DoD awards $29.6M to Boeing for C-32/C-40 aircraft fleet logistics support

Contract Overview

Contract Amount: $29,623,108 ($29.6M)

Contractor: Boeing Aerospace Operations, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-07-01

End Date: 2024-07-26

Contract Duration: 756 days

Daily Burn Rate: $39.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CONTRACTOR LOGISTICS SUPPORT FOR C-32 C-40 AIRCRAFT FLEET

Place of Performance

Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $29.6 million to BOEING AEROSPACE OPERATIONS, INC. for work described as: CONTRACTOR LOGISTICS SUPPORT FOR C-32 C-40 AIRCRAFT FLEET Key points: 1. Contract provides essential logistics support for critical military aircraft. 2. Boeing Aerospace Operations, Inc. is the sole awardee. 3. The contract is structured as a Firm Fixed Price Delivery Order. 4. Performance period spans over two years, indicating a medium-term commitment. 5. The award falls under Other Support Activities for Air Transportation. 6. No small business set-aside was utilized for this procurement.

Value Assessment

Rating: good

The contract value of $29.6 million for two years of logistics support for the C-32 and C-40 aircraft fleet appears reasonable given the specialized nature of military aviation support. Benchmarking against similar contracts for fleet sustainment of comparable aircraft types would provide a more precise value-for-money assessment. However, the firm fixed-price structure generally offers cost certainty to the government, assuming the scope of work is well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely solicited. The specific number of bidders is not provided, but the designation suggests a competitive process was followed. Full and open competition is generally expected to yield better pricing and a wider range of solutions for the government.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

Ensures the operational readiness and sustainment of the C-32 and C-40 aircraft fleets, vital for government and military transport. Supports the U.S. Department of Defense's aviation capabilities. The contract is managed by the Defense Contract Management Agency. Benefits likely accrue to military personnel and government officials who rely on these aircraft for transportation. Workforce implications may include specialized technical and logistical personnel employed by Boeing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific bidder count limits assessment of competitive intensity.
Details on performance metrics and quality assurance are not readily available.
Potential for cost overruns if unforeseen technical issues arise with the aircraft fleet.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
Firm Fixed Price contract type provides cost predictability.
Long-term support contract indicates a commitment to fleet readiness.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aviation support services. The market for military aircraft logistics and sustainment is highly specialized, often dominated by original equipment manufacturers like Boeing or dedicated defense contractors. Spending in this area is driven by the need to maintain the operational readiness of aging and complex military fleets, ensuring their availability and safety. Comparable spending benchmarks would involve analyzing other sustainment contracts for similar military transport or special mission aircraft.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses indicated in the provided data. This suggests that the primary award went to a large business, and any small business participation would likely be through Boeing's general supply chain or subcontracting efforts, rather than a mandated set-aside.

Oversight & Accountability

The contract is managed by the Defense Contract Management Agency (DCMA), which provides contract administration services to ensure contractor performance and compliance. Oversight mechanisms would typically include regular performance reviews, audits, and adherence to the terms and conditions of the firm fixed-price delivery order. Transparency is facilitated through contract award databases, though detailed performance metrics may be internal.

Related Government Programs

Military Aircraft Maintenance
Aerospace Logistics Support
Defense Transportation Services
Fleet Sustainment Programs

Risk Flags

Potential for cost growth if scope is not tightly managed.
Reliance on a single OEM could limit future competitive options.
Performance metrics and quality assurance details are not publicly detailed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.6 million to BOEING AEROSPACE OPERATIONS, INC.. CONTRACTOR LOGISTICS SUPPORT FOR C-32 C-40 AIRCRAFT FLEET

Who is the contractor on this award?

The obligated recipient is BOEING AEROSPACE OPERATIONS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $29.6 million.

What is the period of performance?

Start: 2022-07-01. End: 2024-07-26.

What is Boeing's track record in providing logistics support for similar military aircraft fleets?

Boeing Aerospace Operations, Inc., as a subsidiary of The Boeing Company, has an extensive history of providing logistics, maintenance, and sustainment services for a wide array of military aircraft, including transport, bomber, and fighter platforms. Their experience encompasses global support, supply chain management, engineering services, and depot-level maintenance. For specific fleets like the C-32 (a modified Boeing 757) and C-40 (a military variant of the Boeing 737), Boeing is the original equipment manufacturer, giving them unique insights into the aircraft's design, performance, and maintenance requirements. This OEM status often translates into a strong capability for providing specialized logistics support, though it can also limit competition. Historical performance data from previous contracts would be crucial for a comprehensive assessment of their reliability and efficiency in fulfilling such roles.

How does the awarded price compare to industry benchmarks for similar logistics support contracts?

Directly comparing the $29.6 million contract value for two years of logistics support for the C-32/C-40 fleet against public benchmarks is challenging without more specific details on the scope of services, required maintenance levels, and geographic coverage. However, military aircraft sustainment contracts are typically high-value due to the complexity, specialized labor, and parts required. The firm fixed-price nature of this award suggests the government sought cost certainty. Industry averages for similar fleet sustainment can range from tens to hundreds of millions of dollars annually, depending on the aircraft type, age, operational tempo, and the breadth of services (e.g., scheduled maintenance, unscheduled repairs, component overhaul, supply chain management). Given the C-32 and C-40 are VIP/staff transport aircraft with potentially high utilization, the awarded amount appears within a plausible range, but a detailed cost analysis or comparison with other DoD contracts for similar platforms would be necessary for a definitive value assessment.

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

Primary risks include potential cost overruns if the firm fixed-price contract doesn't adequately account for unforeseen maintenance needs or parts obsolescence, especially for aging aircraft. Performance risks involve ensuring consistent operational availability and timely repairs, which are critical for the C-32 and C-40 fleets' mission effectiveness. Contractor performance issues, such as delays or quality deficiencies, could impact readiness. Mitigation strategies likely include robust contract oversight by the Defense Contract Management Agency (DCMA), clear performance metrics and service level agreements within the contract, and Boeing's inherent knowledge as the OEM. The firm fixed-price structure itself acts as a risk mitigation tool for the government by capping costs, provided the scope is well-defined and change orders are managed strictly.

What is the expected program effectiveness and impact on the DoD's operational capabilities?

The expected program effectiveness is high, as this contract directly addresses the sustainment needs of the C-32 and C-40 aircraft fleets. These aircraft are crucial for transporting senior government officials, military leadership, and diplomatic personnel, both domestically and internationally. Ensuring their continuous operational readiness and safety through dedicated logistics support is paramount for national security and diplomatic functions. Effective execution of this contract will directly contribute to the Department of Defense's ability to project leadership, conduct essential travel, and maintain critical communication lines, thereby enhancing overall operational capabilities and governmental functions.

How does this contract's spending compare to historical spending on similar aircraft fleet support?

Analyzing historical spending requires access to detailed contract databases tracking support for the C-32 and C-40 fleets specifically, or comparable VIP/staff transport aircraft. The provided data indicates a $29.6 million award for a 756-day period (approx. 2 years). If this represents annual spending, it would be around $14.8 million per year. Historical data would reveal if this figure is consistent with previous support contracts, higher, or lower, potentially indicating changes in maintenance requirements, parts costs, or contract scope. Without prior contract values, it's difficult to establish a trend. However, sustainment costs for specialized aircraft fleets often increase over time due to aging components and evolving maintenance needs, making consistent or slightly increasing annual spending plausible.

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

Parent Company: THE Boeing Company

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: $30,258,965

Exercised Options: $30,258,965

Current Obligation: $29,623,108

Subaward Activity

Number of Subawards: 14

Total Subaward Amount: $23,334,598

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA810616D0004

IDV Type: IDC

Timeline