DoD's $51M contract for aircraft parts awarded to L3Harris Technologies, with limited competition

Contract Overview

Contract Amount: $51,161,780 ($51.2M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2016-11-23

End Date: 2019-02-28

Contract Duration: 827 days

Daily Burn Rate: $61.9K/day

Competition Type: NOT COMPETED

Pricing Type: COST NO FEE

Sector: Defense

Official Description: IGF::CT::IGF ACAT III BIG SAFARI COMBAT SENT MITD/PDM A/C 64-14849

Place of Performance

Location: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $51.2 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: IGF::CT::IGF ACAT III BIG SAFARI COMBAT SENT MITD/PDM A/C 64-14849 Key points: 1. Value for money is difficult to assess due to limited competition and lack of detailed cost breakdowns. 2. Competition dynamics show a sole-source award, potentially leading to higher prices. 3. Risk indicators include the sole-source nature and the contract's duration. 4. Performance context is limited, with no specific metrics provided for this delivery order. 5. Sector positioning places this within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' industry.

Value Assessment

Rating: questionable

The contract's value of $51.2 million for aircraft parts is substantial. However, without a competitive bidding process, it's challenging to benchmark the pricing against market rates or similar contracts. The 'cost no fee' contract type suggests the government bears the cost of performance, and the contractor receives a fee, which can sometimes lead to less cost control compared to fixed-price contracts. The lack of detailed cost breakdowns further hinders a thorough value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning L3Harris Technologies was the only bidder considered. Sole-source awards typically occur when only one responsible source can provide the required supplies or services. This lack of competition limits the government's ability to negotiate the best possible price and may result in higher costs for taxpayers.

Taxpayer Impact: Sole-source awards mean taxpayers do not benefit from the price reductions typically achieved through competitive bidding. This can lead to overpayment for goods and services.

Public Impact

The primary beneficiary is the Department of the Air Force, receiving essential aircraft parts. Services delivered include the manufacturing and supply of 'Other Aircraft Parts and Auxiliary Equipment'. The geographic impact is centered in Texas, where L3Harris Technologies is located. Workforce implications include support for skilled manufacturing jobs within L3Harris and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential overpricing.
Lack of transparency in cost breakdown makes value assessment difficult.
Sole-source award limits opportunities for small businesses to participate.

Positive Signals

Award to an established contractor with experience in the aerospace sector.
Contract supports critical defense logistics and readiness.
Delivery order structure allows for phased acquisition of necessary parts.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. The market for aircraft parts is substantial, driven by military and commercial aviation needs. This contract represents a portion of the Department of Defense's broader spending on aircraft sustainment and modernization. Comparable spending benchmarks are difficult to establish without more specific details on the parts procured.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting plans for small businesses. This sole-source award limits opportunities for small businesses to participate in this specific contract. The overall impact on the small business ecosystem for this particular procurement is minimal, as it bypasses the competitive process where small businesses might otherwise have a chance to bid.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. Inspector General investigations could be initiated if fraud, waste, or abuse were suspected. Transparency is limited due to the sole-source nature and the absence of publicly available performance reports or detailed cost justifications.

Related Government Programs

Aircraft Parts Manufacturing
Defense Logistics Support
Aerospace Component Supply
Air Force Sustainment Programs

Risk Flags

Sole-source award limits price competition.
Lack of detailed cost information hinders value assessment.
Contract duration could extend beyond initial estimates.
Potential for supply chain disruption if contractor faces issues.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $51.2 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.. IGF::CT::IGF ACAT III BIG SAFARI COMBAT SENT MITD/PDM A/C 64-14849

Who is the contractor on this award?

The obligated recipient is L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P..

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 $51.2 million.

What is the period of performance?

Start: 2016-11-23. End: 2019-02-28.

What is the specific nature of the 'Other Aircraft Parts and Auxiliary Equipment' being procured under this contract?

The provided data does not specify the exact nature of the 'Other Aircraft Parts and Auxiliary Equipment'. The North American Industry Classification System (NAICS) code 336413, 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' covers establishments primarily engaged in manufacturing aircraft parts and auxiliary equipment, not specified elsewhere. This could range from engine components and avionics to structural elements and landing gear parts. Without further details from the contract itself, a precise breakdown is not possible. This lack of specificity is common in high-level contract summaries but can obscure the true value and necessity of the procured items.

What is L3Harris Technologies' track record with the Department of Defense for similar contracts?

L3Harris Technologies is a major defense contractor with a long history of supplying various systems and components to the Department of Defense. While this specific contract is for aircraft parts, L3Harris has extensive experience in areas such as electronic warfare, communications, avionics, and space systems. Their track record with the DoD is generally robust, characterized by numerous large-scale contracts across different branches of the military. However, the performance on any given contract can vary, and a comprehensive review would require examining specific past performance evaluations and delivery histories for contracts of similar scope and complexity.

How does the $51.2 million contract value compare to typical spending on aircraft parts by the Air Force?

The $51.2 million contract value is a significant sum, but its comparability to typical Air Force spending on aircraft parts is difficult to ascertain without more context. The Air Force operates a vast and diverse fleet of aircraft, requiring a continuous supply of parts for maintenance, repair, and overhaul (MRO). Annual spending on aircraft parts can run into billions of dollars across all programs. This $51.2 million contract, awarded as a delivery order, likely represents a specific set of parts or a particular sustainment effort for a defined period. Its 'typicality' depends heavily on the specific aircraft platform and the nature of the parts procured, which are not detailed here.

What are the primary risks associated with a sole-source award for critical aircraft components?

The primary risks associated with a sole-source award for critical aircraft components include inflated pricing due to the lack of competition, potential for reduced quality if the contractor faces no competitive pressure, and a lack of innovation. Taxpayers may end up paying more than necessary. Furthermore, reliance on a single source can create supply chain vulnerabilities; if the sole-source provider experiences production issues or goes out of business, the government could face significant delays or be unable to procure essential parts, impacting operational readiness. The absence of competitive benchmarking also makes it harder to identify and mitigate performance risks.

What is the historical spending pattern for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' by the Department of Defense?

Historical spending patterns for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (NAICS 336413) by the Department of Defense are substantial, reflecting the continuous need to maintain and upgrade its vast aircraft fleet. While specific annual figures for this NAICS code alone are not readily available in summary data, the DoD's overall budget for aircraft sustainment and procurement runs into tens of billions of dollars annually. Spending within this category would fluctuate based on fleet age, modernization programs, and operational tempo. The trend generally shows consistent, high-level investment in ensuring the airworthiness and operational capability of military aircraft through the acquisition of necessary parts and components.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 10001 JACK FINNEY BLVD, GREENVILLE, TX, 75402

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $51,161,780

Exercised Options: $51,161,780

Current Obligation: $51,161,780

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $233,370

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862016G3027

IDV Type: BOA

Timeline