DoD awards $116M to Boeing for aircraft parts, with 4 bidders in a full and open competition

Contract Overview

Contract Amount: $116,235,855 ($116.2M)

Contractor: Boeing Aerospace Operations, Inc.

Awarding Agency: Department of Defense

Start Date: 1999-11-19

End Date: 2010-09-21

Contract Duration: 3,959 days

Daily Burn Rate: $29.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Place of Performance

Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73135

State: Oklahoma Government Spending

Plain-Language Summary

Department of Defense obligated $116.2 million to BOEING AEROSPACE OPERATIONS, INC. for work described as: Key points: 1. Contract awarded for aircraft parts manufacturing, indicating a need for specialized components. 2. The competition involved 4 bidders, suggesting a moderately competitive market for these services. 3. The contract duration of nearly 11 years (3959 days) points to a long-term requirement. 4. Fixed-price contract type suggests cost certainty for the government, shifting risk to the contractor. 5. The award was made by the Defense Contract Management Agency, a key oversight body. 6. The contract value of $116.2 million over its term warrants scrutiny for value for money.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the aircraft parts and their complexity. However, a contract of this magnitude awarded over a decade ago suggests a significant procurement. The fixed-price nature provides some cost control, but the long duration could lead to price escalations if not managed carefully. Further analysis would require comparing unit costs for similar parts or services procured by the DoD during that period.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with four bidders participating. This level of competition is generally positive, as it allows for a broader range of potential suppliers to bid, which can drive down prices and encourage innovation. The presence of four bidders suggests that the market for these specific aircraft parts is not overly concentrated, allowing for a reasonable degree of price discovery.

Taxpayer Impact: A full and open competition with multiple bidders is beneficial for taxpayers as it increases the likelihood of securing the best possible price and quality for the required aircraft parts, preventing potential overpayment.

Public Impact

The primary beneficiaries are the U.S. military branches relying on the specified aircraft parts for operational readiness. The contract ensures the supply of essential components for aircraft maintenance and operation. The geographic impact is primarily centered around the contractor's facilities and the military bases where the aircraft are deployed. Workforce implications include employment opportunities at Boeing and its subcontractors involved in manufacturing these parts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (nearly 11 years) could lead to potential cost overruns if market conditions change significantly.
Lack of specific details on the 'Other Aircraft Parts' makes it difficult to assess the true value and necessity.
Fixed-price contracts can sometimes lead to lower quality if contractors cut corners to maintain profit margins over a long period.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process.
Multiple bidders (4) suggest a healthy competitive environment for these parts.
The contract is managed by the Defense Contract Management Agency, implying oversight.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. The market for such components is characterized by high technical requirements, stringent quality control, and often long production cycles. Boeing is a major player in this industry. Comparable spending benchmarks would involve analyzing other DoD contracts for similar aircraft component manufacturing, considering factors like part complexity, material, and quantity.

Small Business Impact

The data indicates that small business participation was not a primary focus for this specific contract, as the 'sb' field is false. There is no explicit mention of small business set-asides or subcontracting plans. This suggests that the prime contractor, Boeing, likely handled the majority of the work internally or with larger partners, potentially limiting opportunities for small businesses in this particular procurement.

Oversight & Accountability

The Defense Contract Management Agency (DCMA) is responsible for overseeing this contract, ensuring compliance with terms and conditions. As a fixed-price contract, oversight would focus on delivery schedules, quality assurance, and adherence to specifications. Transparency is generally maintained through contract award databases, but detailed performance metrics and cost breakdowns may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aircraft Manufacturing
Defense Procurement
Aerospace Components
Military Aircraft Support
Fixed-Price Contracts

Risk Flags

Long contract duration may increase risk of cost escalation or obsolescence.
Lack of specific part details hinders comprehensive value assessment.
Fixed-price nature shifts risk to contractor, potentially impacting quality if not managed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $116.2 million to BOEING AEROSPACE OPERATIONS, INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is BOEING AEROSPACE OPERATIONS, 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 $116.2 million.

What is the period of performance?

Start: 1999-11-19. End: 2010-09-21.

What is the specific nature of the 'Other Aircraft Parts and Auxiliary Equipment' manufactured under this contract, and how critical are they to military operations?

The National Stock Number (NSN) 336413 typically refers to 'Aircraft Parts and Auxiliary Equipment, Non-powered.' Without more specific product details, it's challenging to pinpoint the exact components. However, 'auxiliary equipment' can encompass a wide range of items such as landing gear components, hydraulic systems parts, electrical system parts, or structural elements. Given the contractor (Boeing) and the awarding agency (DoD), these parts are likely critical for the maintenance, repair, and operational readiness of various military aircraft platforms. Their criticality would depend on whether they are spare parts for routine maintenance or specialized components for specific aircraft systems essential for mission success.

How does the $116.2 million contract value compare to similar procurements for aircraft parts by the DoD during the late 1990s and early 2000s?

Comparing the $116.2 million contract value requires context regarding the specific types of parts procured and the quantities. Awarded in 1999 for a duration extending to 2010, this represents an average annual spend of approximately $10.5 million. During that era, the DoD was engaged in significant modernization and sustainment efforts for its aircraft fleets. Large-scale contracts for complex components or a high volume of standardized parts could easily reach this value. To provide a precise comparison, one would need to identify contracts for similar NSGs or part categories, factoring in inflation and the scale of the specific aircraft programs supported.

What were the key performance indicators (KPIs) and quality assurance measures stipulated in this fixed-price contract to ensure the reliability of the aircraft parts?

While the specific KPIs and quality assurance measures are not detailed in the provided summary, fixed-price contracts for defense articles typically include stringent requirements. These often involve adherence to detailed technical specifications and drawings, compliance with military standards (e.g., MIL-SPEC), and rigorous testing protocols. Quality assurance would likely involve source inspection by the DCMA, material certifications, and traceability of components. KPIs would focus on on-time delivery, defect rates (e.g., parts per million defective), and successful completion of acceptance testing. Failure to meet these could result in contract penalties or termination.

Given the nearly 11-year duration, what mechanisms were in place to manage potential price fluctuations or obsolescence of parts?

For a contract spanning nearly 11 years, mechanisms to manage price fluctuations and obsolescence are crucial. In a firm fixed-price contract, the primary responsibility for managing these risks typically lies with the contractor. However, contract clauses might allow for price adjustments under specific, predefined circumstances, such as significant, unforeseen escalation in raw material costs, though this is less common in firm fixed-price agreements. To address obsolescence, the contract might specify requirements for long-term material availability planning, alternative sourcing strategies, or provisions for redesigning components if original parts become unavailable. The government would likely monitor these aspects through regular contractor reporting and performance reviews.

What is Boeing's track record with the DoD for similar aircraft parts manufacturing contracts, particularly concerning delivery performance and quality?

Boeing has a long and extensive history as a prime contractor for the Department of Defense, including numerous contracts for aircraft manufacturing and component supply. Their track record for similar parts manufacturing is generally robust, given their position as a major aerospace manufacturer. However, like any large contractor, they have experienced periods of both exceptional performance and challenges. Historically, issues related to production delays, cost overruns (more common in cost-plus contracts), and quality control have occasionally arisen on large, complex defense programs. For this specific contract, the 'OK' status for 'st' (status) and 'sn' (state) suggests no major outstanding issues were flagged at the time of data extraction, but a deeper dive into historical performance data would be needed for a comprehensive assessment.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: EDUCATION AND TRAINING › EDUCATION AND TRAINING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 100 BOEING WAY, TITUSVILLE, FL, 08

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline