DHS Coast Guard awards $183.6M firm-fixed-price contract for two fixed-wing aircraft to Gulfstream Aerospace

Contract Overview

Contract Amount: $183,603,454 ($183.6M)

Contractor: Gulfstream Aerospace Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2025-10-17

End Date: 2027-03-17

Contract Duration: 516 days

Daily Burn Rate: $355.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PURCHASE OF TWO (2) FIXED-WING AIRCRAFT.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20593

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $183.6 million to GULFSTREAM AEROSPACE CORPORATION for work described as: PURCHASE OF TWO (2) FIXED-WING AIRCRAFT. Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. High value contract for specialized aviation assets. 3. Firm-fixed-price structure shifts cost risk to the contractor. 4. Contract duration of over 4 years suggests a significant operational need. 5. Procurement of new aircraft indicates a need for fleet modernization or expansion. 6. The specific model and capabilities of the aircraft are key to assessing value.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific aircraft model details and performance requirements. However, the acquisition of two new fixed-wing aircraft at over $183 million suggests a substantial investment. The firm-fixed-price nature of the contract provides cost certainty for the government, but the lack of competition raises concerns about whether the best possible price was achieved. Comparison to similar government procurements of specialized aircraft would be necessary for a more definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Gulfstream Aerospace Corporation, was solicited. This significantly limits the opportunity for price discovery and competition, which typically drives down costs for the government. Without a competitive bidding process, it is difficult to ascertain if the awarded price reflects the most economical option available in the market.

Taxpayer Impact: The lack of competition means taxpayers may not have received the benefit of a lower price that could have resulted from multiple bids. This approach bypasses the standard process designed to ensure competitive pricing and maximize taxpayer value.

Public Impact

The U.S. Coast Guard will benefit from the acquisition of two new fixed-wing aircraft. These aircraft are intended to support critical Coast Guard missions, likely including maritime surveillance, search and rescue, and law enforcement. The operational impact will be felt across the Coast Guard's area of responsibility. The acquisition may have implications for the aviation maintenance and pilot workforce within the Coast Guard.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential taxpayer savings.
High contract value necessitates rigorous justification and oversight.
Lack of detailed aircraft specifications in the provided data makes independent value assessment difficult.

Positive Signals

Firm-fixed-price contract shifts cost overrun risk to the contractor.
Acquisition of new assets suggests investment in enhanced operational capabilities.
Long contract duration indicates a sustained need for the procured services/assets.

Sector Analysis

The aerospace and defense sector is characterized by high R&D costs, long product development cycles, and significant government procurement. This contract falls within the segment of commercial aviation equipment, specifically for specialized government use. The market for such high-end, mission-capable aircraft is often concentrated among a few key manufacturers, which can influence competition dynamics. Comparable spending benchmarks would involve analyzing other government acquisitions of similar fixed-wing aircraft, considering factors like payload, range, and avionics.

Small Business Impact

This contract does not appear to involve a small business set-aside, as it was awarded directly to Gulfstream Aerospace Corporation, a large aerospace manufacturer. There is no information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, unless Gulfstream engages small businesses for support services or components.

Oversight & Accountability

Oversight for this contract will primarily reside with the U.S. Coast Guard contracting and program management offices. As a sole-source award, it may warrant additional scrutiny from oversight bodies like the Government Accountability Office (GAO) or the Department of Homeland Security's Office of Inspector General (OIG) to ensure the justification for sole-sourcing and the pricing are appropriate. Transparency regarding the specific justification for the sole-source award and the detailed technical specifications of the aircraft would enhance accountability.

Related Government Programs

U.S. Coast Guard Aviation Procurement
Department of Homeland Security Aircraft Acquisitions
Fixed-Wing Aircraft Procurement
Specialized Government Aircraft

Risk Flags

Sole-source award
High contract value
Lack of detailed specifications

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $183.6 million to GULFSTREAM AEROSPACE CORPORATION. PURCHASE OF TWO (2) FIXED-WING AIRCRAFT.

Who is the contractor on this award?

The obligated recipient is GULFSTREAM AEROSPACE CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $183.6 million.

What is the period of performance?

Start: 2025-10-17. End: 2027-03-17.

What specific mission requirements necessitate the purchase of these two fixed-wing aircraft from Gulfstream Aerospace?

The provided data does not specify the exact mission requirements driving this procurement. However, the U.S. Coast Guard typically utilizes fixed-wing aircraft for a range of critical operations including long-range maritime surveillance, search and rescue coordination, intelligence, surveillance, and reconnaissance (ISR), and law enforcement support. The acquisition of new aircraft suggests a need for enhanced capabilities, extended range, improved sensor integration, or fleet modernization to replace aging assets. Understanding the specific operational gaps these new aircraft are intended to fill is crucial for assessing their necessity and value.

How does the $183.6 million price compare to market rates for similar Gulfstream aircraft or comparable government procurements?

Without knowing the specific Gulfstream model and its configuration (e.g., avionics, mission systems), a precise comparison is difficult. However, Gulfstream's large cabin business jets, such as the G650 or G700, can have list prices in the $60-75 million range before customization. For government applications, extensive modifications for surveillance, communication, and other specialized equipment can significantly increase the final cost. The $183.6 million total for two aircraft, averaging $91.8 million each, suggests either high-end, customized models or a significant markup due to the sole-source nature and specialized requirements. A detailed review of similar sole-source or competitive procurements for comparable government-configured aircraft would be needed for a robust benchmark.

What is the justification for awarding this contract on a sole-source basis instead of through a competitive process?

The justification for a sole-source award typically falls under specific exceptions to full and open competition outlined in federal acquisition regulations. Common reasons include unique capabilities possessed by only one source, urgent and compelling needs where competition is not feasible, or when the contract is a follow-on to a previous competitive award where only one source can provide necessary compatibility. For aircraft, this could be due to proprietary technology, unique integration requirements with existing platforms, or specific performance characteristics only available from a single manufacturer. The U.S. Coast Guard would need to formally document and justify this sole-source determination.

What are the potential risks associated with acquiring high-value aircraft through a sole-source contract?

The primary risk of a sole-source contract is the potential for inflated pricing due to the absence of competitive pressure. Without competing bids, the government may pay more than necessary. Other risks include limited options for technical solutions or support, and a reduced incentive for the contractor to innovate or offer cost-saving measures. Furthermore, sole-source awards can face greater scrutiny from oversight bodies and potentially lead to protests if the justification is deemed inadequate. Ensuring robust contract management and independent cost analysis becomes even more critical in sole-source situations.

What is Gulfstream Aerospace Corporation's track record with the U.S. Coast Guard and other federal agencies for similar procurements?

Gulfstream Aerospace Corporation is a well-established manufacturer of business jets, many of which have been adapted for government and military use worldwide. The U.S. Coast Guard has previously operated Gulfstream aircraft, such as the C-37A (based on the Gulfstream V), for command and control, VIP transport, and other missions. Gulfstream aircraft are also utilized by various other federal agencies, including NASA and the Department of Defense, for diverse roles. Their track record generally indicates a capability to produce reliable, high-performance aircraft, but specific performance and cost-effectiveness in past government contracts would require detailed review.

What are the implications of the firm-fixed-price (FFP) contract type for cost control and contractor performance?

A Firm-Fixed-Price (FFP) contract is generally preferred by the government when the scope of work is well-defined and risks can be reasonably assessed. Under an FFP contract, the contractor agrees to a total price for a well-defined product or service. This shifts the risk of cost overruns from the government to the contractor. If the contractor's costs exceed the fixed price, they absorb the loss. Conversely, if costs are lower than anticipated, the contractor realizes a higher profit. This structure incentivizes the contractor to manage costs efficiently and perform diligently to meet the contract requirements within the agreed-upon price.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Commercial and Industrial Machinery and Equipment Rental and Leasing › Commercial Air, Rail, and Water Transportation Equipment Rental and Leasing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

Address: 500 GULFSTREAM RD, SAVANNAH, GA, 31408

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: $183,607,054

Exercised Options: $183,607,054

Current Obligation: $183,603,454

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline