DoD Awards Boeing $85.5M for Engineering Support, Raising Questions on Competition

Contract Overview

Contract Amount: $85,523,344 ($85.5M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2023-02-01

End Date: 2027-03-18

Contract Duration: 1,506 days

Daily Burn Rate: $56.8K/day

Competition Type: NOT COMPETED

Pricing Type: FIXED PRICE INCENTIVE

Sector: Defense

Official Description: ENGINEERING SUPPORT SERVICES FOR MULTIPLE PLATFORMS.

Place of Performance

Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73135

State: Oklahoma Government Spending

Plain-Language Summary

Department of Defense obligated $85.5 million to THE BOEING COMPANY for work described as: ENGINEERING SUPPORT SERVICES FOR MULTIPLE PLATFORMS. Key points: 1. Significant contract value for specialized engineering services. 2. Sole-source award to Boeing limits competitive pricing. 3. Long-term contract duration (2027) warrants ongoing scrutiny. 4. Potential for cost overruns due to fixed-price incentive structure.

Value Assessment

Rating: questionable

The $85.5 million award for engineering support services is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to The Boeing Company. This lack of competition limits price discovery and may lead to higher costs for taxpayers.

Taxpayer Impact: The absence of competition in this sole-source award means taxpayers may not be receiving the best possible price for these critical engineering services.

Public Impact

Taxpayers may be overpaying due to the lack of competitive bidding. The long duration of the contract could lock in potentially inflated costs. Dependence on a single contractor for essential engineering support poses a risk.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Potential for cost overruns
Long contract duration

Positive Signals

Essential engineering support for multiple platforms
Established contractor with relevant experience

Sector Analysis

Engineering services are crucial for maintaining complex defense platforms. The $85.5 million awarded is significant, but benchmarks are hard to establish without competitive data for this specific sole-source contract.

Small Business Impact

This contract does not appear to involve small business participation, as it was awarded directly to a large prime contractor without a small business set-aside or subcontracting plan mentioned.

Oversight & Accountability

The sole-source nature of this award necessitates robust oversight to ensure the contractor is performing efficiently and that costs are reasonable throughout the contract's life.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Lack of competition
Potential for cost overruns
Sole-source award
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $85.5 million to THE BOEING COMPANY. ENGINEERING SUPPORT SERVICES FOR MULTIPLE PLATFORMS.

Who is the contractor on this award?

The obligated recipient is THE BOEING 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 $85.5 million.

What is the period of performance?

Start: 2023-02-01. End: 2027-03-18.

What justification was provided for the sole-source award, and were alternatives explored?

The provided data indicates the contract was 'NOT COMPETED,' suggesting a sole-source justification was likely invoked. Further investigation into the specific justification (e.g., unique capabilities, urgent need) and whether any market research was conducted to explore competitive alternatives is crucial for assessing value and fairness.

How will the fixed-price incentive structure be monitored to prevent cost overruns?

The fixed-price incentive (FPI) contract type aims to share cost savings and overruns between the government and contractor. Effective monitoring requires clear performance metrics, regular cost reviews, and strong negotiation of target costs and incentive fees to ensure the government benefits from efficiencies and avoids excessive spending.

What is the long-term strategy for ensuring competitive pricing for future engineering support needs?

Given this sole-source award, the Department of Defense should proactively plan for future procurements. This includes conducting thorough market research to identify potential competitors, developing strategies to break down the requirement into smaller, more competitive lots, and fostering an environment where new entrants can emerge.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

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: $85,523,344

Exercised Options: $85,523,344

Current Obligation: $85,523,344

Subaward Activity

Number of Subawards: 17

Total Subaward Amount: $7,346,433

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA810617D0002

IDV Type: IDC

Timeline