DoD awards $5.96M for F-16 avionics repair, raising questions on competition and value

Contract Overview

Contract Amount: $5,962,602 ($6.0M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2025-11-19

End Date: 2027-11-23

Contract Duration: 734 days

Daily Burn Rate: $8.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: REPAIR OF THE F-16 AVIONICS INTERMEDIATE SHOP (AIS) FAMILY OF TEST STATIONS REPAIRABLE END ITEMS

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92127

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $6.0 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: REPAIR OF THE F-16 AVIONICS INTERMEDIATE SHOP (AIS) FAMILY OF TEST STATIONS REPAIRABLE END ITEMS Key points: 1. Contract awarded to BAE Systems for F-16 avionics repair services. 2. Significant portion of contract value allocated to repairable end items. 3. Limited competition raises concerns about potential overpricing and reduced value. 4. Contract duration extends over two years, indicating ongoing support needs. 5. Geographic focus on California for repair services. 6. High-level industry code suggests specialized electronic equipment repair.

Value Assessment

Rating: questionable

The contract value of $5.96 million for F-16 avionics repair appears to be a significant investment. Without specific per-unit cost data or benchmarks for similar repair services, it is difficult to definitively assess value for money. The lack of competition, as indicated by the 'NOT COMPETED' status, further complicates a robust value assessment, as it limits the ability to compare pricing against market alternatives. The contract's focus on repairable end items suggests a need for specialized, potentially costly, maintenance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities, technology, or proprietary knowledge to fulfill the requirement. The lack of competition means that the Department of the Air Force did not benefit from a bidding process that could have driven down prices and potentially identified more cost-effective solutions. This raises concerns about whether the government obtained the best possible price and value.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. Without alternative offers, there is less assurance that the awarded price reflects true market value, potentially leading to less efficient use of public funds.

Public Impact

The U.S. Air Force benefits from the continued operational readiness of its F-16 fighter jet fleet. Specialized repair services for avionics intermediate shop (AIS) test stations are delivered. Services are primarily concentrated in California, supporting regional Air Force installations. The contract supports a specialized technical workforce skilled in avionics repair.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Lack of transparency in the justification for sole-source award.
Potential for vendor lock-in due to specialized nature of F-16 avionics repair.
Contract duration may not align with evolving technology or future fleet needs.

Positive Signals

Ensures continued operational readiness of critical F-16 aircraft.
Leverages specialized expertise of BAE Systems in avionics repair.
Provides necessary support for a key component of Air Force's combat capability.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on the maintenance and repair of complex electronic systems for military aircraft. The market for military avionics repair is often characterized by high barriers to entry due to specialized knowledge, certifications, and proprietary technology. Spending in this area is critical for maintaining the operational readiness of aging but still vital aircraft platforms like the F-16. Comparable spending benchmarks would typically involve other contracts for similar repair services on military aircraft systems, often awarded through competitive processes.

Small Business Impact

The contract details do not indicate any specific small business set-aside provisions or subcontracting requirements. Given the specialized nature of F-16 avionics repair and the sole-source award to a large defense contractor, it is unlikely that small businesses will be directly involved as prime contractors. There may be opportunities for small businesses to subcontract to BAE Systems, but this is not explicitly stated in the provided data. The overall impact on the small business ecosystem for this specific contract appears minimal.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. Accountability measures would include performance monitoring against contract requirements and delivery schedules. Transparency is limited due to the sole-source nature of the award, with justifications for this approach typically being internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

F-16 Aircraft Sustainment Programs
Avionics Systems Maintenance Contracts
Defense Logistics Agency Repair Services
Air Combat Command Readiness Initiatives

Risk Flags

Sole-source award raises concerns about fair pricing and competition.
Potential for increased costs due to lack of competitive bidding.
Dependence on a single contractor could impact long-term availability and pricing.
Limited transparency regarding the justification for sole-source procurement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $6.0 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. REPAIR OF THE F-16 AVIONICS INTERMEDIATE SHOP (AIS) FAMILY OF TEST STATIONS REPAIRABLE END ITEMS

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC..

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 $6.0 million.

What is the period of performance?

Start: 2025-11-19. End: 2027-11-23.

What is the specific justification provided by the Department of the Air Force for awarding this contract on a sole-source basis to BAE Systems?

The provided data indicates the contract was 'NOT COMPETED,' which typically implies a sole-source award. The specific justification would likely stem from BAE Systems possessing unique capabilities, proprietary technology, or essential knowledge related to the F-16 avionics intermediate shop (AIS) family of test stations that no other vendor can replicate. This could include specific technical data, specialized tooling, or existing integration with the F-16 platform. Without access to the official justification document (e.g., a Justification and Approval for Other Than Full and Open Competition), the precise reasoning remains speculative but generally falls into categories of technical necessity, urgency, or lack of viable alternatives.

How does the awarded amount of $5.96 million compare to historical spending on similar F-16 avionics repair services?

Direct comparison to historical spending on similar F-16 avionics repair services is challenging without access to a broader dataset of past contracts. However, the contract value of approximately $5.96 million over a period of roughly two years (ending November 2027) suggests a substantial, ongoing requirement. If previous repair efforts were also sole-sourced or involved similar scope, the current value might be in line. Conversely, if past repairs were competed and resulted in lower costs, this award could indicate an increase in pricing or scope. Analyzing trends in repair costs for specific avionics components and comparing the number of repairable end items versus the total contract value would provide further context.

What are the key performance indicators (KPIs) used to measure the success and effectiveness of this repair contract?

Key performance indicators for this contract would likely focus on ensuring the operational readiness and reliability of the F-16 fleet. Specific KPIs could include: turnaround time for repairs (measured in days or hours from receipt to return), quality of repairs (measured by defect rates or repeat failures within a specified period), adherence to delivery schedules, and compliance with technical specifications and standards. The contract type, 'FIRM FIXED PRICE,' incentivizes the contractor to meet these performance standards within the agreed budget. Performance would be monitored by the Air Force's program management and quality assurance personnel.

What is the potential risk associated with relying on a single contractor, BAE Systems, for the repair of critical F-16 avionics components?

The primary risk associated with relying on a single contractor for critical F-16 avionics components is the potential for reduced leverage in price negotiations and a lack of incentive for innovation or efficiency improvements, often termed 'vendor lock-in.' If BAE Systems is the sole provider of these specialized repair services, the Air Force has limited options if costs increase significantly or if service quality declines. Furthermore, disruptions to BAE Systems' operations (e.g., labor disputes, supply chain issues, or financial instability) could directly impact the availability and readiness of F-16 aircraft, posing a significant operational risk to national security.

Are there any provisions within the contract that allow for the government to gain access to the technical data or repair processes used by BAE Systems?

The provided contract data does not specify whether the government has rights to the technical data or repair processes. In sole-source contracts, especially those involving proprietary technology, the government may not automatically acquire extensive rights to the contractor's intellectual property or detailed repair methodologies. However, standard government contracting clauses often include provisions for technical data rights, particularly for technical data necessary for operation, maintenance, and overhaul. The extent of these rights would depend on the specific contract clauses and any negotiations that occurred during the award process. Without reviewing the full contract, it's uncertain if the government can independently replicate or utilize these repair processes.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Electronic and Precision Equipment Repair and Maintenance

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: Compagnie DE Developpement DE L'eau S.A.

Address: 10920 TECHNOLOGY PL, SAN DIEGO, CA, 92127

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: $5,962,602

Exercised Options: $5,962,602

Current Obligation: $5,962,602

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA825125D0002

IDV Type: IDC

Timeline