Coast Guard awards $15.1M task order to Rolls-Royce for HC-130 aircraft support

Contract Overview

Contract Amount: $15,104,274 ($15.1M)

Contractor: Rolls-Royce Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2024-09-14

End Date: 2025-09-13

Contract Duration: 364 days

Daily Burn Rate: $41.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TASK ORDER FOR FSR SERVICES FOR HC-130 AIRCRAFT.

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46225

State: Indiana Government Spending

Plain-Language Summary

Department of Homeland Security obligated $15.1 million to ROLLS-ROYCE CORPORATION for work described as: TASK ORDER FOR FSR SERVICES FOR HC-130 AIRCRAFT. Key points: 1. Contract focuses on essential support services for HC-130 aircraft, crucial for Coast Guard operations. 2. Awarded under full and open competition, suggesting a competitive bidding process. 3. The contract duration of 364 days indicates a need for ongoing, sustained support. 4. Rolls-Royce, a major aerospace manufacturer, is the incumbent contractor. 5. The contract type is Firm Fixed Price, providing cost certainty for the government. 6. This award represents a significant investment in maintaining the operational readiness of a key Coast Guard asset.

Value Assessment

Rating: good

The contract value of $15.1 million for a one-year period for specialized aircraft support appears reasonable given the nature of the services. Benchmarking against similar support contracts for complex military aircraft would provide a more precise value-for-money assessment. However, Rolls-Royce's established role as a manufacturer of these engines suggests potential efficiencies and expertise that could justify the pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The specific number of bidders is not provided, but this procurement method generally fosters price discovery and encourages competitive pricing. The government likely sought the best value proposition from a range of potential suppliers.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining services at competitive prices, preventing potential overcharges and ensuring efficient use of public funds.

Public Impact

The U.S. Coast Guard benefits from enhanced operational readiness and continued support for its HC-130 aircraft fleet. Services delivered include essential maintenance and support activities critical for aircraft airworthiness. The geographic impact is likely national, supporting Coast Guard missions across various regions. Workforce implications include the potential for skilled technicians and engineers to be engaged in supporting these vital aircraft.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for sole-source reliance on Rolls-Royce for future specialized parts or services if competition is not maintained.
Dependence on a single contractor for critical aircraft support could pose risks if the contractor faces financial or operational challenges.

Positive Signals

Award to a well-established aerospace manufacturer with a proven track record in engine support.
Firm Fixed Price contract provides budget predictability and limits the government's exposure to cost overruns.
Full and open competition suggests a robust market for these services, promoting competitive pricing.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aviation support services. The market for specialized aircraft maintenance and support is often dominated by original equipment manufacturers (OEMs) like Rolls-Royce due to proprietary knowledge and technical requirements. Spending in this area is critical for maintaining the operational capabilities of military and governmental aviation fleets, ensuring national security and public safety missions can be effectively executed.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the specialized nature of aircraft engine support, it is likely that the primary awardee is a large business. Subcontracting opportunities for small businesses may exist, but these would depend on the prime contractor's procurement strategy and the specific needs of the task order.

Oversight & Accountability

Oversight for this contract will be managed by the U.S. Coast Guard contracting and program management offices. Accountability measures are inherent in the Firm Fixed Price contract type, which obligates the contractor to deliver specified services within the agreed-upon price. Transparency is generally maintained through contract award databases, though specific performance metrics and oversight reports may not always be publicly available.

Related Government Programs

Aircraft Maintenance and Repair
Aviation Support Services
Defense Logistics Agency (DLA) Aviation
Propulsion Systems Support Contracts

Risk Flags

Potential for sole-source dependency on OEM for future support.
Risk of performance issues impacting operational readiness.
Complexity of specialized aerospace support may limit competitive landscape.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $15.1 million to ROLLS-ROYCE CORPORATION. TASK ORDER FOR FSR SERVICES FOR HC-130 AIRCRAFT.

Who is the contractor on this award?

The obligated recipient is ROLLS-ROYCE 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 $15.1 million.

What is the period of performance?

Start: 2024-09-14. End: 2025-09-13.

What is Rolls-Royce Corporation's historical performance record with the U.S. Coast Guard and other federal agencies for similar aviation support services?

Rolls-Royce Corporation has a long-standing relationship with various branches of the U.S. military and federal agencies, including the Coast Guard, providing engine support and maintenance for numerous aircraft platforms. Their performance record generally reflects a high degree of technical expertise and reliability, essential for aviation operations. Historical data from contract databases often shows a pattern of successful contract completions, though specific performance ratings (e.g., CPARS) would provide a more granular view. For instance, their involvement in supporting engines for aircraft like the C-130 variants across different services indicates a consistent capability. However, like any large contractor, there can be instances of performance issues or disputes, which would be detailed in specific contract performance reviews. A comprehensive assessment would involve analyzing past contract awards, performance evaluations, and any documented issues to understand their track record in delivering complex aviation support.

How does the awarded amount of $15.1 million for 364 days of HC-130 support compare to previous contracts for similar services?

Comparing the awarded amount of $15.1 million for 364 days of HC-130 support requires access to historical contract data for similar services provided to the Coast Guard or other agencies. Without direct comparative data, it's challenging to definitively benchmark the value. However, the daily rate implied is approximately $41,495 ($15.1M / 364 days). This figure needs to be contextualized by the specific services included (e.g., routine maintenance, unscheduled repairs, parts, technical support). Rolls-Royce's role as the original equipment manufacturer (OEM) often means their pricing reflects specialized knowledge and access to proprietary parts. If previous contracts for similar comprehensive support were in a comparable range, it suggests the current pricing is in line with market expectations for this specialized service. Conversely, if previous rates were significantly lower, it might warrant further investigation into the scope of work or market dynamics.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Primary risks associated with this contract include potential cost overruns if the Firm Fixed Price (FFP) structure doesn't adequately account for unforeseen maintenance needs or parts price increases, although FFP generally shifts this risk to the contractor. Another risk is contractor performance degradation or failure to meet critical deadlines, impacting Coast Guard operational readiness. Dependence on a single OEM for specialized support also poses a long-term risk if alternative support options are not developed. Mitigation strategies typically include robust contract oversight by the Coast Guard, clear performance metrics and deliverables, and contingency planning for critical part sourcing. The FFP structure itself is a mitigation against government cost overruns. For performance risks, the government can leverage contract clauses for remedies, including termination for default if necessary. Maintaining a strong relationship and open communication with Rolls-Royce can also help proactively address potential issues.

How effective is the 'full and open competition' process in ensuring the best value for taxpayers in specialized aerospace support contracts?

The 'full and open competition' process is generally considered the most effective method for ensuring best value for taxpayers, especially in specialized aerospace support. It allows multiple qualified vendors to bid, fostering a competitive environment that drives down prices and encourages innovation. For complex services like HC-130 support, this means the government can solicit proposals detailing technical approaches, past performance, and pricing, then select the offer that provides the optimal balance of cost and capability. While OEMs like Rolls-Royce often have an advantage due to proprietary knowledge, competition ensures that even they must price competitively against other potential providers or specialized MRO (Maintenance, Repair, and Overhaul) facilities. The effectiveness hinges on the government clearly defining requirements and evaluation criteria to ensure the 'best value' is truly achieved, not just the lowest price.

What is the historical spending trend for HC-130 aircraft support by the U.S. Coast Guard, and how does this award fit into that pattern?

Analyzing historical spending trends for HC-130 aircraft support by the U.S. Coast Guard requires examining contract awards over several fiscal years. The HC-130 is a long-serving platform, and its support costs would likely show consistent annual spending for maintenance, parts, and engine services. This $15.1 million award for a one-year task order represents a significant but likely typical annual investment for maintaining a fleet of these aircraft. Historical data might reveal fluctuations based on fleet readiness needs, major overhauls, or changes in contract vehicles. If the Coast Guard has been consistently awarding contracts in the $10-20 million range annually for HC-130 support, this award fits within that established pattern. Understanding these trends helps in budget forecasting and assessing whether current spending is anomalous or consistent with long-term operational requirements.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rolls-Royce Holdings PLC

Address: 450 S MERIDIAN ST, INDIANAPOLIS, IN, 46225

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $15,104,274

Exercised Options: $15,104,274

Current Obligation: $15,104,274

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $4,446,021

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HSCG3817DH00006

IDV Type: IDC

Timeline