Air Force awards $23.7M for YECU/PECU Modification Kits to Honeywell, a sole-source contract
Contract Overview
Contract Amount: $23,667,002 ($23.7M)
Contractor: Honeywell International Inc.
Awarding Agency: Department of Defense
Start Date: 2008-02-01
End Date: 2016-06-30
Contract Duration: 3,072 days
Daily Burn Rate: $7.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MODIFICATION KIT (YECU/PECU)
Place of Performance
Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87113
Plain-Language Summary
Department of Defense obligated $23.7 million to HONEYWELL INTERNATIONAL INC. for work described as: MODIFICATION KIT (YECU/PECU) Key points: 1. Significant contract value for specialized aircraft modification kits. 2. Sole-source award to Honeywell raises questions about competition and potential price inflation. 3. Long contract duration (2008-2016) suggests a critical, long-term need. 4. Lack of small business participation noted.
Value Assessment
Rating: questionable
The contract value of $23.7M over its duration is substantial. Without competitive bids, it's difficult to assess if this price is optimal compared to potential market rates for similar modification kits.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award to Honeywell. This limits price discovery and may lead to higher costs for taxpayers as there was no competitive pressure to lower prices.
Taxpayer Impact: The lack of competition likely resulted in a higher cost to the taxpayer than if multiple vendors had bid on the contract.
Public Impact
Ensures continued operational readiness of Air Force aircraft by providing essential modification kits. Supports a single, established supplier for critical aircraft components, potentially ensuring supply chain stability. Raises concerns about the government's ability to secure the best value for taxpayer dollars due to the sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- No small business participation
Positive Signals
- Essential equipment for Air Force operations
- Long-term contract indicates sustained need
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. Spending in this area is often characterized by high technical requirements and long product lifecycles, sometimes leading to sole-source procurements.
Small Business Impact
The data indicates no small business participation in this contract. This suggests that the prime contractor, Honeywell, likely handled the entire scope of work or subcontracted to other large businesses.
Oversight & Accountability
The sole-source nature of this contract warrants scrutiny from oversight bodies to ensure the price paid was fair and reasonable, and that future procurements explore competitive options where feasible.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for overpayment due to sole-source award.
- Lack of transparency in pricing due to no competition.
- Missed opportunity for small business engagement.
- Long contract duration without clear competitive milestones.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, nm, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $23.7 million to HONEYWELL INTERNATIONAL INC.. MODIFICATION KIT (YECU/PECU)
Who is the contractor on this award?
The obligated recipient is HONEYWELL INTERNATIONAL INC..
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 $23.7 million.
What is the period of performance?
Start: 2008-02-01. End: 2016-06-30.
What was the justification for awarding this contract on a sole-source basis, and were alternatives explored?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs that only one vendor can meet. For this contract, the specific reason for not competing it needs further investigation. Without competitive bids, it's challenging to ascertain if the government secured the best possible price and value.
How does the per-unit cost of these modification kits compare to similar systems or previous contracts?
Benchmarking the per-unit cost is difficult without competitive data. If previous contracts for the same kits existed and were also sole-source, the pricing might be inflated. A thorough review would involve comparing specifications and pricing with similar aftermarket modification kits, if available, from other manufacturers.
What is the long-term strategy for acquiring these modification kits to ensure future cost-effectiveness and competition?
The long-term strategy should focus on fostering competition. This could involve breaking down the requirement into smaller, more manageable components, encouraging new entrants into the market, or developing alternative solutions. The Air Force should actively seek opportunities to transition from sole-source to competitive procurements where possible.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
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: Honeywell International Inc (UEI: 139691877)
Address: 699 ROUTE 46 EAST, ROUTE 46 & INDUS, TETERBORO, NJ, 07608
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $23,667,002
Exercised Options: $23,667,002
Current Obligation: $23,667,002
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2008-02-01
Current End Date: 2016-06-30
Potential End Date: 2016-06-30 00:00:00
Last Modified: 2016-08-02
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