Defense Logistics Agency awards $780M contract for aircraft landing gear components, with a 5-year period of performance

Contract Overview

Contract Amount: $15,796,652 ($15.8M)

Contractor: Goodrich Corp

Awarding Agency: Department of Defense

Start Date: 2006-09-29

End Date: 2014-07-01

Contract Duration: 2,832 days

Daily Burn Rate: $5.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Defense

Official Description: 200612!000716!5700!FA8203!OO-ALC/PKI/LGJL !FA820306C0246 !A!N! !N! ! !20060929!20110430!780459749!780459749!004467452!N!GOODRICH CORPORATION !8000 MARBLE AVE !CLEVELAND !OH!44105!16000!035!39!CLEVELAND !CUYAHOGA !OHIO !+000016007139!N!N!000000000000!1620!AIRCRAFT LANDING GEAR COMPONENTS !A1A!AIRFRAMES AND SPARES !000 !NOT DISCERNABLE !336413!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!K!2!001!B! !A!Y!A! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: CLEVELAND, CUYAHOGA County, OHIO, 44105

State: Ohio Government Spending

Plain-Language Summary

Department of Defense obligated $15.8 million to GOODRICH CORP for work described as: 200612!000716!5700!FA8203!OO-ALC/PKI/LGJL !FA820306C0246 !A!N! !N! ! !20060929!20110430!780459749!780459749!004467452!N!GOODRICH CORPORATION !8000 MARBLE AVE !CLEVELAND !OH!44105!16000!035!39!CLEVELAND !CUYA… Key points: 1. Contract value of $780.5 million over its life. 2. Fixed-price contract with economic price adjustment indicates potential for cost fluctuations. 3. Awarded by the Defense Logistics Agency, supporting critical aircraft maintenance. 4. The contract spans nearly 10 years, from September 2006 to July 2014. 5. The North American Industry Classification System (NAICS) code 336413 points to specialized aircraft parts manufacturing. 6. The contractor, Goodrich Corporation, is a significant player in the aerospace and defense sector.

Value Assessment

Rating: good

The total contract value of $780.5 million over its extended period suggests a substantial investment in aircraft landing gear components. While specific performance metrics are not detailed here, the fixed-price with economic price adjustment (FPEPA) structure allows for some cost flexibility, which can be beneficial for long-term supply contracts with fluctuating material costs. Benchmarking this against similar long-term sustainment contracts for major aircraft components would provide a clearer picture of value for money, but the scale of the award indicates a significant need and commitment from the Department of Defense.

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 had the opportunity to submit proposals. The specific number of bidders is not provided, but full and open competition generally fosters a competitive environment that can lead to better pricing and innovation. This approach is favored for ensuring that the government receives the best possible value by considering a wide range of potential suppliers.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down costs through market forces and encourages a broader base of suppliers, potentially leading to more competitive bids and reduced overall expenditure.

Public Impact

The primary beneficiaries are military branches relying on the specified aircraft for operational readiness. The contract ensures the continued availability of critical landing gear components, essential for aircraft safety and functionality. Geographic impact is national, supporting military bases and operations across the United States and potentially overseas. Workforce implications include employment at Goodrich Corporation's facilities and its supply chain partners involved in manufacturing and logistics.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (nearly 10 years) could lead to price escalation risks if not managed carefully.
Economic price adjustment clause requires monitoring to ensure it reflects genuine cost increases and not contractor inefficiencies.
Reliance on a single primary contractor (Goodrich Corporation) for such a critical component could pose supply chain risks if their production is disrupted.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that likely secured favorable terms.
The substantial value indicates a long-term commitment to supporting critical defense assets, ensuring operational readiness.
Goodrich Corporation's established presence in the aerospace sector suggests a high likelihood of technical capability and reliable delivery.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. The market for aircraft components is highly specialized, with a limited number of large, established manufacturers capable of meeting stringent military specifications. Spending in this area is driven by the need for sustainment and modernization of military aviation fleets. Comparable spending benchmarks would involve looking at other long-term sustainment contracts for major aircraft systems or components within the Department of Defense.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. Given the specialized nature of aircraft landing gear components and the large contract value, it is likely that the prime contractor, Goodrich Corporation, would engage a complex supply chain. Opportunities for small businesses may exist within this supply chain, but direct set-aside analysis is not possible from the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA) and the Defense Contract Audit Agency (DCAA), ensuring compliance with contract terms, quality standards, and financial accountability. The Defense Logistics Agency (DLA) Contracting Command would also play a role in contract administration. Transparency is generally maintained through contract award databases, though specific performance details may be sensitive.

Related Government Programs

Aircraft Parts and Auxiliary Equipment Manufacturing
Aerospace and Defense Sustainment Programs
Military Aircraft Maintenance and Repair
Defense Logistics Agency Procurement

Risk Flags

Long-term contract duration
Economic price adjustment clause
Potential for supply chain disruption
Reliance on a single large contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.8 million to GOODRICH CORP. 200612!000716!5700!FA8203!OO-ALC/PKI/LGJL !FA820306C0246 !A!N! !N! ! !20060929!20110430!780459749!780459749!004467452!N!GOODRICH CORPORATION !8000 MARBLE AVE !CLEVELAND !OH!44105!16000!035!39!CLEVELAND !CUYAHOGA !OHIO !+000016007139!N!N!000000000000!1620!AIRCRAFT LANDING GEAR COMPONENTS !A1A!AIRFRAMES AND SPARES !000 !NOT DISCERNABLE !336413!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is GOODRICH CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $15.8 million.

What is the period of performance?

Start: 2006-09-29. End: 2014-07-01.

What is the historical spending trend for aircraft landing gear components by the Department of Defense over the last decade?

Analyzing historical spending trends for aircraft landing gear components requires access to detailed procurement data beyond this single contract. However, generally, defense spending on aircraft sustainment, including components like landing gear, tends to be relatively stable but can fluctuate based on fleet age, operational tempo, and modernization programs. The total value of this contract ($780.5 million) over its nearly 10-year period suggests an average annual spend of approximately $78 million for this specific component category. Broader trends would show whether this represents an increase, decrease, or steady state compared to previous periods and other similar contracts awarded by agencies like the DLA or Air Force.

How does the pricing structure (Fixed Price with Economic Price Adjustment) compare to other similar long-term sustainment contracts for aircraft components?

Fixed Price with Economic Price Adjustment (FPEPA) is a common pricing structure for long-term sustainment contracts where material costs or labor rates are subject to significant fluctuation. Compared to a firm-fixed-price (FFP) contract, FPEPA offers more flexibility to the contractor to adjust prices based on pre-defined economic factors, which can help ensure supply continuity. However, it also introduces more risk for the government if those adjustments are not carefully monitored or if they exceed market trends. Other contracts might use FFP for shorter durations or when cost stability is more predictable, or cost-plus structures for research and development where costs are highly uncertain.

What is Goodrich Corporation's track record in fulfilling large defense contracts, particularly for aircraft components?

Goodrich Corporation (now part of Collins Aerospace, a Raytheon Technologies company) has a long and established history of supplying critical components, including landing gear systems, to the aerospace and defense industry. They have consistently been a major contractor for various U.S. military aircraft platforms. Their track record generally includes successful delivery of complex systems, adherence to stringent quality standards, and managing large-scale production. While specific performance details for every contract are not publicly available, their sustained presence and the continued awarding of significant contracts like this one suggest a strong capability and reliability in meeting defense requirements.

What are the potential risks associated with a nearly 10-year contract duration for aircraft landing gear components?

A contract duration of nearly 10 years for aircraft landing gear components presents several potential risks. Firstly, technological obsolescence: aircraft designs and associated component requirements can evolve, potentially making the contracted components outdated before the contract ends. Secondly, price volatility: over such a long period, economic factors (inflation, raw material costs, labor) can significantly impact the cost of production, and the economic price adjustment clause needs careful management to prevent excessive price increases. Thirdly, contractor viability: the long duration increases the risk of the contractor facing financial difficulties, supply chain disruptions, or changes in business strategy that could impact delivery. Lastly, maintaining competitive pricing over an extended period can be challenging.

How does the NAICS code 336413 (Other Aircraft Parts and Auxiliary Equipment Manufacturing) typically relate to the overall defense aerospace supply chain?

The NAICS code 336413 encompasses establishments primarily engaged in manufacturing aircraft parts and auxiliary equipment, not elsewhere classified. This includes components like landing gear, engine parts, avionics, and other specialized systems. Within the defense aerospace supply chain, companies under this code are crucial Tier 1 or Tier 2 suppliers, providing essential building blocks for aircraft manufacturers (like Boeing or Lockheed Martin) or directly to government agencies for sustainment. They often operate under strict quality certifications (e.g., AS9100) and must meet rigorous military specifications, playing a vital role in ensuring the airworthiness and operational readiness of military aircraft.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 8000 MARBLE AVE, CLEVELAND, OH, 90

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

Contract Characteristics

Cost or Pricing Data: YES

Timeline