Boeing Awarded $23.8M for CATE M9-DI Conversion by Air Force, No Competition
Contract Overview
Contract Amount: $23,847,849 ($23.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2024-09-26
End Date: 2027-01-29
Contract Duration: 855 days
Daily Burn Rate: $27.9K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: CATE M9-DI CONVERSION
Place of Performance
Location: LONG BEACH, LOS ANGELES County, CALIFORNIA, 90808
Plain-Language Summary
Department of Defense obligated $23.8 million to THE BOEING COMPANY for work described as: CATE M9-DI CONVERSION Key points: 1. Significant contract value of $23.8 million awarded to a single large business. 2. Lack of competition raises concerns about potential overpricing and limited innovation. 3. Contract duration of 855 days suggests a substantial project timeline. 4. Focus on Aircraft Manufacturing within the Defense sector.
Value Assessment
Rating: questionable
The contract value of $23.8 million for aircraft conversion is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar services from other qualified manufacturers.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for the government as there is no market pressure to offer the best price.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for this aircraft conversion service.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. Potential for reduced innovation as the contractor faces no pressure to improve services. The Air Force's reliance on a single source could impact future procurement strategies. This award highlights a specific need within the Department of Defense for aircraft modification.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- No small business participation indicated
Positive Signals
- Clear contract award for a specific defense need
- Firm fixed price contract type can provide cost certainty
Sector Analysis
This contract falls within the Aircraft Manufacturing sector, a critical component of the Defense industry. Spending in this area is often characterized by high R&D costs, long production cycles, and significant government oversight due to national security implications.
Small Business Impact
There is no indication of small business participation in this contract. The award to a large prime contractor like Boeing suggests that subcontracting opportunities for small businesses may be limited or not explicitly detailed in this award notice.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the price is fair and reasonable and that the contractor meets all performance requirements within the specified timeline.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award lacks competitive pricing pressure.
- Potential for overpayment due to lack of competition.
- No clear indication of small business subcontracting.
- High contract value requires robust oversight.
- Long contract duration may present performance risks.
Tags
aircraft-manufacturing, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $23.8 million to THE BOEING COMPANY. CATE M9-DI CONVERSION
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 $23.8 million.
What is the period of performance?
Start: 2024-09-26. End: 2027-01-29.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award is crucial for understanding why competition was bypassed. Typically, this is due to unique capabilities, urgent needs, or specific government requirements that only one contractor can fulfill. Without this justification, the lack of competition raises significant value concerns.
How does the $23.8 million price compare to industry benchmarks for similar aircraft conversion projects?
Benchmarking this contract's price against similar aircraft conversion projects is essential for assessing value. Given the sole-source nature, a thorough independent cost analysis would be necessary to confirm if the $23.8 million is a fair and reasonable price, especially considering the 855-day duration.
What are the potential risks associated with a sole-source award for critical aircraft modifications?
Sole-source awards carry risks such as inflated pricing, reduced incentive for innovation, and potential vendor lock-in. For critical aircraft modifications, there's also a risk of dependency on a single supplier for future upgrades or maintenance, potentially impacting long-term operational readiness and cost-effectiveness.
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: FA852624R0016
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: $29,547,030
Exercised Options: $29,547,030
Current Obligation: $23,847,849
Subaward Activity
Number of Subawards: 2
Total Subaward Amount: $3,728,738
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
Start Date: 2024-09-26
Current End Date: 2027-01-29
Potential End Date: 2027-01-29 00:00:00
Last Modified: 2025-09-23
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