Vertex Aerospace LLC contract for aircraft maintenance exceeds $728M, awarded via full and open competition

Contract Overview

Contract Amount: $728,257,108 ($728.3M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2009-02-02

End Date: 2012-07-31

Contract Duration: 1,275 days

Daily Burn Rate: $571.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: TIME AND MATERIALS

Sector: Defense

Official Description: FIELD AND SUSTAINMENT LEVEL MAINTENANCE IN SUPPORT OF AIRCRAFT DEPLOYED IN THE USARCENT AOR

Place of Performance

Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73135

State: Oklahoma Government Spending

Plain-Language Summary

Department of Defense obligated $728.3 million to VERTEX AEROSPACE LLC for work described as: FIELD AND SUSTAINMENT LEVEL MAINTENANCE IN SUPPORT OF AIRCRAFT DEPLOYED IN THE USARCENT AOR Key points: 1. Contract value indicates significant long-term investment in aircraft sustainment. 2. Full and open competition suggests a potentially competitive pricing environment. 3. Contract duration and value may present performance risks if not managed effectively. 4. Focus on field and sustainment level maintenance highlights critical operational support. 5. Award to a single entity implies a need for robust oversight. 6. The contract's scale suggests a substantial impact on the aerospace maintenance sector.

Value Assessment

Rating: fair

The total contract value of over $728 million for aircraft maintenance is substantial. Benchmarking this against similar large-scale sustainment contracts is challenging without more specific service details. However, the duration of the contract (over 10 years including options) suggests a significant commitment. The pricing structure, likely time and materials, requires careful monitoring to ensure value for money, as costs can escalate if not controlled.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of 7 bidders suggests a reasonably competitive landscape, which should theoretically drive better pricing and service offerings. This level of competition is generally favorable for the government.

Taxpayer Impact: Full and open competition typically benefits taxpayers by fostering a market that encourages competitive pricing and innovation, potentially leading to lower overall costs for essential services like aircraft maintenance.

Public Impact

USARCENT (US Army Central Command) deployed aircraft benefit from enhanced readiness and operational capability. Services include critical field and sustainment level maintenance, ensuring aircraft airworthiness. Geographic impact is primarily within the USARCENT Area of Responsibility, supporting military operations. Workforce implications include skilled aviation mechanics and support personnel, potentially creating jobs in the aerospace sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns with time and materials pricing over a long contract duration.
Ensuring consistent quality of maintenance across all deployed aircraft requires stringent oversight.
Dependency on a single contractor for critical sustainment could pose risks if performance degrades.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
The contract's scale suggests the contractor has the capacity to handle significant workload.
Long-term nature of the contract allows for specialized knowledge development and consistent support.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aircraft maintenance and sustainment. The market for aircraft MRO (Maintenance, Repair, and Overhaul) is substantial, driven by military and commercial aviation needs. This contract represents a significant portion of spending for specialized sustainment services within a specific military command's operational area.

Small Business Impact

Information regarding small business set-asides or subcontracting plans is not explicitly provided in the data. Given the large contract value and specialized nature of aircraft maintenance, it is possible that larger aerospace firms are the primary awardees. Further analysis would be needed to determine if small businesses are involved as subcontractors or if there are specific set-aside goals.

Oversight & Accountability

Oversight mechanisms would typically involve the Air Force contracting officers and program managers responsible for monitoring performance, quality, and cost. Accountability measures are embedded in the contract terms, including potential penalties for non-performance. Transparency is generally facilitated through contract award databases, though detailed performance metrics may not always be public.

Related Government Programs

Aircraft Maintenance Services
Aerospace Sustainment Contracts
Military Logistics Support
Defense Aviation Support
USARCENT Operations Support

Risk Flags

Long-term contract with time and materials pricing increases risk of cost overruns.
Significant contract value necessitates robust oversight to ensure value for money.
Dependency on a single contractor for critical sustainment requires performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $728.3 million to VERTEX AEROSPACE LLC. FIELD AND SUSTAINMENT LEVEL MAINTENANCE IN SUPPORT OF AIRCRAFT DEPLOYED IN THE USARCENT AOR

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $728.3 million.

What is the period of performance?

Start: 2009-02-02. End: 2012-07-31.

What is the historical spending trend for aircraft maintenance within USARCENT?

Analyzing historical spending trends for aircraft maintenance within USARCENT requires access to detailed budget and contract data over multiple fiscal years. Without specific historical data points, it's difficult to establish a trend. However, the award of a large, multi-year contract like this suggests a consistent and significant need for these services. Fluctuations in spending could be influenced by operational tempo, aircraft fleet size and age, and evolving maintenance strategies. A trend analysis would involve comparing annual expenditures on similar contracts or service categories to identify patterns of increase, decrease, or stability in investment.

How does Vertex Aerospace LLC's performance on similar contracts compare to industry benchmarks?

Assessing Vertex Aerospace LLC's performance on similar contracts requires access to performance evaluations, past performance questionnaires, and potentially debriefing information from previous awards. Benchmarking against industry standards would involve comparing metrics such as on-time delivery, quality of work, cost control, and responsiveness to issues. Without specific performance data for Vertex on comparable contracts, a direct comparison is not feasible. However, the fact that they were awarded this substantial contract suggests a positive past performance record that met the Air Force's criteria. Further investigation into contractor performance databases and award histories would be necessary for a comprehensive assessment.

What are the key performance indicators (KPIs) used to measure the success of this contract?

Key Performance Indicators (KPIs) for a contract of this nature typically focus on ensuring aircraft readiness and operational availability. These could include metrics such as the Mean Time Between Failures (MTBF), Mean Time To Repair (MTTR), aircraft availability rates, turnaround time for maintenance tasks, and adherence to scheduled maintenance. Quality assurance metrics, such as the number of repeat defects or findings from inspections, would also be critical. The contract likely specifies these KPIs, and performance against them would dictate contractor payment and potentially influence future contract awards.

What is the estimated cost per flight hour for the aircraft supported under this contract?

Estimating the cost per flight hour for aircraft supported under this contract is complex and requires detailed cost breakdowns that are not publicly available. The contract is for maintenance services, not flight operations, and uses a time and materials pricing structure. To calculate cost per flight hour, one would need to know the total maintenance cost allocated to this contract, the total number of flight hours accumulated by the supported aircraft during the contract period, and potentially factor in the type and age of the aircraft. This information is typically proprietary and not disclosed in public contract award data.

What is the potential impact of technological advancements on the long-term sustainment needs covered by this contract?

Technological advancements can significantly impact long-term sustainment needs. For this contract, advancements in areas like predictive maintenance (using sensors and AI to anticipate failures), additive manufacturing (3D printing of parts), and improved diagnostic tools could lead to more efficient and cost-effective maintenance. Conversely, new technologies might require different skill sets for maintenance personnel or necessitate upgrades to existing aircraft, potentially altering the scope of sustainment services. The contract's duration allows for adaptation, but the Air Force and Vertex Aerospace will need to monitor technological shifts to ensure the sustainment strategy remains optimal and cost-effective over the contract's life.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 7

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)

Address: 8001 MID AMERICA BLVD #500, OKLAHOMA CITY, OK, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $1,404,783,166

Exercised Options: $769,433,217

Current Obligation: $728,257,108

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA810809D0005

IDV Type: IDC

Timeline