DoD awards Boeing $261M for Aircraft Manufacturing, a sole-source contract
Contract Overview
Contract Amount: $261,220,072 ($261.2M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2004-09-18
End Date: 2012-10-31
Contract Duration: 2,965 days
Daily Burn Rate: $88.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $261.2 million to THE BOEING COMPANY for work described as: Key points: 1. Significant award to a major defense contractor. 2. Sole-source nature raises questions about price discovery. 3. Long contract duration may indicate complex requirements. 4. Focus on aircraft manufacturing aligns with defense needs.
Value Assessment
Rating: questionable
The contract value of $261M over 8 years is substantial. Without competitive bidding, it's difficult to assess if this represents fair market value compared to similar aircraft manufacturing contracts.
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 taxpayers as there was no competitive pressure.
Taxpayer Impact: The lack of competition for this large contract may result in taxpayers paying a premium for aircraft manufacturing services.
Public Impact
Taxpayers may be overpaying due to the absence of competition. The long-term nature of the contract could lock in costs. Dependence on a single contractor for critical aircraft manufacturing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High contract value
- Long duration
Positive Signals
- Supports critical defense capability
- Award to established prime contractor
Sector Analysis
This contract falls within the Defense sector, specifically aircraft manufacturing. Spending benchmarks in this area are highly variable based on aircraft type and complexity, but large sole-source awards warrant scrutiny.
Small Business Impact
The data indicates this contract was not awarded to small businesses. Further analysis would be needed to determine if subcontracting opportunities were provided to small businesses.
Oversight & Accountability
The sole-source nature of this contract suggests a potential lack of robust oversight in the initial procurement phase. Ongoing oversight would be critical to manage costs and performance.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for overpricing due to sole-source award.
- Lack of transparency in the procurement process.
- Long-term commitment may not reflect evolving needs.
- Risk of contractor performance issues without competitive pressure.
Tags
aircraft-manufacturing, department-of-defense, mo, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $261.2 million to THE BOEING COMPANY. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $261.2 million.
What is the period of performance?
Start: 2004-09-18. End: 2012-10-31.
What justification was provided for the sole-source award, and how was the price determined to be fair and reasonable?
The justification for a sole-source award typically involves circumstances where only one responsible source can provide the required supplies or services. Price reasonableness is usually determined through various methods, such as comparison to previous contracts, market research, or cost analysis. Without the specific justification documentation, it's impossible to confirm the exact rationale or pricing methodology used.
What are the risks associated with a sole-source contract of this magnitude and duration for critical defense assets?
Sole-source contracts of this scale carry risks including potential cost overruns due to lack of competition, reduced innovation, and contractor lock-in. For critical defense assets, this can also lead to supply chain vulnerabilities if the sole provider faces disruptions. The government may have less leverage to negotiate favorable terms or drive efficiency improvements over the contract's life.
How does the performance and cost of this contract compare to other similar aircraft manufacturing contracts awarded competitively?
Direct comparison is challenging without access to detailed performance metrics and cost breakdowns. However, sole-source contracts generally tend to be more expensive than competitively awarded ones. If this contract's cost per unit or overall value significantly exceeds benchmarks for similar, competed contracts, it would indicate potential inefficiency or overpricing.
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
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: J S MCDONNELL BLVD, SAINT LOUIS, MO, 63166
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $98,641,787
Exercised Options: $98,641,787
Current Obligation: $261,220,072
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2004-09-18
Current End Date: 2012-10-31
Potential End Date: 2012-10-31 00:00:00
Last Modified: 2019-09-17
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