DoD Awards Boeing $758.8M for Block 40/45 JBP Phase 3 Production
Contract Overview
Contract Amount: $758,766,191 ($758.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2011-11-17
End Date: 2024-11-15
Contract Duration: 4,747 days
Daily Burn Rate: $159.8K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: BLOCK 40/45 FULL RATE PRODUCTION JBP PHASE 3
Place of Performance
Location: TUKWILA, KING County, WASHINGTON, 98108
Plain-Language Summary
Department of Defense obligated $758.8 million to THE BOEING COMPANY for work described as: BLOCK 40/45 FULL RATE PRODUCTION JBP PHASE 3 Key points: 1. Significant contract value for advanced aircraft production. 2. Sole-source award to Boeing raises competition concerns. 3. Long duration suggests sustained program needs. 4. Cost-plus contract type may lead to cost overruns.
Value Assessment
Rating: questionable
The contract's cost-plus incentive fee structure, combined with a lack of available competition data, makes a direct pricing assessment difficult. The total award amount is substantial, and the incentive fee mechanism aims to control costs, but without benchmarks, value is hard to ascertain.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not available for competition, indicating a sole-source award to The Boeing Company. This limits price discovery and potentially increases costs for the government compared to a competitive bidding process.
Taxpayer Impact: The sole-source nature of this award means taxpayers may not benefit from the cost savings typically achieved through competitive procurement.
Public Impact
Ensures continued production of critical aircraft systems. Supports advanced capabilities for the Air Force. Sustains jobs within the aerospace manufacturing sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition.
- Cost-plus contract type can lead to cost overruns.
- Long contract duration increases risk exposure.
Positive Signals
- Supports critical defense capabilities.
- Long-term production ensures supply chain stability.
Sector Analysis
This contract falls within the Defense sector, specifically Aircraft Manufacturing. Spending in this area is critical for national security, but often involves high-value, complex procurements that can be prone to cost overruns and limited competition.
Small Business Impact
The data does not indicate any specific provisions or set-asides for small businesses in this contract. Large sole-source awards to major prime contractors often have limited direct subcontracting opportunities for small businesses, though they may benefit indirectly.
Oversight & Accountability
The Department of Defense oversees this contract. Given the sole-source nature and cost-plus fee structure, robust oversight is crucial to ensure cost control, performance, and adherence to contract terms.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award
- Cost-plus contract type
- Long contract duration
- Lack of competition
- Potential for cost overruns
Tags
aircraft-manufacturing, department-of-defense, wa, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $758.8 million to THE BOEING COMPANY. BLOCK 40/45 FULL RATE PRODUCTION JBP PHASE 3
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
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 $758.8 million.
What is the period of performance?
Start: 2011-11-17. End: 2024-11-15.
What is the historical cost performance of similar sole-source, cost-plus incentive fee contracts for aircraft production?
Historical data on similar sole-source, cost-plus incentive fee contracts in aircraft manufacturing often reveals a tendency for costs to exceed initial estimates. While the incentive fee structure aims to mitigate this, the lack of competition means the government relies heavily on effective negotiation and stringent oversight to achieve value. Benchmarking against comparable programs is essential for assessing cost efficiency.
What are the specific risks associated with the sole-source nature of this award and the long contract duration?
The primary risk of a sole-source award is the absence of competitive pressure, potentially leading to higher prices and reduced innovation. A long contract duration (nearly 13 years) amplifies this risk by locking the government into a single provider for an extended period, making it difficult to adapt to technological advancements or market changes. This also increases the potential for cost escalation over time.
How effectively does the incentive fee structure mitigate cost overruns in this specific contract?
The effectiveness of the incentive fee structure depends heavily on the realism of the target cost, the fairness of the sharing formula, and the clarity of the performance metrics. Without detailed insight into these parameters for this specific contract, it's difficult to definitively assess its effectiveness. However, incentive fees are generally considered a valuable tool for aligning contractor and government interests towards cost control.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Address: 7755 E MARGINAL WAY S, SEATTLE, WA, 98108
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $773,695,105
Exercised Options: $773,695,105
Current Obligation: $758,766,191
Subaward Activity
Number of Subawards: 232
Total Subaward Amount: $44,423,650
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: F1962801D0016
IDV Type: IDC
Timeline
Start Date: 2011-11-17
Current End Date: 2024-11-15
Potential End Date: 2024-11-15 00:00:00
Last Modified: 2025-09-25
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