Boeing awarded $16.16M firm-fixed-price contract for aircraft structural components, awarded on a sole-source basis

Contract Overview

Contract Amount: $16,161,469 ($16.2M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2005-03-07

End Date: 2010-03-01

Contract Duration: 1,820 days

Daily Burn Rate: $8.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200506!000196!5700!FA8105!OC-ALC/LAD 135 !FA810505C0005 !A!N! !N! ! !20050307!20090831!007237241!007237241!009256819!N!THE BOEING COMPANY !4615 SOUTH OLIVER !WICHITA !KS!67210!79000!173!20!WICHITA !SEDGWICK !KANSAS !+000002631401!N!N!000000000000!1560!AIRFRAME STRUCTURAL COMPONENTS !A1A!AIRFRAMES AND SPARES !000 !* !336411!E! !3! ! ! ! ! !20200930!B! ! !A! !D!N!J!1!001!N!1A!Z!N!A! ! !Y!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: WICHITA, SEDGWICK County, KANSAS, 67210

State: Kansas Government Spending

Plain-Language Summary

Department of Defense obligated $16.2 million to THE BOEING COMPANY for work described as: 200506!000196!5700!FA8105!OC-ALC/LAD 135 !FA810505C0005 !A!N! !N! ! !20050307!20090831!007237241!007237241!009256819!N!THE BOEING COMPANY !4615 SOUTH OLIVER !WICHITA !KS!67210!79000!173!20!WICHITA !SEDG… Key points: 1. Contract awarded on a sole-source basis, raising questions about price competition and potential value for taxpayers. 2. The contract value of $16.16M for aircraft structural components suggests a significant investment in airframe maintenance or production. 3. A duration of 1820 days (5 years) indicates a long-term need for these specific components. 4. The 'NOT COMPETED' status warrants further investigation into the justification for avoiding a competitive bidding process. 5. The contract falls under the 'Aircraft Manufacturing' industry, a sector often dominated by a few large players. 6. The 'DCA' award type may indicate a specific contracting action or modification, requiring deeper analysis.

Value Assessment

Rating: questionable

The contract's value of $16.16M for aircraft structural components, awarded on a sole-source basis, makes direct value-for-money assessment challenging without competitive benchmarks. The firm-fixed-price structure provides cost certainty for the government, but the lack of competition means the government may not have secured the lowest possible price. Further analysis would be needed to compare this pricing to similar sole-source procurements or historical data for these specific components to determine if the price is reasonable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. The 'NOT COMPETED' status indicates that only one source, The Boeing Company, was solicited or considered for this procurement. This approach bypasses the typical competitive bidding process, which can limit price discovery and potentially lead to higher costs for the government compared to an open competition.

Taxpayer Impact: Sole-source awards mean taxpayers may not be benefiting from the most competitive pricing achievable through a bidding process. This can result in a less efficient use of public funds.

Public Impact

The primary beneficiary of this contract is The Boeing Company, which will receive $16.16M for providing aircraft structural components. The services delivered are the manufacturing or supply of critical airframe structural components, essential for maintaining or producing aircraft. The geographic impact is primarily centered around Wichita, Kansas, where Boeing's facility is located, potentially supporting local jobs and the regional economy. Workforce implications include the potential for sustained employment for engineers, manufacturing personnel, and support staff at Boeing's Wichita facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices for taxpayers.
Sole-source awards can reduce transparency in government spending.
Dependence on a single contractor for critical components can pose supply chain risks.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Long contract duration suggests a stable, long-term need for the components.
Award to a major defense contractor like Boeing indicates access to established expertise and production capabilities.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aircraft manufacturing and components. The market for major airframe structural components is highly concentrated, with a few large, established companies like Boeing dominating. Spending in this area is critical for maintaining military readiness and supporting the operational fleet. Comparable spending benchmarks would typically involve analyzing other contracts for similar components, whether sole-source or competed, to assess pricing reasonableness.

Small Business Impact

This contract does not appear to have a small business set-aside component, as it was awarded directly to The Boeing Company. There is no explicit information provided regarding subcontracting plans for small businesses. The lack of a set-aside suggests that opportunities for small businesses may be limited unless Boeing voluntarily includes them in its supply chain.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense and the Department of the Air Force. As a sole-source award, scrutiny may be higher to ensure the justification for non-competition is valid and that the pricing is fair and reasonable. Transparency is limited due to the lack of a competitive process, and accountability would rely on contract performance monitoring and potential audits by the Defense Contract Audit Agency (DCAA) or the Inspector General.

Related Government Programs

Aircraft Manufacturing
Airframe Components
Defense Procurement
Sole-Source Contracts
Air Force Logistics Command

Risk Flags

Sole-source award justification requires review.
Potential for non-competitive pricing.
Long-term contract duration may lock in potentially suboptimal pricing.
Lack of transparency in procurement process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.2 million to THE BOEING COMPANY. 200506!000196!5700!FA8105!OC-ALC/LAD 135 !FA810505C0005 !A!N! !N! ! !20050307!20090831!007237241!007237241!009256819!N!THE BOEING COMPANY !4615 SOUTH OLIVER !WICHITA !KS!67210!79000!173!20!WICHITA !SEDGWICK !KANSAS !+000002631401!N!N!000000000000!1560!AIRFRAME STRUCTURAL COMPONENTS !A1A!AIRFRAMES AND SPARES !000 !* !336411!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is THE BOEING COMPANY.

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 $16.2 million.

What is the period of performance?

Start: 2005-03-07. End: 2010-03-01.

What is the specific justification provided by the Department of the Air Force for awarding this contract on a sole-source basis to The Boeing Company?

The provided data indicates the contract was 'NOT COMPETED' and awarded under the 'A' (Award) action obligation type. While the specific justification is not detailed in the provided snippet, common reasons for sole-source awards include: a) only one responsible source exists capable of fulfilling the requirement (e.g., proprietary technology, unique capabilities), b) an urgent and compelling need exists that cannot be met through competition, or c) for follow-on work where it's deemed not to be in the government's best interest to compete. A thorough review of the contract file and associated documentation would be necessary to ascertain the precise justification used by the Air Force for this particular procurement.

How does the per-unit cost of these aircraft structural components compare to similar components procured competitively or by other agencies?

The provided data does not include per-unit cost information or detailed specifications for the 'AIRFRAME STRUCTURAL COMPONENTS' (NAICS 336411). Therefore, a direct comparison to similar components procured competitively or by other agencies is not possible with the given information. To perform such a comparison, one would need to identify the specific part numbers or types of structural components, their quantities, and the pricing terms of comparable contracts. Benchmarking would involve accessing databases of federal procurement data or industry cost models to establish a reasonable price range for these items.

What is The Boeing Company's track record with the Department of Defense for similar aircraft structural component contracts?

The Boeing Company is a major defense contractor with a long history of supplying aircraft and components to the Department of Defense. While this specific contract is for $16.16M over five years, Boeing likely has numerous other contracts, both competed and sole-source, for a wide range of aircraft parts, systems, and platforms. Analyzing Boeing's past performance on similar contracts, including delivery timeliness, quality, and cost control, would provide insight into their reliability. However, without access to detailed performance reviews or a broader contract history for this specific component category, a comprehensive assessment of their track record for this particular item is limited to their general reputation as a large aerospace manufacturer.

What are the potential risks associated with relying on a sole-source provider like Boeing for critical aircraft structural components?

Relying on a sole-source provider for critical aircraft structural components introduces several risks. Firstly, there's a risk of paying a premium price due to the lack of competitive pressure, potentially leading to inefficient use of taxpayer funds. Secondly, it can create a dependency on a single supplier, making the government vulnerable to supply chain disruptions, production issues, or changes in the contractor's business strategy. Thirdly, without competition, there might be less incentive for the contractor to innovate or improve efficiency. Finally, the lack of transparency inherent in sole-source awards can make it harder to identify and mitigate potential risks related to quality control or cost overruns.

How has historical spending by the Department of the Air Force on aircraft structural components trended over the past five years?

The provided data snippet pertains to a single contract awarded in 2005. To analyze historical spending trends for aircraft structural components by the Department of the Air Force over the past five years, a broader dataset encompassing multiple contracts would be required. This analysis would involve querying federal procurement databases (like FPDS or USASpending) for contracts with relevant Product Service Codes (PSCs) or North American Industry Classification System (NAICS) codes related to aircraft manufacturing and components, filtering by the Department of the Air Force and the specified time frame. Trends could reveal increases or decreases in spending, shifts towards specific types of components, or changes in contracting strategies (e.g., more sole-source vs. competed awards).

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft 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

Address: 4615 SOUTH OLIVER, WICHITA, KS, 04

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline