DoD awards $44.5M to Boeing for B-1/B-52 Engineering Services, raising cost concerns
Contract Overview
Contract Amount: $44,468,380 ($44.5M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2019-06-01
End Date: 2022-06-30
Contract Duration: 1,125 days
Daily Burn Rate: $39.5K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: B-1 B-52 ENGINEERING SERVICES
Place of Performance
Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73135
State: Oklahoma Government Spending
Plain-Language Summary
Department of Defense obligated $44.5 million to THE BOEING COMPANY for work described as: B-1 B-52 ENGINEERING SERVICES Key points: 1. Significant contract value for specialized aircraft engineering. 2. Sole-source award limits competitive pricing discovery. 3. Potential for cost overruns with Cost Plus Fixed Fee structure. 4. Focus on legacy aircraft maintenance and modernization.
Value Assessment
Rating: questionable
The contract's Cost Plus Fixed Fee structure, combined with a sole-source award, presents a risk of inflated costs. Benchmarking is difficult without competitive data, but the total award value is substantial for engineering services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This lack of competition limits the government's ability to secure the best possible price through market forces.
Taxpayer Impact: The absence of competition may lead to taxpayers paying a premium for these essential engineering services.
Public Impact
Ensures continued operational readiness of critical bomber fleets. Supports high-skilled engineering jobs within the aerospace sector. Potential for extended sustainment costs for aging aircraft.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of competition
- Aging aircraft sustainment
Positive Signals
- Essential for national defense
- Maintains critical capabilities
Sector Analysis
This contract falls within the Defense sector, specifically supporting the sustainment and engineering of legacy aircraft. Spending benchmarks for similar specialized engineering services can vary widely based on complexity and aircraft type.
Small Business Impact
This contract does not appear to have specific provisions for small business participation. The prime contractor, Boeing, is a large aerospace corporation, and the nature of the services may not lend itself to subcontracting with small businesses.
Oversight & Accountability
Oversight of this sole-source, cost-plus contract is crucial to ensure that costs are reasonable and that the services provided are necessary and effective. The Air Force must diligently monitor expenditures and performance.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits price competition.
- Cost-plus contract type increases risk of cost overruns.
- Aging aircraft require ongoing, potentially expensive, sustainment.
- Lack of transparency in pricing due to non-competitive nature.
Tags
aircraft-manufacturing, department-of-defense, ok, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $44.5 million to THE BOEING COMPANY. B-1 B-52 ENGINEERING SERVICES
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 $44.5 million.
What is the period of performance?
Start: 2019-06-01. End: 2022-06-30.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, proprietary data, or urgent needs that cannot be met through competition. Without further documentation, it's difficult to assess if alternative competitive strategies were thoroughly explored or if this award represents the only viable option for maintaining critical B-1 and B-52 aircraft engineering support.
How will the Cost Plus Fixed Fee structure be managed to prevent cost overruns and ensure value for taxpayers?
Effective management of a Cost Plus Fixed Fee contract requires robust government oversight, including detailed cost tracking, performance monitoring, and regular audits. The Air Force must establish clear performance metrics and fee structures that incentivize efficiency and cost control, while ensuring that all costs incurred are reasonable, allocable, and allowable.
What is the long-term strategy for the sustainment of the B-1 and B-52 fleets, and how does this contract align with it?
This contract addresses immediate engineering needs for the B-1 and B-52 fleets. However, the long-term strategy for these aging aircraft requires a comprehensive plan that may include upgrades, life extensions, or eventual replacement. Understanding how this current engineering support fits into that broader strategic vision is essential for efficient resource allocation and future modernization efforts.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: FA810718R0002
Pricing Type: COST PLUS FIXED FEE (U)
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: $44,468,380
Exercised Options: $44,468,380
Current Obligation: $44,468,380
Actual Outlays: $4,614,562
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA810719D0001
IDV Type: IDC
Timeline
Start Date: 2019-06-01
Current End Date: 2022-06-30
Potential End Date: 2022-06-30 00:00:00
Last Modified: 2023-11-01
More Contracts from THE Boeing Company
- KC-X Modernization Program — $32.0B (Department of Defense)
- International Space Station — $22.4B (National Aeronautics and Space Administration)
- 200112!000108!9700!ZD60 !ballistic Missile Defense ORG. !HQ000601C0001 !A!N!*!N! !20001222!20080930!848025649!848025649!009256819!n!the Boeing Company !3370 E Miraloma AVE !anaheim !ca!92806!37000!089!01!huntsville !madison !alabama !+000383571022!n!n!000000000000!ad93!rdte/Other Defense-Adv Tech DEV !S1 !services !1caa!ballistic Missile Defense SYS !541710!*!*!3! ! ! !*!*!*!B!*!*!A! !A !U!R!2!001!B! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! — $18.8B (Department of Defense)
- USN P-8A FRP II Long Lead Material — $18.1B (Department of Defense)
- 200512!010860!2100!w56hzv!tacom - Warren !w56hzv05c0724 !A!N! !Y! ! !20050923!20141231!016544780!016544780!009256819!n!the Boeing Company !J S Mcdonnell Blvd !saint Louis !mo!63166!65000!510!29!st. Louis !ST. Louis (city) !missouri !+000219245691!n!n!000000000000!az15!rdte/Other Research&development-Eng/Manuf Devel !S1 !services !301 !FCS !541330!E! !1! ! ! ! ! !20200930!B! ! !A! !d!u!u!1!001!n!1a!z!y!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! TAS::21 2040::TAS — $12.7B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)