DoD Awards Boeing $286M for C-17 Globemaster III Sustainment Through 2026
Contract Overview
Contract Amount: $286,492,471 ($286.5M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2025-11-01
End Date: 2026-10-31
Contract Duration: 364 days
Daily Burn Rate: $787.1K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: C-17 GLOBEMASTER III (G3) SUSTAINMENT
Place of Performance
Location: SAN ANTONIO, BEXAR County, TEXAS, 78226
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $286.5 million to THE BOEING COMPANY for work described as: C-17 GLOBEMASTER III (G3) SUSTAINMENT Key points: 1. Significant contract value for sustainment of a critical military asset. 2. Sole reliance on Boeing raises concerns about competitive pricing and innovation. 3. Potential for cost overruns due to Cost Plus Incentive Fee structure. 4. Sustainment spending in aircraft manufacturing is a substantial sector.
Value Assessment
Rating: questionable
The contract's Cost Plus Incentive Fee structure, while aiming for efficiency, can lead to higher costs if not tightly managed. Benchmarking against similar sustainment contracts for large aircraft is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was sole-sourced, limiting competition and potentially impacting price discovery. The lack of competitive bidding means the government relies heavily on Boeing's proposed pricing and cost controls.
Taxpayer Impact: The absence of competition may result in taxpayers paying a premium for sustainment services that could potentially be procured at a lower cost through a competitive process.
Public Impact
Ensures continued operational readiness of the C-17 fleet, vital for global logistics and troop transport. Supports a key defense contractor, impacting jobs and the aerospace industrial base. Long-term sustainment needs for major weapon systems represent a significant portion of the defense budget.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition.
- Cost Plus Incentive Fee structure can inflate costs.
- Lack of transparency in pricing.
- Long-term reliance on a single provider.
Positive Signals
- Ensures critical aircraft sustainment.
- Supports operational readiness.
- Potential for performance incentives.
Sector Analysis
The aerospace and defense sector, particularly aircraft manufacturing and sustainment, involves high-value, complex contracts. Benchmarks for sustainment can vary widely based on aircraft type, age, and operational tempo.
Small Business Impact
This contract is awarded to a large prime contractor, The Boeing Company. There is no explicit information provided regarding subcontracting opportunities for small businesses within this award.
Oversight & Accountability
Oversight will be critical to ensure Boeing meets performance requirements and manages costs effectively under the incentive fee structure. Regular audits and performance reviews are essential for accountability.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award
- Cost Plus Incentive Fee contract type
- Lack of competition
- Potential for cost overruns
- Long-term sustainment dependency
Tags
aircraft-manufacturing, department-of-defense, tx, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $286.5 million to THE BOEING COMPANY. C-17 GLOBEMASTER III (G3) SUSTAINMENT
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 $286.5 million.
What is the period of performance?
Start: 2025-11-01. End: 2026-10-31.
What is the projected cost savings or efficiency gain anticipated from the incentive fee structure in this contract?
The specific projected savings or efficiency gains from the incentive fee structure are not detailed in the provided data. Cost Plus Incentive Fee contracts aim to incentivize the contractor to control costs by sharing savings or cost overruns. The effectiveness depends on the baseline cost estimates and the agreed-upon sharing formula.
What are the risks associated with relying solely on Boeing for C-17 sustainment over the contract period?
Sole-source reliance on Boeing for C-17 sustainment carries risks such as potential price escalation without competitive pressure, limited flexibility in adopting new sustainment technologies, and dependence on a single supplier's production capacity and strategic decisions.
How does the sustainment cost per flight hour for the C-17 compare to similar large military transport aircraft?
Direct comparison of sustainment cost per flight hour for the C-17 against similar aircraft is challenging without access to proprietary data and specific operational contexts. Factors like fleet size, age, mission profile, and maintenance philosophy significantly influence these costs.
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
Pricing Type: COST PLUS INCENTIVE FEE (V)
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: $772,252,405
Exercised Options: $772,252,405
Current Obligation: $286,492,471
Subaward Activity
Number of Subawards: 119
Total Subaward Amount: $24,882,881
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: 2025-11-01
Current End Date: 2026-10-31
Potential End Date: 2026-10-31 00:00:00
Last Modified: 2026-03-26
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