Air Force awards $2.16M for aircraft display unit repairs, a sole-source contract

Contract Overview

Contract Amount: $2,161,122 ($2.2M)

Contractor: Honeywell International Inc.

Awarding Agency: Department of Defense

Start Date: 2024-03-06

End Date: 2026-02-09

Contract Duration: 705 days

Daily Burn Rate: $3.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: REPAIR: MULTIPLE DISPLAY UNIT (MDU) FOR MILITARY AIRCRAFT.

Place of Performance

Location: PHOENIX, MARICOPA County, ARIZONA, 85027

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $2.2 million to HONEYWELL INTERNATIONAL INC. for work described as: REPAIR: MULTIPLE DISPLAY UNIT (MDU) FOR MILITARY AIRCRAFT. Key points: 1. Contract awarded on a sole-source basis, raising questions about potential cost savings through competition. 2. The contract duration of 705 days suggests a need for ongoing repair services for critical aircraft components. 3. Awarded by the Department of the Air Force, indicating a focus on maintaining operational readiness for military aircraft. 4. The fixed-price contract type aims to provide cost certainty for the government, but the lack of competition limits price benchmarking. 5. The specific nature of 'Multiple Display Unit' repairs points to specialized technical requirements and limited contractor availability.

Value Assessment

Rating: questionable

Without competitive bids, it is difficult to assess if the $2.16 million price represents fair market value. The lack of competition means there's no benchmark against other suppliers or previous contract awards for similar services. The government may be paying a premium due to the sole-source nature of this award. Further analysis would require access to historical pricing data for this specific component or comparable repair services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one contractor was solicited. This approach is typically used when only one source is capable of meeting the requirement, often due to proprietary technology, unique capabilities, or urgent needs. The lack of competition limits the government's ability to leverage market forces to achieve the best possible price and terms.

Taxpayer Impact: Taxpayers may not be receiving the best value for their money due to the absence of competitive bidding. This could result in higher costs than if multiple companies had vied for the contract.

Public Impact

The primary beneficiaries are the U.S. Air Force, ensuring the continued operational readiness of its aircraft fleet. The contract delivers essential repair services for Multiple Display Units (MDUs), critical components in military aircraft. The geographic impact is primarily within Arizona, where the contractor is located, but the ultimate benefit is to Air Force operations nationwide. The contract supports specialized technical jobs within the aerospace repair sector, contributing to the skilled workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Lack of transparency in the justification for sole-sourcing could mask inefficiencies or missed opportunities for competition.
Dependence on a single supplier for critical aircraft components poses a supply chain risk.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Awarding to Honeywell International Inc. leverages an established aerospace contractor with known capabilities.
Contract ensures the repair of essential aircraft components, maintaining operational readiness.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aircraft parts and repair services. The market for specialized aircraft component repair is often characterized by high barriers to entry due to technical expertise, certifications, and intellectual property. While the overall market for aircraft parts is substantial, the niche for MDU repair may be limited to a few qualified providers, potentially justifying a sole-source award in some circumstances.

Small Business Impact

This contract does not appear to involve small business set-asides, as indicated by 'sb': false. There is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal for this specific award, though the prime contractor may engage small businesses in their broader supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. The firm fixed-price nature of the contract provides some level of cost control. Transparency regarding the justification for the sole-source award and the contractor's performance would be key areas for oversight. Inspector General involvement would be contingent on any reported fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance and Repair
Aerospace Component Manufacturing
Military Aircraft Parts
Defense Logistics

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns without competitive benchmarking

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $2.2 million to HONEYWELL INTERNATIONAL INC.. REPAIR: MULTIPLE DISPLAY UNIT (MDU) FOR MILITARY AIRCRAFT.

Who is the contractor on this award?

The obligated recipient is HONEYWELL INTERNATIONAL INC..

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 $2.2 million.

What is the period of performance?

Start: 2024-03-06. End: 2026-02-09.

What is the specific justification provided by the Air Force for awarding this contract on a sole-source basis to Honeywell International Inc.?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are justified under specific circumstances outlined in federal acquisition regulations, such as when only one responsible source is available, or in cases of urgent and compelling need. For this contract, the Air Force would have had to document why competition was not feasible or advantageous. This could be due to proprietary technology related to the Multiple Display Unit (MDU), unique repair capabilities held exclusively by Honeywell, or a critical and time-sensitive need where initiating a competitive process would cause unacceptable delays. Without the official justification document, it remains speculative, but the lack of competition suggests a high degree of specificity or exclusivity associated with the repair service.

How does the $2.16 million contract value compare to historical spending on MDU repairs for military aircraft?

The provided data does not contain historical spending information for MDU repairs, making a direct comparison impossible. To assess value, one would need to analyze past contracts for similar MDU repair services, potentially across different aircraft platforms or even different branches of the military. Factors such as the number of units repaired, the complexity of the repairs, and inflation over time would need to be considered. A significant increase or decrease compared to historical averages, especially without clear reasons like technological upgrades or changes in operational tempo, could indicate a deviation from expected cost trends. The current sole-source nature of this award further complicates value assessment without comparative data.

What are the potential risks associated with relying on a single contractor, Honeywell International Inc., for critical aircraft display unit repairs?

Relying on a single contractor for critical aircraft display unit repairs presents several risks. Firstly, there's a risk of supply chain disruption; if Honeywell faces production issues, labor strikes, or other operational challenges, the Air Force's ability to maintain its aircraft could be severely impacted. Secondly, the lack of competition can lead to price escalation over time, as the contractor faces no market pressure to offer competitive pricing. Thirdly, there's a risk of technological stagnation; without competitive pressure, the contractor may have less incentive to innovate or improve repair processes. Finally, dependence on one supplier can reduce the government's leverage in negotiations and make it harder to switch providers if performance issues arise or if a more cost-effective solution becomes available elsewhere.

What is the expected performance period and delivery schedule for these MDU repairs, and how does it align with Air Force operational needs?

The contract has a duration of 705 days, with a start date of March 6, 2024, and an end date of February 9, 2026. This duration suggests that the repairs are not for a one-time event but rather an ongoing need for servicing multiple display units over approximately two years. This timeframe aligns with the sustained operational tempo of the Air Force, where aircraft require continuous maintenance to remain mission-ready. The specific delivery schedule for individual repairs would likely be managed through delivery orders issued under this contract, allowing the Air Force flexibility to request repairs as needed based on aircraft availability and maintenance schedules, ensuring that critical components are serviced without disrupting flight operations.

Are there any specific performance metrics or quality standards outlined in the contract to ensure the effectiveness of the MDU repairs?

The provided data indicates the contract type is 'FIRM FIXED PRICE' and the award is a 'DELIVERY ORDER'. While these details specify the payment structure and the mechanism for tasking, they do not explicitly state the performance metrics or quality standards. In a firm fixed-price contract, the contractor is obligated to deliver the goods or services to the specified requirements. However, the specific quality standards, acceptance criteria, and performance metrics (e.g., Mean Time Between Failures for repaired units, repair turnaround time, defect rates) would typically be detailed in the contract's Statement of Work (SOW) or Performance Work Statement (PWS). Without access to these documents, it's impossible to confirm the exact quality assurance measures in place.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Resideo Technologies, Inc.

Address: 21333 N 19TH AVE, PHOENIX, AZ, 85027

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: $2,161,122

Exercised Options: $2,161,122

Current Obligation: $2,161,122

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA811720D0006

IDV Type: IDC

Timeline