Vertex Aerospace LLC awarded $24.6M for C12 Fleet logistics support, highlighting potential value in specialized aviation services

Contract Overview

Contract Amount: $24,633,933 ($24.6M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2019-01-01

End Date: 2019-12-31

Contract Duration: 364 days

Daily Burn Rate: $67.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CONTRACOR LOGISTICS SUPPORT (CLS) FOR C12 FLEET

Place of Performance

Location: MADISON, MADISON County, MISSISSIPPI, 39110

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $24.6 million to VERTEX AEROSPACE LLC for work described as: CONTRACOR LOGISTICS SUPPORT (CLS) FOR C12 FLEET Key points: 1. The contract value of $24.6 million for a one-year period suggests a significant investment in maintaining the C12 fleet. 2. Vertex Aerospace LLC's win indicates a competitive landscape for specialized aviation logistics, with potential for other firms to bid on similar contracts. 3. The firm fixed-price contract type generally offers good value by shifting cost overrun risks to the contractor. 4. Performance context is crucial; the effectiveness of logistics support directly impacts aircraft readiness and operational efficiency. 5. This contract falls within the broader defense aviation support sector, which is characterized by high technical requirements and specialized expertise. 6. The absence of small business set-aside suggests the primary focus was on technical capability and best value, not necessarily small business participation.

Value Assessment

Rating: good

The contract value of $24.6 million for a 12-month period for C12 fleet logistics support appears reasonable given the specialized nature of military aviation maintenance. Benchmarking against similar contracts for fleet support services would provide a more precise assessment of value for money. The firm fixed-price structure is a positive indicator for cost control, as it incentivizes the contractor to manage expenses efficiently. Without specific performance metrics or detailed cost breakdowns, a definitive value assessment is challenging, but the award suggests the government perceived this as a competitive and fair price for the required services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. This approach is designed to foster a competitive environment, which typically leads to better pricing and service quality for the government. The number of bidders is not specified, but the 'full and open' designation implies a robust competition process was intended. The success of this competition in driving down costs and improving service offerings would depend on the number and capability of the participating firms.

Taxpayer Impact: Full and open competition generally benefits taxpayers by ensuring that the government receives the best possible value through a wide range of offers and potentially lower prices due to market pressures.

Public Impact

The primary beneficiaries are the military personnel and units relying on the operational readiness of the C12 fleet. This contract delivers essential logistics support, including maintenance, repair, and supply chain management for C12 aircraft. The geographic impact is likely concentrated around bases where C12 aircraft are operated and maintained, potentially supporting local economies through contractor employment. Workforce implications include the employment of skilled aviation mechanics, technicians, and logistics personnel by Vertex Aerospace LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen technical issues arise with the C12 fleet, despite the firm fixed-price structure.
Dependence on a single contractor for critical logistics functions could create vulnerabilities if performance falters.
Ensuring consistent quality of maintenance across all C12 aircraft requires robust oversight.
The specific technical requirements of the C12 fleet may limit the pool of qualified contractors in future competitions.

Positive Signals

Firm fixed-price contract type shifts cost risk to the contractor, promoting cost efficiency.
Awarded through full and open competition, suggesting a competitive process likely yielded a fair price.
Vertex Aerospace LLC's specialization in aviation logistics indicates a focus on technical expertise.
The contract duration provides a stable period for service delivery and performance evaluation.

Sector Analysis

This contract operates within the broader aerospace and defense industry, specifically focusing on aviation support services. The market for military aircraft maintenance and logistics is substantial, driven by the need to maintain high operational readiness for aging and complex fleets. Companies like Vertex Aerospace LLC compete on technical expertise, past performance, and pricing. Comparable spending benchmarks would involve analyzing other contracts for similar fleet support services across different branches of the military or allied nations.

Small Business Impact

The contract was not set aside for small businesses, as indicated by 'sb': false. This suggests that the competition was open to all responsible sources, and the selection criteria prioritized technical capability and overall best value rather than small business participation. While this contract may not directly involve small business set-asides, Vertex Aerospace LLC might engage small businesses as subcontractors for specialized services or parts, contributing indirectly to the small business ecosystem. Further analysis would be needed to determine the extent of small business subcontracting.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures would include performance reviews, adherence to contract terms, and quality control processes. Transparency is facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Aircraft Maintenance Services
Logistics and Supply Chain Management
Defense Aviation Support
Military Fleet Support
Aerospace Logistics

Risk Flags

Potential for performance issues impacting aircraft readiness.
Risk of cost increases if unforeseen maintenance needs arise.
Dependence on contractor's supply chain for parts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.6 million to VERTEX AEROSPACE LLC. CONTRACOR LOGISTICS SUPPORT (CLS) FOR C12 FLEET

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $24.6 million.

What is the period of performance?

Start: 2019-01-01. End: 2019-12-31.

What is Vertex Aerospace LLC's track record with similar Department of Defense contracts?

Vertex Aerospace LLC has a history of performing various aviation support services for the Department of Defense. Their portfolio often includes maintenance, repair, and overhaul (MRO) services, as well as logistics and supply chain management for different aircraft platforms. Analyzing their past performance on similar firm-fixed-price contracts, particularly those involving fleet support or specialized aircraft, would reveal their ability to manage costs, meet delivery schedules, and maintain quality standards. A review of contract databases and performance reports (if publicly available) would provide insights into their reliability and any past issues or commendations received. Their experience with the C12 platform specifically would be a key indicator of their suitability for this contract.

How does the awarded value compare to industry benchmarks for C12 fleet logistics support?

The awarded value of $24.6 million for a one-year contract for C12 fleet logistics support needs to be benchmarked against similar contracts to assess value for money. Industry benchmarks for specialized aviation logistics can vary significantly based on the scope of services (e.g., scheduled maintenance, unscheduled repairs, parts provisioning, depot-level support), the specific C12 variant, and the geographic locations of operations. Without access to proprietary industry data or a detailed breakdown of the services included in this contract, a precise comparison is difficult. However, the 'full and open competition' award suggests that the price was deemed competitive by the Department of Defense, implying it falls within an acceptable range for the market.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract include potential cost overruns if unexpected maintenance issues arise with the C12 fleet, performance degradation impacting aircraft readiness, and supply chain disruptions for critical parts. Mitigation strategies are embedded within the contract structure and oversight. The firm fixed-price (FFP) nature of the contract shifts the financial risk of cost overruns to Vertex Aerospace LLC. Performance standards and key performance indicators (KPIs) are typically defined in the contract, allowing the government to monitor and enforce service levels. The government's oversight, likely by the DCMA, includes quality assurance checks and regular performance reviews. Furthermore, the competitive award process itself helps mitigate risks by selecting a contractor with a demonstrated capability to perform.

How effective is the firm fixed-price contract type in ensuring value for this type of service?

The firm fixed-price (FFP) contract type is generally considered effective for ensuring value in services where the scope of work is well-defined and risks can be reasonably estimated, such as routine logistics support and maintenance. For this C12 fleet contract, FFP incentivizes Vertex Aerospace LLC to control costs and operate efficiently, as any savings achieved below the agreed price benefit the contractor, while cost overruns are absorbed by them. This structure provides cost certainty for the government. However, if unforeseen technical complexities or extensive repairs are required beyond the initial scope, the FFP structure might lead to contractor reluctance to perform additional work or potential disputes if contract modifications are necessary. Robust initial scope definition and clear performance expectations are crucial for FFP effectiveness.

What is the historical spending pattern for C12 fleet logistics support by the Department of Defense?

Historical spending on C12 fleet logistics support by the Department of Defense would likely show a consistent requirement for maintenance and operational readiness funding over the years. The C12 is a versatile utility transport aircraft used across multiple branches, meaning spending is distributed. Annual expenditures can fluctuate based on the fleet's age, operational tempo, and specific modernization or upgrade programs. Analyzing past contract awards for C12 support, including durations, values, and awarded contractors, would reveal trends in spending, competition levels, and the evolution of support strategies. This specific $24.6 million award for one year represents a snapshot within this broader historical context of sustaining the C12 fleet.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 555 INDUSTRIAL DR S, MADISON, MS, 39110

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $24,633,933

Exercised Options: $24,633,933

Current Obligation: $24,633,933

Actual Outlays: $1,197,893

Subaward Activity

Number of Subawards: 7

Total Subaward Amount: $971,483

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA810617D0001

IDV Type: IDC

Timeline