH-60) UTTAS !336413!E! !5!B!S! ! ! !99990909!B! ! !A! !D!N!J!1!001!N!1G!A!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: STRATFORD, FAIRFIELD County, CONNECTICUT, 06614

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $156.3 million to SIKORSKY AIRCRAFT CORPORATION for work described as: 200312!001588!2100!AH23 !USA AVIATION AND MISSILE COMMAND!DAAH2302D0314 !A!N! !N!0001 !20021219!20081231!835551474!835551474!001344142!N!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN STREET !STRATFORD !CT!06615!74260!001!09!STRATFORD !FAIRF… Key points: 1. Contract awarded for critical helicopter components, indicating ongoing support for aviation platforms. 2. The contract's fixed-price nature suggests a defined cost structure, though potential for cost overruns exists. 3. Sole-source award raises questions about competition and potential impact on pricing efficiency. 4. Long performance period of over 6 years suggests a sustained need for these components. 5. The award falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code, a specialized segment of the aerospace industry. 6. Focus on Black Hawk (UH-60) components highlights the enduring operational significance of this helicopter model.

Value Assessment

Rating: fair

The total value of this contract is $83.5 million over approximately 6.5 years. Without specific benchmarks for rotor blades and drive mechanisms for the UH-60, a precise value-for-money assessment is challenging. However, the fixed-price nature provides some cost certainty. Comparing this to other sole-source awards for similar complex aviation components would be necessary for a more robust evaluation of its pricing efficiency and overall value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities, technology, or proprietary rights to fulfill the requirement. The lack of competition means that the government did not benefit from a bidding process that could have driven down prices through market forces.

Taxpayer Impact: A sole-source award limits the government's ability to secure the best possible price through competitive bidding, potentially leading to higher costs for taxpayers.

Public Impact

The primary beneficiaries are the U.S. Army and potentially other branches operating the Black Hawk (UH-60) helicopter, ensuring continued operational readiness. Services delivered include the provision of essential components like rotor blades and drive mechanisms, critical for helicopter flight. The geographic impact is primarily within Connecticut, where Sikorsky Aircraft Corporation is located, supporting local manufacturing and employment. Workforce implications include the maintenance of skilled manufacturing jobs within the aerospace sector at Sikorsky and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing, potentially increasing costs for taxpayers.
Lack of competition may reduce incentives for innovation and efficiency from the contractor.
Long contract duration could mask inefficiencies if not closely monitored.
Reliance on a single supplier for critical components poses a supply chain risk.

Positive Signals

Ensures continued availability of critical components for a vital military platform (UH-60 Black Hawk).
Fixed-price contract provides a degree of cost predictability.
Sikorsky Aircraft Corporation is a well-established manufacturer with a track record in helicopter production.

Sector Analysis

This contract falls within the aerospace manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. The market for such specialized components is often characterized by high barriers to entry due to technological complexity, stringent quality requirements, and established relationships with defense agencies. Spending in this area is directly tied to the operational needs and fleet sustainment of military aviation assets. Comparable spending benchmarks would involve analyzing other contracts for similar high-value, specialized aircraft components across different military branches.

Small Business Impact

This contract does not appear to have a small business set-aside. As a sole-source award to a large corporation, it is unlikely to involve significant subcontracting opportunities for small businesses unless explicitly mandated by the prime contractor or the contracting agency. The absence of a set-aside means that small businesses in this specialized manufacturing niche did not have a direct opportunity to compete for this specific award.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Army's contracting and program management offices. Accountability measures would include performance monitoring, quality assurance checks, and adherence to the fixed-price terms. Transparency is generally limited for sole-source awards, with details often restricted due to proprietary or national security concerns. The Inspector General's office for the Department of Defense would have jurisdiction to investigate any allegations of fraud, waste, or abuse.

Related Government Programs

UH-60 Black Hawk Helicopter Sustainment
Aerospace Parts Manufacturing
Defense Aviation Component Procurement
Rotorcraft Component Support
Military Helicopter Fleet Maintenance

Risk Flags

Sole Source Justification
Potential for High Cost
Supply Chain Dependency
Lack of Competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $156.3 million to SIKORSKY AIRCRAFT CORPORATION. 200312!001588!2100!AH23 !USA AVIATION AND MISSILE COMMAND!DAAH2302D0314 !A!N! !N!0001 !20021219!20081231!835551474!835551474!001344142!N!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN STREET !STRATFORD !CT!06615!74260!001!09!STRATFORD !FAIRFIELD !CONN !+000158410706!N!N!000000000000!1615!HELICOPTER ROTOR BLADES, DRIVE MECHANISMS & COMPON!A1C!OTHER AIRCRAFT EQUIPMENT !1AIA!BLACKHAWK (UH-60) UTTAS !336413!E! !5!B!S! ! ! !99990909!B

Who is the contractor on this award?

The obligated recipient is SIKORSKY AIRCRAFT CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $156.3 million.

What is the period of performance?

Start: 2002-12-19. End: 2009-06-30.

What is Sikorsky Aircraft Corporation's track record with the U.S. Army for UH-60 Black Hawk components?

Sikorsky Aircraft Corporation, now part of Lockheed Martin, has a long and established history as the original manufacturer of the UH-60 Black Hawk helicopter. They have consistently been a primary supplier of the aircraft itself, as well as critical components and support services throughout the helicopter's operational life. Their track record with the Army for these components is extensive, marked by numerous contracts for production, upgrades, and sustainment. This deep historical relationship and specialized knowledge are often factors contributing to sole-source justifications for critical parts where they are the original equipment manufacturer (OEM) or possess unique manufacturing capabilities.

How does the $83.5 million contract value compare to historical spending on similar Black Hawk components?

Assessing the $83.5 million value against historical spending requires detailed data on specific component types (rotor blades, drive mechanisms) and contract durations. Without granular historical data for these exact components, a direct comparison is difficult. However, given the complexity and critical nature of rotor systems and drivetrains, this value appears substantial but not necessarily out of line for a multi-year supply of such parts for a widely deployed platform like the UH-60. Historical spending on Black Hawk sustainment programs generally runs into billions of dollars annually, and this contract represents a portion of that overall sustainment effort.

What are the primary risks associated with this sole-source contract for helicopter components?

The primary risks associated with this sole-source contract include a lack of price competition, which can lead to higher costs for the government compared to a competitively bid contract. There's also a risk of contractor complacency, where the absence of competitive pressure might reduce the incentive for cost efficiency or innovation. Furthermore, reliance on a single supplier for critical components creates a potential supply chain vulnerability; any disruption at Sikorsky could significantly impact the operational readiness of the Black Hawk fleet. Finally, without competitive benchmarking, it's harder to ensure the government is receiving optimal value for its investment.

How effective is the U.S. Army in ensuring value for money on sole-source contracts for aviation parts?

The U.S. Army employs several mechanisms to ensure value for money on sole-source contracts, though challenges remain. These include conducting thorough market research to confirm the necessity of a sole-source award, negotiating prices based on cost analysis (evaluating contractor's labor, material, and overhead costs), and incorporating performance metrics and incentives where possible. However, the inherent lack of competition means that the government's negotiating position is weaker. Effectiveness can vary depending on the specific item, the contractor's market power, and the diligence of the contracting team in challenging proposed costs and ensuring fair pricing.

What is the typical contract structure for sustainment of major military aircraft like the Black Hawk?

Contracts for the sustainment of major military aircraft like the Black Hawk typically involve a mix of contract types and structures. This can include long-term sustainment agreements, performance-based logistics contracts, and individual delivery orders for specific parts or services. Often, contracts are awarded to the original equipment manufacturer (OEM) on a sole-source or limited-competition basis for unique or proprietary components, as seen here. Other aspects, like depot maintenance or broader fleet support, might be competed. The goal is to ensure availability, reliability, and affordability over the aircraft's lifecycle, balancing the need for specialized OEM support with competitive pressures where feasible.

Are there alternative suppliers for critical Black Hawk helicopter components like rotor blades and drive mechanisms?

For highly specialized and proprietary components like rotor blades and drive mechanisms for the UH-60 Black Hawk, the original equipment manufacturer (OEM), Sikorsky (now Lockheed Martin), typically holds the primary manufacturing rights and technical data. While the Army may seek to qualify alternative sources for certain parts to enhance competition and reduce risk, this process can be lengthy, costly, and technically challenging. It requires extensive testing and validation to ensure that parts from a new supplier meet the stringent performance and safety standards. Therefore, for many critical systems, the OEM often remains the sole or primary source for extended periods.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIXED PRICE (J)

Contractor Details

Parent Company: RTX Corp (UEI: 001344142)

Address: 6900 MAIN STREET, STRATFORD, CT, 06615

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: DAAH2302D0314

IDV Type: IDC

Timeline