DoD awards $50.5M to Boeing for C-17 RHUD Kit sustainment, impacting USAF and FMS aircraft

Contract Overview

Contract Amount: $50,500,476 ($50.5M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2024-12-19

End Date: 2028-02-28

Contract Duration: 1,166 days

Daily Burn Rate: $43.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: THE CONTRACTOR SHALL PROCURE AND DELIVER RHUD KIT MATERIAL AND SPARES TO RETROFIT AND SUSTAIN C-17 UNITED STATES AIR FORCE (USAF) AND FOREIGN MILITARY SALES (FMS)AIRCRAFT.

Place of Performance

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

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $50.5 million to THE BOEING COMPANY for work described as: THE CONTRACTOR SHALL PROCURE AND DELIVER RHUD KIT MATERIAL AND SPARES TO RETROFIT AND SUSTAIN C-17 UNITED STATES AIR FORCE (USAF) AND FOREIGN MILITARY SALES (FMS)AIRCRAFT. Key points: 1. Contract focuses on sustainment and retrofitting of critical C-17 aircraft components. 2. Sole-source award to Boeing, the original manufacturer, raises questions about competition. 3. Long-term contract (2028 end date) suggests ongoing need for these specialized parts. 4. Spending is within the Aircraft Manufacturing sector, dominated by large prime contractors.

Value Assessment

Rating: fair

The contract value of $50.5M for RHUD Kit material and spares appears reasonable given the specialized nature of C-17 sustainment. However, without detailed cost breakdowns or benchmarks for similar sustainment contracts, a precise value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award to The Boeing Company. This limits price discovery and potentially leads to higher costs compared to a competitive bidding process.

Taxpayer Impact: Taxpayer funds are used for this sole-source award, potentially at a premium due to the lack of competition.

Public Impact

Ensures continued operational readiness for C-17 aircraft, vital for global logistics and troop transport. Supports both U.S. Air Force and allied nations operating C-17s through Foreign Military Sales. Potential for increased costs to taxpayers due to the sole-source nature of the award. Sustains critical infrastructure within the aerospace manufacturing sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
Long-term contract duration may not reflect evolving technological needs.
Lack of transparency in cost build-up for sole-source contracts.

Positive Signals

Ensures critical sustainment for essential C-17 aircraft.
Supports a key defense contractor, maintaining domestic aerospace capabilities.
Addresses the needs of both USAF and FMS partners.

Sector Analysis

This contract falls within the Aircraft Manufacturing sector, specifically supporting the sustainment of a major military transport aircraft. Spending benchmarks in this sector are often high due to complex engineering and long lifecycles.

Small Business Impact

This contract was awarded to The Boeing Company, a large prime contractor. There is no indication of subcontracting opportunities for small businesses within the provided data.

Oversight & Accountability

The Department of the Air Force, under the Department of Defense, is the awarding agency. Oversight will be crucial to ensure fair pricing and performance, especially given the sole-source nature of the award.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Sole-source award limits competition.
Potential for cost overruns due to lack of competitive bidding.
Dependency on a single contractor for critical aircraft parts.
Long contract duration may not adapt to future technological advancements.
Lack of transparency in pricing for sole-source agreements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $50.5 million to THE BOEING COMPANY. THE CONTRACTOR SHALL PROCURE AND DELIVER RHUD KIT MATERIAL AND SPARES TO RETROFIT AND SUSTAIN C-17 UNITED STATES AIR FORCE (USAF) AND FOREIGN MILITARY SALES (FMS)AIRCRAFT.

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 $50.5 million.

What is the period of performance?

Start: 2024-12-19. End: 2028-02-28.

What is the justification for the sole-source award to Boeing, and were alternative solutions considered?

The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or the need for compatibility with existing systems. For the C-17 RHUD Kit, Boeing, as the original manufacturer, likely possesses the sole rights to the design, tooling, and necessary technical data. While alternatives might be explored, the specialized nature of aircraft sustainment often favors the original equipment manufacturer to ensure airworthiness and performance standards are met without compromising safety.

How does the per-unit cost of these RHUD Kit materials and spares compare to industry benchmarks or previous contracts?

Without access to specific cost breakdowns or historical pricing data for the C-17 RHUD Kit, a direct per-unit cost comparison is not feasible. However, sole-source contracts inherently lack the competitive pressure that drives down prices. Therefore, it is plausible that the per-unit cost may be higher than if the contract had been competed. Further analysis would require access to Boeing's cost proposals and potentially data from similar sustainment efforts on other aircraft platforms.

What is the long-term strategy for C-17 sustainment, and does this contract align with future modernization plans?

This contract addresses the immediate need for RHUD Kit material and spares through February 2028. The long-term strategy for C-17 sustainment would involve ongoing maintenance, potential upgrades, and eventual replacement planning. This contract appears to be a component of that broader strategy, ensuring current operational capability. Alignment with future modernization would depend on whether the RHUD Kit itself is slated for upgrades or if newer technologies could supersede its function.

Industry Classification

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

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

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: $51,326,843

Exercised Options: $50,500,476

Current Obligation: $50,500,476

Subaward Activity

Number of Subawards: 24

Total Subaward Amount: $43,031,160

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