Boeing awarded $92.8M for C-17 landing gear, with contract performance extending to 2027

Contract Overview

Contract Amount: $92,863,832 ($92.9M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2022-11-15

End Date: 2027-11-30

Contract Duration: 1,841 days

Daily Burn Rate: $50.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: C-17 LANDING GEAR

Place of Performance

Location: LONG BEACH, LOS ANGELES County, CALIFORNIA, 90808

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $92.9 million to THE BOEING COMPANY for work described as: C-17 LANDING GEAR Key points: 1. Contract awarded for critical aircraft components, indicating ongoing need for fleet maintenance. 2. Sole-source award suggests limited market options or specific technical requirements. 3. Long performance period may introduce risks related to cost escalation and technological obsolescence. 4. Firm fixed-price contract shifts some cost risk to the contractor. 5. Contracting agency is the Department of the Air Force, a major user of C-17 aircraft. 6. Geographic location of performance is California, a hub for aerospace manufacturing.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the landing gear components and their complexity. However, a $92.8 million award for a critical aircraft system over nearly five years suggests a significant investment. The firm fixed-price nature provides some cost certainty, but the absence of competition raises questions about whether the best possible price was achieved. Further analysis would require comparing this award to similar sustainment contracts for large military aircraft.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning the Department of the Air Force did not solicit bids from multiple potential suppliers. This approach is typically used when only one responsible source is available or when there is a compelling justification for not seeking competition, such as unique technical capabilities or urgent needs. The lack of competition limits price discovery and may result in higher costs for the government.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive bidding, as the government did not benefit from the price pressures that typically arise in an open market.

Public Impact

The primary beneficiaries are the U.S. Air Force and its C-17 Globemaster III fleet, ensuring operational readiness. Services delivered include the manufacturing and supply of landing gear systems, crucial for aircraft safety and functionality. Geographic impact is primarily within the United States, with performance centered in California. Workforce implications include employment within The Boeing Company's aerospace manufacturing sector in California.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially leading to higher costs.
Long contract duration (over 4 years) increases exposure to economic fluctuations and potential cost overruns.
Reliance on a single supplier for critical components can create supply chain vulnerabilities.
Lack of transparency in the sole-source justification requires careful review.
Potential for scope creep or change orders over the extended performance period.

Positive Signals

Firm fixed-price contract structure shifts some financial risk to the contractor.
Award to a major defense contractor like Boeing suggests established capabilities and experience.
Contract supports the sustainment of a vital strategic airlift capability for the U.S. Air Force.
Long-term award provides stability for the contractor and ensures supply continuity for the Air Force.

Sector Analysis

The aerospace manufacturing sector is characterized by high barriers to entry, complex supply chains, and significant R&D investment. This contract falls within the defense sub-sector, specifically focusing on aircraft components. The C-17 Globemaster III is a critical strategic airlift aircraft, and its sustainment is a priority for the Department of Defense. Spending on aircraft parts and maintenance is substantial across the federal government, with major contractors like Boeing playing a dominant role.

Small Business Impact

This contract does not appear to include a small business set-aside. Given the sole-source nature and the prime contractor being The Boeing Company, it is unlikely that significant subcontracting opportunities for small businesses are mandated within this specific award. However, Boeing's broader subcontracting policies and existing relationships with small businesses in the aerospace supply chain would determine the overall impact.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. The Defense Contract Management Agency (DCMA) likely plays a role in monitoring performance and compliance. Transparency is limited due to the sole-source nature, but contract awards are generally reported in federal procurement databases. Inspector General investigations could be initiated if performance issues or allegations of impropriety arise.

Related Government Programs

C-17 Globemaster III Sustainment
Aircraft Parts and Auxiliary Equipment
Defense Logistics Agency (DLA) Procurement
Air Force Materiel Command Contracts

Risk Flags

Sole-source award limits competition.
Long contract duration increases risk exposure.
Potential for supply chain disruptions.
Lack of detailed performance metrics in summary data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $92.9 million to THE BOEING COMPANY. C-17 LANDING GEAR

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 $92.9 million.

What is the period of performance?

Start: 2022-11-15. End: 2027-11-30.

What is the specific type and complexity of the landing gear system being procured under this contract?

The provided data does not specify the exact components of the C-17 landing gear system. However, landing gear for large military transport aircraft like the C-17 is a highly complex and critical system. It involves robust structural components, hydraulic actuation systems, braking mechanisms, and potentially electronic control units. The complexity dictates the manufacturing precision, material science requirements, and rigorous testing protocols necessary. Without detailed specifications, it's difficult to precisely benchmark the value or identify specific risks beyond general sustainment concerns.

What was the justification for awarding this contract on a sole-source basis?

The data indicates the contract was 'NOT COMPETED,' implying a sole-source or limited competition award. Common justifications for sole-source awards in defense contracting include the unique capabilities of a specific contractor (e.g., the original equipment manufacturer), the need for compatibility with existing systems, urgent and compelling requirements where competition is impractical, or when only one responsible source exists. For a critical component like landing gear on an established platform like the C-17, Boeing, as the original manufacturer, is often the most likely sole-source provider due to proprietary designs, tooling, and technical data.

How does the $92.8 million award compare to historical spending on C-17 landing gear or similar components?

The provided data offers a single award value of $92.8 million for C-17 landing gear with a performance period from November 2022 to November 2027 (1841 days). To compare this to historical spending, one would need access to historical contract databases to identify previous awards for C-17 landing gear, whether for new production, spare parts, or sustainment. Factors like inflation, quantity of units, and specific component types would need to be normalized for a meaningful comparison. Without this historical context, it's challenging to determine if this award represents an increase, decrease, or stable spending trend.

What are the key performance indicators (KPIs) and deliverables expected under this contract?

The provided data does not detail the specific Key Performance Indicators (KPIs) or deliverables for this contract. Typically, for aircraft component sustainment contracts, KPIs would focus on factors such as on-time delivery rates for parts, defect rates, lead times for repairs or replacements, and adherence to technical specifications. Deliverables would likely include the physical landing gear components (new or overhauled), associated technical documentation, test reports, and potentially maintenance support services. The firm fixed-price nature suggests that meeting these defined deliverables within the agreed price is paramount.

What is The Boeing Company's track record with the Department of Defense, particularly concerning aircraft component manufacturing and sustainment?

The Boeing Company has a long and extensive track record as a primary contractor for the Department of Defense, manufacturing a wide array of military aircraft, including the C-17 Globemaster III. They are a major player in aircraft sustainment and logistics support. While generally considered a reliable supplier, like any large defense contractor, Boeing has faced scrutiny and challenges on various contracts related to cost overruns, production delays, and quality control issues across different programs. Their overall performance with the DoD is substantial, encompassing billions of dollars in contracts annually, with a history of both successes and areas requiring improvement.

Are there any identified risks associated with the long performance period (2022-2027) for this landing gear contract?

Yes, the extended performance period of nearly five years presents several risks. Firstly, economic inflation could erode the value of the fixed price over time, although the contract is fixed price. More significantly, the extended duration increases the risk of obsolescence if newer, more advanced landing gear technologies emerge or if C-17 operational requirements change. Supply chain disruptions, material cost volatility, and the potential for unforeseen technical issues or wear-and-tear on components over such a long period also pose risks. Furthermore, the contractor's workforce stability and institutional knowledge retention over five years can be a factor.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: FA852621R0002

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4060 N LAKEWOOD BLVD, LONG BEACH, CA, 90808

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: $92,863,832

Exercised Options: $92,863,832

Current Obligation: $92,863,832

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $164,219

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA852621D0001

IDV Type: IDC

Timeline