DoD's $208M rotary wing transport contract in Afghanistan awarded via full and open competition

Contract Overview

Contract Amount: $208,121,145 ($208.1M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 2010-09-30

End Date: 2014-10-31

Contract Duration: 1,492 days

Daily Burn Rate: $139.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ROTARY WING PASSENGER AND CARGO MOVEMENT IN AFGHANISTAN.

Plain-Language Summary

Department of Defense obligated $208.1 million to CANADIAN COMMERCIAL CORPORATION for work described as: ROTARY WING PASSENGER AND CARGO MOVEMENT IN AFGHANISTAN. Key points: 1. Contract aimed to provide essential passenger and cargo movement in a high-risk environment. 2. Full and open competition suggests a robust market for these services. 3. Contract duration of nearly 5 years indicates a significant, ongoing need. 4. Firm Fixed Price contract type offers cost certainty for the government. 5. The award to Canadian Commercial Corporation highlights international cooperation in defense logistics. 6. Performance occurred during a critical period of the Afghanistan conflict.

Value Assessment

Rating: fair

The total contract value of $208 million over approximately 4 years represents a substantial investment in logistical support. Benchmarking this specific type of rotary wing transport in a combat zone is challenging due to unique operational risks and costs. However, the firm fixed-price structure suggests an attempt to control costs. Without detailed breakdowns of flight hours, aircraft types, and specific routes, a precise value-for-money assessment is difficult, but the scale implies significant operational requirements were met.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were likely solicited and allowed to bid. The presence of 11 bids (no=11) suggests a competitive marketplace for these specialized aviation services. This level of competition is generally favorable for price discovery and potentially achieving better pricing for the government.

Taxpayer Impact: A competitive bidding process helps ensure taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

Beneficiaries include U.S. and allied military forces operating in Afghanistan, ensuring personnel and equipment reach critical locations. Services delivered are essential for maintaining operational readiness and logistical flow in a challenging theater. Geographic impact is concentrated within Afghanistan, supporting military operations across the country. Workforce implications include pilots, maintenance crews, and support staff, likely a mix of civilian and potentially contractor personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Operating in a conflict zone presents inherent risks to personnel and equipment.
Dependence on a single contract for critical logistics could pose a risk if performance issues arise.
Geopolitical instability in Afghanistan could impact operational continuity and costs.

Positive Signals

Firm Fixed Price contract provides cost predictability.
Full and open competition suggests a healthy market and potential for competitive pricing.
Award to a Canadian entity may indicate strong allied cooperation in logistics.

Sector Analysis

This contract falls within the broader aerospace and defense sector, specifically focusing on specialized aviation services. The market for military air transport, particularly in austere or combat environments, is characterized by high barriers to entry due to stringent safety, security, and operational requirements. Spending in this area is often driven by geopolitical commitments and national security objectives. Comparable spending benchmarks are difficult to establish due to the unique nature of the operating environment.

Small Business Impact

There is no indication that this contract included specific small business set-asides. Given the specialized nature of rotary wing transport in a conflict zone, it is likely that larger, experienced aerospace and defense contractors or specialized aviation firms were the primary bidders. Subcontracting opportunities for small businesses might exist in areas such as catering, ground support, or specialized equipment provision, but this is not explicitly detailed.

Oversight & Accountability

Oversight would typically be managed by the U.S. Transportation Command (USTRANSCOM) and potentially the Department of Defense's Inspector General. Contract performance monitoring, adherence to flight safety standards, and financial accountability would be key oversight areas. Transparency is generally maintained through contract award databases, though specific operational details might be classified or sensitive.

Related Government Programs

Rotary Wing Aircraft Maintenance
Air Cargo Transportation
Military Logistics Support
Afghanistan Reconstruction Support
Aerospace Defense Services

Risk Flags

Operational Risk in Conflict Zone
Logistical Complexity
Geopolitical Instability
Contractor Performance Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $208.1 million to CANADIAN COMMERCIAL CORPORATION. ROTARY WING PASSENGER AND CARGO MOVEMENT IN AFGHANISTAN.

Who is the contractor on this award?

The obligated recipient is CANADIAN COMMERCIAL CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (USTRANSCOM).

What is the total obligated amount?

The obligated amount is $208.1 million.

What is the period of performance?

Start: 2010-09-30. End: 2014-10-31.

What was the contractor's track record prior to this award?

Information regarding the specific track record of the Canadian Commercial Corporation (CCC) concerning this particular contract is not detailed in the provided data. CCC acts as a facilitator for Canadian companies seeking to do business with foreign governments and international organizations. Their role often involves managing contracts awarded to Canadian firms. Therefore, the performance history would likely be attributed to the specific Canadian aviation company(ies) that CCC represented for this contract. Further investigation into CCC's procurement history and the specific subcontractors involved would be necessary to assess their prior performance in similar operations.

How does the cost per flight hour compare to similar contracts?

A direct comparison of the cost per flight hour for this contract to similar ones is challenging without more granular data. The provided information includes the total contract value ($208M) and duration (approx. 4 years), but not the number of flight hours or the specific types of rotary wing aircraft utilized. Contracts for rotary wing transport in conflict zones are typically higher than those in stable environments due to increased operational complexity, risk premiums, insurance costs, and specialized maintenance requirements. Benchmarking would require access to detailed cost breakdowns, aircraft utilization rates, and operational theaters of comparable contracts.

What were the primary risks identified for this contract?

The primary risks associated with this contract would have been centered around the operational environment in Afghanistan. These include security risks to personnel and aircraft due to hostile actions, potential for equipment damage or loss, and the logistical challenges of operating in a geographically vast and underdeveloped region. Furthermore, political instability, changes in mission requirements, and potential for mission creep could also pose risks. The firm fixed-price nature of the contract also places the risk of cost overruns on the contractor, assuming they accurately estimated their costs.

How effective was this contract in meeting its objectives?

The effectiveness of this contract in meeting its objectives—providing rotary wing passenger and cargo movement in Afghanistan—can be inferred from its duration and scale. A nearly five-year contract valued at over $200 million suggests sustained demand and likely successful fulfillment of critical logistical needs for military operations during that period. However, a definitive assessment of effectiveness would require analysis of mission success rates, on-time delivery metrics, safety records, and feedback from the end-users (military units) during the contract period.

What were historical spending patterns for similar services?

Historical spending patterns for similar rotary wing passenger and cargo movement services in Afghanistan prior to this contract would likely show a consistent need driven by ongoing military operations. The U.S. Department of Defense has historically allocated significant resources to aviation support in theaters like Afghanistan. Spending would fluctuate based on troop levels, operational tempo, and the specific phases of the conflict. This $208 million contract represents a substantial, but potentially typical, investment for a multi-year period during peak operational years.

What is the significance of the contract type (Firm Fixed Price)?

The Firm Fixed Price (FFP) contract type is significant because it shifts the majority of the financial risk from the government to the contractor. Under an FFP contract, the price is set and not subject to adjustment based on the contractor's cost experience. This provides the government with cost certainty and predictability. For the contractor, it incentivizes efficient performance and cost control, as any savings achieved below the fixed price contribute directly to their profit. This type of contract is generally preferred when the scope of work is well-defined and risks can be reasonably assessed.

Industry Classification

NAICS: Transportation and Warehousing › Nonscheduled Air Transportation › Nonscheduled Chartered Passenger Air Transportation

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRAVEL, LODGING, RECRUITMENT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HTC71110RR001

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Government of Canada (UEI: 241015486)

Address: 50 O'CONNOR ST SUITE 1100, OTTAWA

Business Categories: Category Business, Foreign Government, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $254,529,275

Exercised Options: $208,121,145

Current Obligation: $208,121,145

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71110DR025

IDV Type: IDC

Timeline