DoD's $27.6M R&D contract with Rolls-Royce for engine technology, awarded via full and open competition

Contract Overview

Contract Amount: $27,626,726 ($27.6M)

Contractor: Rolls-Royce North American Technologies Inc

Awarding Agency: Department of Defense

Start Date: 2004-12-02

End Date: 2009-11-30

Contract Duration: 1,824 days

Daily Burn Rate: $15.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 142

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46241

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $27.6 million to ROLLS-ROYCE NORTH AMERICAN TECHNOLOGIES INC for work described as: Key points: 1. Contract awarded for advanced engine technology research and development. 2. Competition was robust, indicating potential for fair pricing. 3. Contract duration of 5 years suggests a long-term R&D focus. 4. Performance is likely tied to specific engine development milestones. 5. This contract falls within the aerospace and defense sector's R&D spending. 6. The use of Cost Plus Fixed Fee pricing requires careful oversight.

Value Assessment

Rating: fair

Benchmarking the value of this R&D contract is challenging without specific technical deliverables. However, the $27.6 million award over five years suggests a significant investment in engine technology. The Cost Plus Fixed Fee (CPFF) pricing structure means the government reimburses costs plus a fixed fee, which can lead to cost overruns if not managed tightly. Comparing this to similar R&D efforts in aerospace propulsion would provide a clearer picture of value for money, but such data is not readily available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' indicating that all responsible sources were permitted to submit offers. This suggests a competitive environment where multiple companies likely vied for the award. The presence of 142 offers (no) signifies a high level of interest and a potentially robust bidding process, which generally aids in price discovery and achieving competitive pricing.

Taxpayer Impact: A full and open competition is beneficial for taxpayers as it maximizes the pool of potential offerors, increasing the likelihood of receiving the best value and most innovative solutions at a competitive price.

Public Impact

The Department of the Air Force benefits from advancements in engine technology, potentially leading to improved aircraft performance and efficiency. This contract supports research and development in advanced aerospace propulsion systems. The geographic impact is primarily within Indiana, where Rolls-Royce North American Technologies Inc. is located. The contract likely supports a specialized workforce in engineering and research within the aerospace sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts require diligent oversight to manage costs and prevent overruns.
The long duration of the contract (1824 days) necessitates sustained monitoring of progress and adherence to R&D objectives.
The specific technical outcomes and their impact on future defense capabilities are not detailed, posing a risk of misaligned R&D focus.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that likely yielded fair pricing.
The significant number of offers (142) indicates strong market interest and a healthy competitive landscape for this technology area.
The contract supports critical research and development in a key defense technology area.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical sciences and engineering related to aerospace propulsion. The market for advanced engine technology is dominated by a few major players, including Rolls-Royce. This contract represents a significant investment by the Department of Defense in maintaining technological superiority in aviation, aligning with broader trends of government funding for innovation in critical defense industries.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss=false, sb=false). Given the nature of advanced aerospace R&D, it is likely that large, specialized contractors like Rolls-Royce are the primary recipients. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem in this high-value research.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract would typically involve the Department of Defense's contracting officers and technical representatives monitoring expenditures, progress reports, and adherence to the Statement of Work. Transparency is facilitated through contract award databases, but detailed programmatic oversight information is often internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Advanced Engine Development Programs
Aerospace Research and Technology Investments
Department of Defense Research and Development Funding
Propulsion Systems Innovation

Risk Flags

Cost Overrun Risk (CPFF)
Technical Scope Creep
Long-Term R&D Uncertainty
Dependency on Contractor Expertise

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.6 million to ROLLS-ROYCE NORTH AMERICAN TECHNOLOGIES INC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is ROLLS-ROYCE NORTH AMERICAN TECHNOLOGIES INC.

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 $27.6 million.

What is the period of performance?

Start: 2004-12-02. End: 2009-11-30.

What is the track record of Rolls-Royce North American Technologies Inc. in fulfilling similar R&D contracts with the Department of Defense?

Rolls-Royce North American Technologies Inc. has a history of engaging in complex R&D and manufacturing contracts, particularly within the aerospace and defense sectors. Their expertise in engine technology is well-established. While specific performance metrics for past DoD R&D contracts are not detailed here, their long-standing presence and significant awards suggest a generally capable contractor. However, a deeper dive into past contract performance reviews, such as CPARS (Contractor Performance Assessment Reporting System) data, would be necessary to fully assess their track record on similar R&D initiatives, looking for any patterns of cost overruns, schedule delays, or unmet technical objectives.

How does the awarded amount of $27.6 million compare to typical R&D spending for advanced engine technology within the DoD?

The $27.6 million awarded over approximately five years for advanced engine technology R&D is a substantial but not necessarily outlier figure for the defense sector. Major defense contractors often receive multi-million dollar awards for research into next-generation systems. To benchmark this effectively, one would need to compare it against the total R&D budgets allocated to aerospace propulsion across different branches of the DoD and against similar contracts awarded to competitors like General Electric Aviation. Without access to a broader dataset of comparable R&D contracts, it's difficult to definitively state if this represents high or low spending relative to the market, but it signifies a significant commitment to this technological area.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D, and how are they mitigated?

The primary risk with CPFF contracts, especially for R&D, is the potential for cost overruns. Since the contractor is reimbursed for all allowable costs plus a fixed fee, there is less incentive to control expenses compared to fixed-price contracts. This can lead to the government paying more than initially anticipated if costs escalate unexpectedly. Mitigation strategies include robust government oversight, detailed cost tracking, regular progress reviews, and clearly defined contract clauses that specify allowable costs and the process for fee determination. The fixed fee itself acts as a ceiling on the contractor's profit, but the total cost to the government can still exceed initial estimates.

What are the expected program effectiveness indicators for this R&D contract, given its focus on engine technology?

Program effectiveness for this R&D contract would likely be measured against specific technical milestones and performance goals outlined in the contract's Statement of Work (SOW). Key indicators could include achieving target improvements in engine efficiency (e.g., fuel burn reduction), power output, thrust-to-weight ratio, durability, or reduced emissions. Successful demonstration of new technologies through prototypes or simulations, adherence to budget and schedule, and the potential for future integration into operational aircraft systems would also signify effectiveness. Ultimately, the long-term effectiveness will be judged by whether the developed technology provides a tangible advantage or capability enhancement for the Air Force.

How has the Department of Defense's spending on aerospace R&D, particularly engine technology, trended over the past decade?

DoD spending on aerospace R&D, including engine technology, has historically fluctuated based on strategic priorities, technological advancements, and budget allocations. While a precise decade-long trend for engine-specific R&D isn't provided, overall defense R&D spending has seen periods of increase driven by modernization efforts and competition with potential adversaries. Investments in areas like advanced materials, digital engineering, and more fuel-efficient or higher-performance propulsion systems are typically prioritized. Analyzing historical budget documents and specific program funding levels would reveal whether spending in this niche has grown, remained stable, or decreased relative to other defense priorities.

What is the significance of the North American Technologies Inc. designation for Rolls-Royce in the context of this contract?

The 'North American Technologies Inc.' designation indicates this is a specific subsidiary or operating unit of Rolls-Royce focused on technological development and potentially manufacturing within North America, likely the United States. For this contract, it signifies that the R&D work is being performed by a U.S.-based entity, which can be important for national security considerations, intellectual property protection, and potentially for meeting domestic content requirements. It allows the DoD to contract with a significant global player through its established North American presence.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: BASIC RESEARCH

Offers Received: 142

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rolls-Royce Holdings PLC (UEI: 217127290)

Address: 2059 S TIBBS AVE, INDIANAPOLIS, IN, 46241

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: F3361503D2357

IDV Type: IDC

Timeline