Air Force awards $69.2M contract to Boeing for telescope actuator redesign, signaling significant investment in aerospace technology

Contract Overview

Contract Amount: $69,198,190 ($69.2M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2023-11-30

End Date: 2028-08-31

Contract Duration: 1,736 days

Daily Burn Rate: $39.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: BOOM TELESCOPE ACTUATOR REDESIGN KIT PROCUREMNET INSTALL

Place of Performance

Location: TUKWILA, KING County, WASHINGTON, 98108

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $69.2 million to THE BOEING COMPANY for work described as: BOOM TELESCOPE ACTUATOR REDESIGN KIT PROCUREMNET INSTALL Key points: 1. Contract value represents a substantial investment in specialized aerospace components. 2. Sole-source award to Boeing suggests unique capabilities or existing platform integration. 3. Long performance period indicates a complex, multi-year project. 4. Firm-fixed-price structure aims to control costs for the government. 5. Focus on aircraft manufacturing highlights the contract's role in supporting aviation readiness. 6. The award falls within a broad category of aircraft component procurement.

Value Assessment

Rating: fair

The contract value of $69.2 million for a telescope actuator redesign kit is significant. Without specific benchmarks for this particular component or similar redesign efforts, a direct value-for-money assessment is challenging. However, the long performance period (over 4 years) suggests a complex undertaking. The firm-fixed-price nature of the contract provides cost certainty, which is a positive indicator for the government. Further analysis would require comparing this cost to similar advanced component redesigns or the cost of developing a new system versus redesigning an existing one.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, The Boeing Company, was considered. This typically occurs when a contractor possesses unique capabilities, proprietary technology, or when the item is a sole-source component of a larger system. The lack of competition means the government did not benefit from price discovery through multiple bids, potentially leading to a higher price than if it had been competed.

Taxpayer Impact: A sole-source award limits opportunities for other businesses to compete for this work and may result in less favorable pricing for taxpayers compared to a competitive procurement.

Public Impact

The primary beneficiary is the Department of the Air Force, which will receive an updated and potentially more reliable telescope actuator system. The services delivered involve the redesign, procurement, and installation of critical aerospace components. The geographic impact is primarily within the United States, likely at Air Force facilities where the telescope systems are deployed or maintained. Workforce implications include specialized engineers, technicians, and manufacturing personnel within The Boeing Company.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and potential cost savings.
Long contract duration increases exposure to potential cost overruns or scope creep if not managed tightly.
Reliance on a single contractor for critical component redesign may pose supply chain risks.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to a major aerospace contractor like Boeing suggests access to established expertise and quality.
Redesign effort implies a focus on improving existing technology and potentially enhancing system performance.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aircraft manufacturing and related components. The market for specialized aerospace components, such as telescope actuators, is often characterized by high barriers to entry due to technological complexity and stringent quality requirements. Spending in this area is driven by the need for advanced capabilities in surveillance, targeting, and scientific observation. Comparable spending benchmarks would typically involve other large-scale aerospace system development or upgrade contracts.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses indicated in the provided data. The award to a large prime contractor like The Boeing Company suggests that the bulk of the work will be performed by the prime or its large subcontractors. This limits direct opportunities for small businesses to participate in this specific contract, although Boeing may engage small businesses in its broader supply chain.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Air Force contracting and program management offices. Accountability measures would include performance reviews, milestone tracking, and adherence to the firm-fixed-price agreement. Transparency is generally maintained through contract award databases, though specific details of the redesign process may be proprietary. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aircraft Component Procurement
Aerospace Systems Development
Department of Defense Research and Development
Air Force Sustainment Programs
Optical and Electro-Optical Equipment Manufacturing

Risk Flags

Sole Source Award
Long Performance Period
Potential for Technical Complexity

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $69.2 million to THE BOEING COMPANY. BOOM TELESCOPE ACTUATOR REDESIGN KIT PROCUREMNET INSTALL

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 $69.2 million.

What is the period of performance?

Start: 2023-11-30. End: 2028-08-31.

What is the specific function of the telescope actuator being redesigned, and why is a redesign necessary?

The provided data does not specify the exact function of the telescope actuator or the precise reasons for its redesign. However, telescope actuators are critical components responsible for the precise movement and positioning of telescope mirrors or other optical elements. A redesign is typically necessitated by obsolescence of existing parts, a need for improved performance (e.g., greater accuracy, speed, or stability), enhanced reliability, reduced maintenance, or integration with new systems. The "BOOM TELESCOPE ACTUATOR REDESIGN KIT PROCUREMNET INSTALL" description suggests a focus on a specific type of telescope system, possibly related to aerospace or defense applications, and implies a need for updated or improved operational capabilities.

How does the $69.2 million contract value compare to historical spending on similar telescope actuator systems or redesign efforts by the Air Force?

The provided data does not include historical spending figures for similar telescope actuator systems or redesign efforts, making a direct comparison difficult. However, $69.2 million is a substantial sum for a component redesign and installation, suggesting either a highly complex system, a significant upgrade, or a large quantity of units. To benchmark this value, one would need to research past contracts for advanced optical system components, telescope maintenance, or similar aerospace hardware redesigns within the Department of Defense. The long performance period (over four years) also contributes to the overall contract value, indicating a multi-year effort rather than a short-term procurement.

What are the key performance indicators (KPIs) or milestones associated with this contract, and how will Boeing's performance be measured?

The provided data does not detail the specific Key Performance Indicators (KPIs) or milestones for this contract. Typically, for a redesign and installation contract of this nature, performance would be measured against criteria such as adherence to the technical specifications of the redesigned actuator, successful integration and testing of the new components, delivery timelines, and overall system performance improvements post-installation. The firm-fixed-price nature suggests that meeting these defined requirements within the agreed budget is paramount. The Air Force's program management office would establish and monitor these KPIs, likely involving technical reviews, acceptance testing, and progress reports from Boeing.

Given the sole-source nature, what steps has the Air Force taken to ensure fair and reasonable pricing for this telescope actuator redesign?

While the data indicates a sole-source award, the Air Force is still obligated to ensure fair and reasonable pricing. Steps typically taken include conducting a thorough price analysis, which might involve reviewing Boeing's cost proposals, comparing proposed labor rates and material costs to historical data or industry standards, and potentially negotiating profit margins. If the item is unique, the government might request data from the contractor on their non-recurring engineering costs, production costs, and overhead. In some sole-source situations, the government may also seek independent cost estimates or consult with technical experts to validate the reasonableness of the proposed price.

What is Boeing's track record with the Department of the Air Force, particularly in aerospace component manufacturing and redesign projects?

The Boeing Company is a major defense contractor with an extensive and long-standing relationship with the Department of the Air Force, involved in numerous aircraft manufacturing, development, and sustainment programs. Their track record includes delivering complex systems and components across various platforms. While specific details on past telescope actuator redesigns are not provided, Boeing's overall experience in aerospace engineering, systems integration, and large-scale manufacturing suggests a strong capability to undertake such a project. Their history with the Air Force generally indicates a capacity for meeting stringent technical requirements and delivery schedules, though like any large contractor, specific project performance can vary.

Are there any identified risks associated with this contract, such as technical challenges, schedule delays, or cost overruns, beyond the general risks of a sole-source award?

Beyond the inherent risks of a sole-source award (potential for higher pricing and limited innovation), specific risks for this contract could include technical challenges in the redesign process itself, especially if dealing with complex optical or mechanical systems. Schedule delays are possible due to the long performance period and the intricate nature of aerospace development. Cost overruns are less likely to impact the government directly due to the firm-fixed-price structure, but they could affect Boeing's profitability and potentially influence future pricing. The successful installation and integration of the redesigned kit into existing systems also present a risk, requiring careful planning and execution to ensure compatibility and functionality.

Industry Classification

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

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 7755 E MARGINAL WAY S, SEATTLE, WA, 98108

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: $69,198,190

Exercised Options: $69,198,190

Current Obligation: $69,198,190

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $51,166,393

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA860919D0007

IDV Type: IDC

Timeline