Vertex Aerospace LLC awarded $560M for COMBS Support, with 3 bids received

Contract Overview

Contract Amount: $560,040,622 ($560.0M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2017-12-08

End Date: 2025-05-31

Contract Duration: 2,731 days

Daily Burn Rate: $205.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: T-1A CONTRACTOR OPERATED AND MAINTAINED BASE SUPPLY (COMBS) SUPPORT

Place of Performance

Location: MADISON, MADISON County, MISSISSIPPI, 39110

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $560.0 million to VERTEX AEROSPACE LLC for work described as: T-1A CONTRACTOR OPERATED AND MAINTAINED BASE SUPPLY (COMBS) SUPPORT Key points: 1. Contract value of $560M over its period of performance suggests significant operational scale. 2. The use of a Firm Fixed Price contract type indicates a defined scope and risk allocation. 3. A definitive contract award implies a structured procurement process. 4. The contract's duration of over 2700 days points to long-term operational requirements. 5. The 'Other Support Activities for Air Transportation' NAICS code places this within a critical logistics and maintenance sector. 6. The absence of small business set-aside flags suggests the primary contractor is not a small business, and subcontracting opportunities may vary.

Value Assessment

Rating: good

The total contract value of $560M for COMBS support is substantial, reflecting the extensive nature of base supply operations. Benchmarking this against similar large-scale logistics and maintenance contracts within the Department of Defense would provide a clearer picture of value for money. The firm fixed price structure suggests that cost overruns are primarily the contractor's responsibility, which can be a positive indicator for cost control if the scope is well-defined. However, without detailed breakdowns of services and performance metrics, a precise value-for-money assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. With three bids received, this suggests a moderate level of competition for this significant contract. While three bidders is better than a sole-source or limited competition scenario, a higher number of bids could potentially drive prices down further and foster more innovation. The competition level here likely provided a reasonable basis for price discovery.

Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers, as it increases the likelihood of receiving competitive pricing and ensures that the government is not locked into a single provider without exploring market alternatives.

Public Impact

The Department of the Air Force benefits from the continuity of essential base supply operations. This contract ensures the maintenance and operation of critical supply chains at air bases. The services delivered are vital for the readiness and operational capability of air transportation units. The contract is geographically focused on Mississippi, supporting local infrastructure and potentially local employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep if contract scope is not tightly managed despite fixed-price nature.
Dependence on a single contractor for critical base supply functions could pose a risk if performance falters.
The long contract duration might lead to vendor lock-in if not managed proactively.
Limited visibility into specific performance metrics without further data.

Positive Signals

Firm fixed price contract structure generally promotes cost control.
Full and open competition suggests a robust procurement process and potential for competitive pricing.
Award to Vertex Aerospace LLC, a known entity in aerospace support, may indicate established capability.
The contract supports essential Air Force operations, contributing to national security objectives.

Sector Analysis

This contract falls within the broader aerospace and defense services sector, specifically focusing on logistics and base support. The market for such services is substantial, driven by the ongoing needs of military branches for efficient and reliable operational support. Comparable spending benchmarks would involve analyzing other large-scale base operations and maintenance contracts awarded by the DoD, looking at cost per operational hour or cost per unit supported to gauge efficiency.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). This suggests that the primary focus was on securing the best overall offer from the market, which may or may not involve significant subcontracting to small businesses. Further analysis of the contract's subcontracting plan would be necessary to understand its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Air Force. Accountability measures are embedded in the firm fixed price contract terms, requiring Vertex Aerospace LLC to deliver specified services within the agreed-upon price. Transparency is generally facilitated through contract award databases, though detailed performance reports may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Base Operations Support (BOS)
Logistics and Supply Chain Management Services
Aerospace Maintenance and Repair Contracts
Defense Logistics Agency (DLA) Contracts
Air Mobility Command (AMC) Support Contracts

Risk Flags

Long contract duration may increase risk of vendor lock-in.
Potential for scope creep if not managed tightly.
Dependence on contractor performance for critical supply chain functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $560.0 million to VERTEX AEROSPACE LLC. T-1A CONTRACTOR OPERATED AND MAINTAINED BASE SUPPLY (COMBS) SUPPORT

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

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 $560.0 million.

What is the period of performance?

Start: 2017-12-08. End: 2025-05-31.

What is Vertex Aerospace LLC's track record with similar large-scale DoD contracts?

Vertex Aerospace LLC has a history of performing various support services for the Department of Defense, including aircraft maintenance, logistics, and base operations. Their experience often involves complex supply chain management and operational support, similar to the COMBS contract. Analyzing their past performance on contracts of comparable size and scope, particularly regarding on-time delivery, quality of service, and adherence to budget, would provide insight into their reliability. Past performance reviews and any documented issues or commendations from previous DoD contracts are crucial for assessing their capability to successfully execute this $560M COMBS support agreement over its extended duration.

How does the awarded price compare to industry benchmarks for similar base supply support services?

Determining precise industry benchmarks for a contract of this scale and specificity (COMBS Support) is challenging without access to proprietary cost data or detailed service level agreements. However, the total contract value of $560 million over approximately 7 years (from late 2017 to mid-2025) suggests an average annual value of roughly $80 million. This figure needs to be contextualized by the specific services provided, the number of bases supported, and the complexity of the supply chain managed. Comparisons could be made to other large indefinite-delivery/indefinite-quantity (IDIQ) or definitive contracts for base operations support, logistics, and maintenance within the DoD. Factors like the cost per square foot of storage, cost per item managed, or cost per maintenance action would be relevant metrics if available.

What are the primary risks associated with a firm fixed price contract of this magnitude and duration?

The primary risks associated with a firm fixed price (FFP) contract of this magnitude ($560M) and duration (over 2700 days) revolve around scope definition and potential for unforeseen cost increases impacting the contractor's profitability, which could indirectly affect performance. If the initial scope of work is not meticulously defined and understood by both parties, the contractor may face unexpected costs to fulfill their obligations, potentially leading to performance issues or requests for contract modifications. For the government, the risk lies in ensuring the FFP adequately covers all necessary services and that the contractor has the financial stability and operational capacity to sustain performance over the long term. Changes in operational tempo or unforeseen global events could also strain the contractor's ability to maintain the fixed price.

How effective has the 'full and open competition' process been in ensuring competitive pricing for this contract?

The 'full and open competition' award for this $560M COMBS support contract, resulting in three bids, suggests a moderately competitive environment. While this approach is designed to maximize competition and achieve fair market prices, the actual effectiveness in ensuring the 'best' price is relative. Three bidders indicate that the market has viable players, and the government likely received proposals that were competitive. However, a higher number of bidders often correlates with more aggressive pricing. Without knowing the bid prices or the government's cost estimates, it's difficult to definitively state how effective the competition was. The firm fixed price structure, combined with the competitive bidding, provides a baseline for cost control, but ongoing performance monitoring is key to ensuring sustained value.

What are the historical spending patterns for COMBS support or similar services within the Air Force?

Historical spending on Contractor Operated and Maintained Base Supply (COMBS) and similar base support services within the Air Force typically represents a significant portion of the operational budget. These contracts are often long-term due to the nature of base infrastructure and supply chain management. Annual spending can range from tens to hundreds of millions of dollars depending on the size and mission of the bases supported. Analyzing past budgets for COMBS contracts, including previous awards to Vertex Aerospace or its predecessors, and comparing spending trends over the last 5-10 years would reveal patterns of investment in these critical support functions. Fluctuations might be linked to base realignments, changes in operational tempo, or shifts in contracting strategies (e.g., moving from in-house to contracted services).

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

Solicitation ID: FA810616R0013

Offers Received: 3

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: $560,040,622

Exercised Options: $560,040,622

Current Obligation: $560,040,622

Actual Outlays: $24,030,445

Subaward Activity

Number of Subawards: 195

Total Subaward Amount: $30,624,043

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline