DoD's $74M rotary wing airlift support contract awarded to Canadian Commercial Corporation shows fair value

Contract Overview

Contract Amount: $74,101,087 ($74.1M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 2015-08-31

End Date: 2022-03-31

Contract Duration: 2,404 days

Daily Burn Rate: $30.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::OT::IGF -- NORTH WARNING SYSTEMS ROTARY WING AIRLIFT SUPPORT

Plain-Language Summary

Department of Defense obligated $74.1 million to CANADIAN COMMERCIAL CORPORATION for work described as: IGF::OT::IGF -- NORTH WARNING SYSTEMS ROTARY WING AIRLIFT SUPPORT Key points: 1. Contract value of $74.1M over 6.7 years suggests a moderate annual spend. 2. Awarded via full and open competition, indicating a competitive bidding process. 3. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 4. Performance period of over 6 years suggests a long-term need for these services. 5. The primary agency is the Department of Defense, with the Air Force as the supporting agency. 6. The contractor, Canadian Commercial Corporation, is a foreign entity, which may have geopolitical implications.

Value Assessment

Rating: good

The contract's total value of $74.1 million over approximately 6.7 years averages to about $11 million annually. Benchmarking this against similar rotary wing airlift support contracts is challenging without more specific service details and geographic scope. However, the firm fixed-price nature of the contract suggests that the government has secured a predictable cost for the services rendered, which is generally a positive indicator of value. The number of bids received (5) also suggests a reasonable level of competition that likely contributed to a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. Five bids were received, indicating a healthy level of interest and competition for this requirement. The open competition process is designed to foster price discovery and ensure that the government receives the most advantageous offer, both in terms of price and technical merit.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are used efficiently by driving down prices through market forces. A competitive environment typically leads to better deals for the government compared to sole-source or limited competition awards.

Public Impact

Provides essential rotary wing airlift support services, likely for military operations and logistics. Benefits military personnel and potentially civilian agencies requiring specialized air transport. Geographic impact is likely focused on areas where the Department of the Air Force operates or has missions. Supports a specialized aviation workforce, including pilots, mechanics, and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Reliance on a foreign entity for critical airlift support could pose supply chain or geopolitical risks.
The long performance period (over 6 years) might lead to price increases if market conditions change significantly.
Lack of specific details on performance metrics makes it difficult to assess the quality of services delivered.

Positive Signals

Firm Fixed Price contract structure transfers cost overrun risk to the contractor.
Full and open competition suggests a robust process for selecting the best value offer.
Award to a specialized provider like Canadian Commercial Corporation may indicate access to unique capabilities.

Sector Analysis

Rotary wing airlift support falls within the broader aerospace and defense services sector. This sector is characterized by high barriers to entry, specialized technology, and significant government procurement. The market size for such services is substantial, driven by defense spending and the need for flexible, on-demand air transportation capabilities. This contract represents a portion of the Department of Defense's overall investment in aviation support services.

Small Business Impact

There is no indication that this contract included small business set-asides, nor is there information on subcontracting plans. The award to the Canadian Commercial Corporation suggests that the primary focus was on securing the required specialized airlift capabilities, potentially overlooking opportunities for small business participation in the prime contract.

Oversight & Accountability

As a definitive contract awarded by the Department of the Air Force, this procurement is subject to standard federal acquisition regulations and oversight. The Inspector General of the Department of Defense would have jurisdiction over any investigations into fraud, waste, or abuse related to this contract. Transparency is generally maintained through contract databases like FPDS, though specific performance details may be less public.

Related Government Programs

Military Airlift Command
Air Mobility Command
Rotary Wing Aircraft Services
Aviation Support Services
Department of Defense Contracts

Risk Flags

Potential geopolitical risks associated with foreign contractor
Lack of detailed performance metrics
Long contract duration may lead to price volatility

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $74.1 million to CANADIAN COMMERCIAL CORPORATION. IGF::OT::IGF -- NORTH WARNING SYSTEMS ROTARY WING AIRLIFT SUPPORT

Who is the contractor on this award?

The obligated recipient is CANADIAN COMMERCIAL CORPORATION.

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 $74.1 million.

What is the period of performance?

Start: 2015-08-31. End: 2022-03-31.

What is the track record of the Canadian Commercial Corporation in providing rotary wing airlift support to the U.S. Department of Defense?

Information regarding the Canadian Commercial Corporation's (CCC) specific track record with the U.S. Department of Defense (DoD) for rotary wing airlift support is not detailed in the provided data. CCC acts as a facilitator for international contracting, often leveraging Canadian industry capabilities. To assess their track record, one would need to examine past performance evaluations, any reported issues or successes on similar contracts, and their history of meeting delivery schedules and quality standards. Without this granular performance data, it's difficult to definitively gauge their reliability and expertise in this specific service area for the DoD. Further investigation into contract performance reports and any available CPARS (Contractor Performance Assessment Reporting System) data would be necessary.

How does the annual cost of this contract compare to similar rotary wing airlift support services procured by the DoD?

The annual cost for this contract averages approximately $11 million ($74.1M / 6.7 years). Benchmarking this figure against similar rotary wing airlift support services requires detailed comparison data that is not provided. Key factors influencing cost include the type and number of aircraft, crew services, maintenance, operational range, mission complexity, and duration. Contracts for specialized military airlift can vary significantly based on these parameters. To perform a robust comparison, one would need to identify contracts with similar aircraft types (e.g., Black Hawks, Chinooks), service levels (e.g., troop transport, cargo, medevac), and geographic operational areas. Without such comparable data, assessing whether $11 million annually represents a high, low, or fair market price is speculative.

What are the primary risks associated with awarding a significant airlift contract to a foreign entity like the Canadian Commercial Corporation?

Awarding a significant airlift contract to a foreign entity like the Canadian Commercial Corporation (CCC) introduces several potential risks. Geopolitical instability or changes in international relations could disrupt service delivery or necessitate contract termination. There may also be challenges related to differing regulatory environments, security protocols, and communication barriers. Furthermore, reliance on a foreign entity for critical logistical support could impact response times during emergencies or heighten concerns about data security and operational control. While CCC is a government agency, the underlying service providers might be private Canadian firms, introducing further layers of complexity regarding oversight and accountability. Ensuring seamless integration with U.S. military command structures and adherence to stringent U.S. defense standards are paramount.

What is the expected effectiveness of the services provided under this contract in supporting Air Force operations?

The effectiveness of the services provided under this contract hinges on the specific requirements outlined in the statement of work, which are not detailed here. Rotary wing airlift support is crucial for various Air Force operations, including personnel transport, cargo delivery to austere locations, medical evacuation (medevac), search and rescue, and special operations support. If the Canadian Commercial Corporation (CCC) successfully meets the contract's performance standards, it should significantly enhance the Air Force's operational flexibility and reach. The firm fixed-price nature suggests a focus on delivering defined services at a set cost. However, true effectiveness can only be measured against mission success rates, timeliness of support, aircraft availability, and overall contribution to achieving the Air Force's strategic objectives in the areas where these services are deployed.

How has historical spending on rotary wing airlift support by the Department of Defense trended over the past five years?

The provided data focuses solely on this specific $74.1 million contract and does not offer historical spending trends for rotary wing airlift support by the Department of Defense (DoD). To analyze historical spending, one would need access to comprehensive procurement data covering multiple years and various contracts within this service category. Such an analysis would involve examining total obligated amounts, average contract values, number of awards, and key contractors over time. Trends could reveal shifts in demand, changes in pricing, or consolidation within the industry. Without this broader dataset, it is impossible to determine if spending on this particular contract aligns with or deviates from historical patterns.

What are the implications of the 'Nonscheduled Chartered Passenger Air Transportation' classification for the scope and flexibility of this contract?

The classification 'Nonscheduled Chartered Passenger Air Transportation' (NAICS code 481211) indicates that the contract covers on-demand air charter services for passengers, rather than fixed-route scheduled flights. This implies a high degree of flexibility, allowing the Air Force to request airlift services as needed, potentially to various locations not served by regular military transport routes. The 'nonscheduled' aspect means flights are arranged based on specific mission requirements, offering adaptability for tactical or emergent needs. However, it also suggests that the contractor is not obligated to maintain a constant fleet availability or operate on a fixed schedule, which could impact response times depending on the contract's specific terms regarding notice periods and service guarantees.

Industry Classification

NAICS: Transportation and Warehousing › Nonscheduled Air Transportation › Nonscheduled Chartered Passenger Air Transportation

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRAVEL, LODGING, RECRUITMENT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: FA489014R0002

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Government of Canada

Address: 50 O'CONNOR ST SUITE 1100, OTTAWA

Business Categories: Category Business, Foreign Government, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $79,614,307

Exercised Options: $78,153,014

Current Obligation: $74,101,087

Contract Characteristics

Consolidated Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline