DoD's $68M ScanEagle UAV Contract Awarded to Insitu, Inc. Raises Competition Concerns
Contract Overview
Contract Amount: $67,998,060 ($68.0M)
Contractor: Insitu, Inc.
Awarding Agency: Department of Defense
Start Date: 2015-11-25
End Date: 2018-06-30
Contract Duration: 948 days
Daily Burn Rate: $71.7K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: IGF::OT::IGF SCANEAGLE UAV'S
Place of Performance
Location: BINGEN, KLICKITAT County, WASHINGTON, 98605
Plain-Language Summary
Department of Defense obligated $68.0 million to INSITU, INC. for work described as: IGF::OT::IGF SCANEAGLE UAV'S Key points: 1. Significant spending on unmanned aerial vehicles (UAVs) for defense applications. 2. Sole-source award to Insitu, Inc. limits competitive pricing and innovation. 3. Potential for higher costs due to lack of competition. 4. Research and Development sector spending, with implications for future defense capabilities.
Value Assessment
Rating: questionable
The contract value of $67.99M for ScanEagle UAVs is substantial. Without available benchmark data or competitive pricing, it's difficult to definitively assess value for money. The firm fixed price contract type is positive, but the lack of competition is a significant concern.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not available for competition, indicating a sole-source award. This significantly limits price discovery and potentially leads to inflated costs for taxpayers. The rationale for sole-source is not provided, which warrants further investigation.
Taxpayer Impact: The lack of competition likely results in higher prices than could be achieved through a competitive bidding process, impacting taxpayer value.
Public Impact
Taxpayers may be overpaying for ScanEagle UAVs due to the absence of competitive bidding. Limited transparency into the justification for a sole-source award raises accountability questions. Potential impact on the broader defense industrial base by not fostering competition among UAV providers.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Limited price discovery
- Unclear justification for sole-source
Positive Signals
- Firm fixed price contract
- Delivery order award mechanism
Sector Analysis
This contract falls within the Research and Development sector, specifically for physical and engineering sciences. Defense spending in this area is crucial for technological advancement, but competitive procurement is vital to ensure efficient use of funds.
Small Business Impact
The data does not indicate whether small businesses were involved in this contract, either as prime contractors or subcontractors. Further analysis would be needed to determine the impact on small business participation.
Oversight & Accountability
The sole-source nature of this award raises questions about the oversight process that led to this determination. A review of the justification for excluding competition is recommended to ensure accountability and adherence to procurement regulations.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competition
- Potential for overpricing
- Limited transparency on sole-source justification
- No small business participation data
- Difficulty in value assessment
Tags
research-and-development-in-the-physical, department-of-defense, wa, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $68.0 million to INSITU, INC.. IGF::OT::IGF SCANEAGLE UAV'S
Who is the contractor on this award?
The obligated recipient is INSITU, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $68.0 million.
What is the period of performance?
Start: 2015-11-25. End: 2018-06-30.
What was the specific justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
The provided data states the contract was 'NOT AVAILABLE FOR COMPETITION,' implying a sole-source determination. However, the specific justification and the process by which alternatives were evaluated are not detailed. Understanding this rationale is crucial for assessing whether taxpayer funds were used efficiently and if the government explored all viable options to foster competition and achieve better pricing.
How does the cost of the ScanEagle UAV under this sole-source contract compare to similar systems procured competitively, if available?
Without access to comparable contract data for similar UAV systems procured through competitive means, a direct cost comparison is not possible. The absence of competition inherently makes it difficult to benchmark pricing effectively. A thorough market research analysis would be required to identify comparable systems and assess whether Insitu's pricing is reasonable in the broader market context.
What is the long-term strategic impact of awarding significant UAV contracts on a sole-source basis to the overall defense industrial base and technological innovation?
Sole-source awards, while sometimes necessary, can stifle innovation and limit the growth of competing firms within the defense industrial base. Over-reliance on single-source providers for critical technologies like UAVs may reduce market dynamism, potentially leading to higher long-term costs and slower technological advancement compared to a robustly competitive environment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: THE Boeing Company
Address: 118 E COLUMBIA RIVER WAY, BINGEN, WA, 98605
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $67,998,062
Exercised Options: $67,998,062
Current Obligation: $67,998,060
Subaward Activity
Number of Subawards: 10
Total Subaward Amount: $2,595,524
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N6833511G0009
IDV Type: BOA
Timeline
Start Date: 2015-11-25
Current End Date: 2018-06-30
Potential End Date: 2018-06-30 00:00:00
Last Modified: 2022-07-11
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