DoD's $46.5M F-16 Engine SLEP Kits Contract Awarded to GE Amidst Limited Competition
Contract Overview
Contract Amount: $46,525,638 ($46.5M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2021-06-21
End Date: 2022-11-15
Contract Duration: 512 days
Daily Burn Rate: $90.9K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: EQYPTIAN AIR FORCE (EAF) F110-100 SERVICE LIFE EXTENSION PROGRAM (SLEP) KITS FOR F-16 FLEET.
Place of Performance
Location: CINCINNATI, HAMILTON County, OHIO, 45215
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $46.5 million to GENERAL ELECTRIC COMPANY for work described as: EQYPTIAN AIR FORCE (EAF) F110-100 SERVICE LIFE EXTENSION PROGRAM (SLEP) KITS FOR F-16 FLEET. Key points: 1. The contract focuses on Service Life Extension Program (SLEP) kits for the Egyptian Air Force's F-16 fleet. 2. General Electric Company is the sole awardee, indicating a lack of broader competition for these specialized kits. 3. The firm fixed-price contract aims to extend the operational life of critical aircraft engines. 4. This spending falls under the Defense sector, specifically aircraft engine parts manufacturing.
Value Assessment
Rating: fair
The contract value of $46.5M for SLEP kits is difficult to assess without specific per-unit cost data or benchmarks for similar F-16 engine upgrades. The firm fixed-price nature suggests cost certainty for the government, but the lack of competitive bidding raises questions about optimal pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not available for competition, suggesting a sole-source or limited-source award, likely due to the specialized nature of the SLEP kits and the original equipment manufacturer's role. This limits price discovery and potentially increases costs compared to a fully competitive environment.
Taxpayer Impact: Taxpayer impact is indirect, as this contract supports a foreign military sale, not direct US Air Force operations. However, the lack of competition could lead to higher overall program costs.
Public Impact
Supports the operational readiness of an allied air force's F-16 fleet. Ensures the continued serviceability of advanced aircraft engines through life extension. Highlights the reliance on original equipment manufacturers for specialized aircraft sustainment. Potential for follow-on sustainment and support contracts for the Egyptian Air Force.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition may lead to higher costs.
- Lack of transparency in pricing due to sole-source nature.
- Dependence on a single supplier for critical components.
Positive Signals
- Extends the life of valuable military assets.
- Ensures operational capability for a key ally.
- Firm fixed-price contract provides cost predictability.
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft engine components and sustainment. Spending benchmarks for such specialized upgrade kits are highly variable and depend on the specific technology and scope of the SLEP.
Small Business Impact
The awardee, General Electric Company, is a large prime contractor. There is no indication of small business participation in this specific delivery order, which is common for highly specialized defense manufacturing requiring proprietary technology and extensive R&D.
Oversight & Accountability
The Department of the Air Force, as the contracting activity, is responsible for oversight. The firm fixed-price contract type provides some level of cost control, but the limited competition necessitates careful monitoring of performance and any potential price escalations.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for cost overruns due to limited competition.
- Dependency on a single supplier for critical components.
- Lack of transparency in pricing justification.
- Risk of obsolescence if technology is not updated.
- Foreign military sales contracts can be complex to oversee.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, oh, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $46.5 million to GENERAL ELECTRIC COMPANY. EQYPTIAN AIR FORCE (EAF) F110-100 SERVICE LIFE EXTENSION PROGRAM (SLEP) KITS FOR F-16 FLEET.
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC 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 $46.5 million.
What is the period of performance?
Start: 2021-06-21. End: 2022-11-15.
What is the specific technical scope of the SLEP kits and how do they enhance the F110-100 engine's performance and lifespan?
The Service Life Extension Program (SLEP) kits are designed to overhaul and upgrade critical components within the F110-100 engine, addressing wear and tear accumulated over years of operation. This process typically involves replacing aging parts, incorporating design improvements, and recertifying the engine to extend its operational life by a significant number of flight hours or years, thereby enhancing overall fleet readiness and reducing the need for premature engine replacements.
How does the limited competition for these SLEP kits impact the long-term sustainment costs for the Egyptian Air Force's F-16 fleet?
Limited competition, especially when relying on the original equipment manufacturer (OEM), often results in higher unit costs compared to a competitive bidding process. This can lead to increased long-term sustainment expenses for the Egyptian Air Force. Without competitive pressure, the OEM may charge premium prices for the kits and associated services, potentially impacting the overall affordability of maintaining the F-16 fleet over its extended service life.
What are the potential risks associated with relying solely on General Electric for these critical F-16 engine upgrade kits?
The primary risk is the lack of leverage in price negotiations and potential supply chain vulnerabilities if GE faces production issues. Dependence on a single supplier can also limit access to technological advancements from competitors and may result in higher long-term maintenance costs. Furthermore, if GE's strategic priorities shift, it could impact the availability and support for these specific kits, potentially affecting the operational readiness of the EAF's F-16s.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: ENGINES AND TURBINES AND COMPONENT
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 NEUMANN WAY, CINCINNATI, OH, 45215
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: $46,525,638
Exercised Options: $46,525,638
Current Obligation: $46,525,638
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA812219D0001
IDV Type: IDC
Timeline
Start Date: 2021-06-21
Current End Date: 2022-11-15
Potential End Date: 2022-11-15 00:00:00
Last Modified: 2022-04-08
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