DoD awards $63M for T108 Engine Sustainment, with Rolls-Royce Corporation as the sole provider
Contract Overview
Contract Amount: $62,918,860 ($62.9M)
Contractor: Rolls-Royce Corporation
Awarding Agency: Department of Defense
Start Date: 2023-08-01
End Date: 2023-11-30
Contract Duration: 121 days
Daily Burn Rate: $520.0K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: T108 ENGINE, NACELLE, AND PROPELLER SUSTAINMENT. PRICE PER FLYING HOUR.
Place of Performance
Location: INDIANAPOLIS, MARION County, INDIANA, 46225
State: Indiana Government Spending
Plain-Language Summary
Department of Defense obligated $62.9 million to ROLLS-ROYCE CORPORATION for work described as: T108 ENGINE, NACELLE, AND PROPELLER SUSTAINMENT. PRICE PER FLYING HOUR. Key points: 1. Significant contract value for aircraft engine sustainment. 2. Sole-source award to Rolls-Royce Corporation raises competition concerns. 3. Potential for higher costs due to lack of competitive bidding. 4. Sector focus on Aircraft Engine Manufacturing.
Value Assessment
Rating: questionable
The contract is a sole-source award, making direct price comparisons difficult. Without competitive bidding, it's challenging to assess if the $62.9M price represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Rolls-Royce Corporation. This limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for engine sustainment services.
Public Impact
Ensures continued operational readiness for critical military aircraft. Supports a major defense contractor and its supply chain. Highlights reliance on specific manufacturers for specialized equipment.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
Positive Signals
- Ensures critical sustainment
- Supports operational readiness
Sector Analysis
This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector. Spending in this sector is critical for maintaining military aviation capabilities, but sole-source awards can inflate costs compared to competitive markets.
Small Business Impact
The data does not indicate any specific provisions or benefits for small businesses in this sole-source contract.
Oversight & Accountability
Oversight is crucial for sole-source contracts to ensure fair pricing and prevent potential waste. The Defense Contract Management Agency is responsible for administering this award.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for cost escalation without competitive pressure.
- Reliance on a single supplier for critical components.
- Lack of transparency in pricing justification.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, in, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $62.9 million to ROLLS-ROYCE CORPORATION. T108 ENGINE, NACELLE, AND PROPELLER SUSTAINMENT. PRICE PER FLYING HOUR.
Who is the contractor on this award?
The obligated recipient is ROLLS-ROYCE CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $62.9 million.
What is the period of performance?
Start: 2023-08-01. End: 2023-11-30.
What is the historical pricing trend for this specific engine sustainment service from Rolls-Royce?
Analyzing historical pricing data for this T108 engine sustainment from Rolls-Royce is essential. Without it, it's difficult to determine if the current $62.9M award represents an increase or decrease in cost over time, especially given the sole-source nature of the contract. This trend analysis would provide a baseline for assessing value.
Are there any alternative sustainment solutions or potential competitors that could be developed or engaged in the future?
Exploring alternative sustainment solutions or fostering competition for the T108 engine is vital to mitigate long-term risks and costs. While this award is sole-source, future strategies should consider developing capabilities within other firms or exploring remanufacturing options to introduce competition and potentially lower prices.
How does the price per flying hour for this contract compare to similar engine sustainment contracts for other military aircraft platforms?
Benchmarking the price per flying hour against similar sustainment contracts for other military aircraft is a key indicator of value. Given this is a sole-source award, a direct comparison is challenging. However, understanding the range of costs for comparable services can highlight potential inefficiencies or premium pricing in this specific contract.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Rolls-Royce Holdings PLC
Address: 450 S MERIDIAN ST, INDIANAPOLIS, IN, 46225
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $62,918,860
Exercised Options: $62,918,860
Current Obligation: $62,918,860
Subaward Activity
Number of Subawards: 21
Total Subaward Amount: $61,813,098
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA812423D0002
IDV Type: IDC
Timeline
Start Date: 2023-08-01
Current End Date: 2023-11-30
Potential End Date: 2023-11-30 00:00:00
Last Modified: 2025-04-16
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