Vertex Aerospace awarded $116.9M for KC-10 airframe sustainment, with a 1008-day performance period

Contract Overview

Contract Amount: $116,929,143 ($116.9M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2022-01-01

End Date: 2024-10-05

Contract Duration: 1,008 days

Daily Burn Rate: $116.0K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: KC-10 AIRFRAME

Place of Performance

Location: MADISON, MADISON County, MISSISSIPPI, 39110

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $116.9 million to VERTEX AEROSPACE LLC for work described as: KC-10 AIRFRAME Key points: 1. Contract value represents a significant investment in maintaining critical aerial refueling capabilities. 2. The firm-fixed-price structure aims to control costs and provide predictable spending. 3. Performance period of over two years suggests a focus on sustained operational support. 4. The contract is managed by the Defense Contract Management Agency, indicating robust oversight. 5. This award falls under 'Other Support Activities for Air Transportation', a key defense logistics category.

Value Assessment

Rating: good

The contract value of $116.9 million for KC-10 airframe sustainment appears reasonable given the scope of maintaining complex military aircraft. Benchmarking against similar sustainment contracts for large airframes would provide a more precise value-for-money assessment. The firm-fixed-price (FFP) type suggests that the contractor bears the risk of cost overruns, which is generally favorable for the government. However, without detailed cost breakdowns or comparisons to industry standards for specific maintenance tasks, a definitive value assessment is challenging.

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 vendors had the opportunity to bid. The specific number of bidders is not provided, but the 'full and open' designation suggests a competitive environment. This approach is intended to foster price discovery and ensure the government receives the best possible value by leveraging market forces.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through a wider pool of potential offerors, leading to more cost-effective procurement outcomes.

Public Impact

The primary beneficiaries are the U.S. Air Force units operating the KC-10 Extender aircraft, ensuring their continued operational readiness. Services delivered include sustainment and maintenance of the KC-10 airframe, crucial for its long-term functionality. The geographic impact is national, supporting air mobility command operations across various bases. Workforce implications include skilled aviation mechanics, technicians, and support staff employed by Vertex Aerospace and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep if contract scope expands beyond initial airframe sustainment.
Dependence on a single contractor for critical airframe maintenance could pose supply chain risks.
Ensuring adequate performance metrics are met to justify the contract value.

Positive Signals

Firm-fixed-price contract structure incentivizes cost control by the contractor.
Awarded through full and open competition, suggesting competitive pricing.
Long performance period indicates a commitment to sustained support, potentially leading to economies of scale.

Sector Analysis

The aerospace and defense sector is characterized by high technological complexity, stringent regulatory requirements, and significant government investment. Contracts for aircraft sustainment are a substantial part of this sector, ensuring the operational readiness of military fleets. The market for such services is competitive, with specialized firms like Vertex Aerospace vying for lucrative government contracts. Spending on aircraft maintenance and sustainment is a critical component of the overall defense budget, often representing a significant portion of the total lifecycle cost of military platforms.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, Vertex Aerospace is likely a large business. While there is no direct small business set-aside, the contract may still have implications for small businesses through subcontracting opportunities. The extent to which Vertex Aerospace engages small businesses as subcontractors will determine the direct impact on the small business ecosystem. Further analysis of subcontracting plans would be necessary to fully assess this impact.

Oversight & Accountability

The contract is managed by the Defense Contract Management Agency (DCMA), which provides contract administration services to the Department of Defense. DCMA's role includes ensuring contractor compliance with contract terms, monitoring performance, and verifying payments. The firm-fixed-price nature of the contract provides a degree of cost control. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics and oversight reports may not always be publicly accessible.

Related Government Programs

KC-135 Stratotanker Sustainment Programs
C-17 Globemaster III Sustainment
Air Force Materiel Command Sustainment Contracts
Defense Logistics Agency Aviation Support

Risk Flags

Potential for scope creep in sustainment contracts.
Reliance on contractor for critical maintenance services.
Ensuring long-term cost-effectiveness of firm-fixed-price agreements for complex assets.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $116.9 million to VERTEX AEROSPACE LLC. KC-10 AIRFRAME

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $116.9 million.

What is the period of performance?

Start: 2022-01-01. End: 2024-10-05.

What is Vertex Aerospace's track record with similar large-scale aircraft sustainment contracts?

Vertex Aerospace LLC has a history of performing aircraft maintenance, repair, and overhaul (MRO) services for various government and commercial clients. While specific details on their track record with KC-10 sustainment are not provided in this data snippet, their ability to secure a $116.9 million contract suggests they possess the necessary certifications, infrastructure, and experience. A deeper dive into their contract history, including past performance evaluations and any significant issues encountered on previous large sustainment programs, would offer a more comprehensive understanding of their capabilities and reliability in managing complex, long-term agreements.

How does the awarded amount compare to historical spending on KC-10 airframe sustainment?

To accurately compare the awarded amount of $116.9 million to historical spending on KC-10 airframe sustainment, one would need access to historical contract data for this specific aircraft type. This would involve analyzing previous awards for maintenance, repair, and overhaul services for the KC-10 fleet over several fiscal years. Factors such as inflation, changes in operational tempo, and evolving maintenance requirements can influence year-over-year spending. Without this historical context, it is difficult to ascertain whether this award represents an increase, decrease, or stable level of investment in KC-10 sustainment.

What are the primary risks associated with this firm-fixed-price contract for airframe sustainment?

While firm-fixed-price (FFP) contracts are generally favored for cost control, risks can still arise. For airframe sustainment, a primary risk is the potential for unforeseen technical issues or the need for extensive repairs not fully anticipated during the bidding process. If the scope of work significantly expands beyond what was defined, the contractor might face substantial cost overruns, potentially leading to requests for contract modifications or disputes. Another risk is the contractor's ability to maintain the required quality standards throughout the contract duration; a focus on cost reduction could inadvertently impact the thoroughness of maintenance. Ensuring robust oversight and clear contract definitions are crucial to mitigate these risks.

How effective is the Defense Contract Management Agency (DCMA) in overseeing this type of sustainment contract?

The Defense Contract Management Agency (DCMA) is the primary organization responsible for administering defense contracts, including sustainment programs like this one for the KC-10 airframe. DCMA's effectiveness relies on its personnel's expertise in contract surveillance, quality assurance, and financial oversight. For a firm-fixed-price contract, DCMA would focus on ensuring the contractor meets performance specifications, delivery schedules, and quality standards. Their oversight helps ensure that taxpayer money is spent appropriately and that the contracted services are delivered as intended. The agency's effectiveness can be gauged by the contractor's performance history and the absence of major contract disputes or failures.

What is the expected impact of this contract on the operational readiness of the KC-10 fleet?

This contract is directly aimed at ensuring the operational readiness of the KC-10 fleet by providing essential airframe sustainment. The KC-10 Extender is a critical asset for aerial refueling and strategic airlift. By securing a multi-year contract with Vertex Aerospace, the Department of Defense signals a commitment to maintaining the airworthiness and functionality of these aircraft. The successful execution of this contract should lead to fewer aircraft being grounded due to maintenance issues, thereby increasing the availability of KC-10s for training missions, deployments, and operational support, ultimately bolstering the Air Force's global reach and power projection capabilities.

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

Address: 555 INDUSTRIAL DR S, MADISON, MS, 39110

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $116,929,143

Exercised Options: $116,929,143

Current Obligation: $116,929,143

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA810516D0003

IDV Type: IDC

Timeline