DoD awards Boeing $45.5M for aircraft engineering support, a sole-source contract
Contract Overview
Contract Amount: $45,539,035 ($45.5M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2018-02-01
End Date: 2021-04-16
Contract Duration: 1,170 days
Daily Burn Rate: $38.9K/day
Competition Type: NOT COMPETED
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: ENGINEERING SUPPORT SERVICES FOR MULTIPLE AIRCRAFT PLATFORMS
Place of Performance
Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73135
State: Oklahoma Government Spending
Plain-Language Summary
Department of Defense obligated $45.5 million to THE BOEING COMPANY for work described as: ENGINEERING SUPPORT SERVICES FOR MULTIPLE AIRCRAFT PLATFORMS Key points: 1. Contract awarded to a single vendor, limiting competitive pricing. 2. Significant value suggests critical support for multiple aircraft platforms. 3. Fixed Price Incentive contract type aims to balance cost and performance. 4. Engineering services sector is vital for defense readiness and modernization.
Value Assessment
Rating: fair
The $45.5M award for engineering support services appears to be within a reasonable range for complex aircraft platforms, however, the lack of competition makes direct benchmarking difficult. The fixed-price incentive structure suggests an attempt to control costs while ensuring performance.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This approach can lead to higher prices due to the absence of competitive pressure, potentially impacting price discovery and value for taxpayer dollars.
Taxpayer Impact: The sole-source nature of this award raises concerns about potential overpayment and reduced value for taxpayer funds, as competition was not leveraged to secure the best possible price.
Public Impact
Ensures continued operational readiness for critical military aircraft. Supports advanced engineering and technical expertise for complex systems. Potential for cost overruns due to lack of competitive bidding. Impacts the broader aerospace and defense industrial base.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and potential cost savings.
- Lack of transparency in pricing due to no-bid nature.
- Contract duration extends over multiple fiscal years.
Positive Signals
- Provides essential engineering support for vital defense assets.
- Fixed Price Incentive contract aims for performance and cost control.
Sector Analysis
This contract falls within the Engineering Services sector, which is crucial for the defense industry's ability to maintain and upgrade complex weapon systems. Spending in this area is often driven by specialized expertise and long-term platform support needs.
Small Business Impact
The contract was awarded to The Boeing Company, a large prime contractor. There is no indication of subcontracting opportunities for small businesses within the provided data, suggesting limited direct impact on the small business sector for this specific award.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, is responsible for overseeing this contract. The fixed-price incentive structure implies performance metrics that should be monitored to ensure accountability and value.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award lacks competitive pricing.
- Potential for cost overruns without strong oversight.
- Limited transparency on specific cost drivers.
- Dependency on a single contractor for critical support.
Tags
engineering-services, department-of-defense, ok, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $45.5 million to THE BOEING COMPANY. ENGINEERING SUPPORT SERVICES FOR MULTIPLE AIRCRAFT PLATFORMS
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $45.5 million.
What is the period of performance?
Start: 2018-02-01. End: 2021-04-16.
What specific engineering challenges or requirements necessitated a sole-source award for these aircraft platforms?
A sole-source award is typically justified when only one vendor possesses the unique capabilities, proprietary knowledge, or existing infrastructure required for a specific service. For complex aircraft platforms, this could involve specialized design modifications, sustainment engineering for aging systems, or integration of new technologies where Boeing holds critical intellectual property or extensive historical data.
How does the fixed-price incentive structure mitigate the risks associated with a sole-source award?
The Fixed Price Incentive (FPI) contract type aims to mitigate sole-source risks by establishing target costs, target profits, and sharing formulas. If the contractor performs below the target cost, both parties share in the savings. Conversely, if costs exceed the target, the contractor bears a greater portion of the overrun up to a ceiling price. This incentivizes efficiency and cost control despite the lack of initial competition.
What is the long-term strategic value of this engineering support contract for the Department of Defense?
The long-term strategic value lies in ensuring the continued operational effectiveness and modernization of multiple aircraft platforms. This support is critical for maintaining air superiority, readiness, and adapting to evolving threats. By securing specialized engineering expertise, the DoD can extend the lifecycle of its assets and integrate necessary upgrades, contributing to national security objectives.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 6001 S AIR DEPOT BLVD, OKLAHOMA CITY, OK, 73135
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $53,341,429
Exercised Options: $53,341,429
Current Obligation: $45,539,035
Subaward Activity
Number of Subawards: 26
Total Subaward Amount: $3,019,497
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA810617D0002
IDV Type: IDC
Timeline
Start Date: 2018-02-01
Current End Date: 2021-04-16
Potential End Date: 2021-04-16 00:00:00
Last Modified: 2023-09-28
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