DoD's $29.4M L3Harris contract for aircraft parts shows limited competition and fair value

Contract Overview

Contract Amount: $29,395,056 ($29.4M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2019-09-05

End Date: 2021-09-02

Contract Duration: 728 days

Daily Burn Rate: $40.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: BIG SAFARI

Place of Performance

Location: GREENVILLE, HUNT County, TEXAS, 75402

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $29.4 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Contract awarded through a sole-source justification, raising concerns about price discovery. 2. Value appears fair when benchmarked against similar procurements, though competition was absent. 3. Performance timeline of 728 days suggests a moderate execution risk. 4. The contract falls within the 'Other Aircraft Parts' manufacturing sector. 5. No small business set-aside was utilized, potentially limiting broader participation. 6. Oversight is standard for DoD contracts, but transparency could be enhanced.

Value Assessment

Rating: fair

The total contract value of $29.4 million for aircraft parts appears to be within a reasonable range when compared to similar procurements in the defense sector. However, the lack of competition makes a definitive value-for-money assessment challenging. Without competitive bids, it's difficult to ascertain if the pricing reflects the best possible market rate. The fixed-price nature of the contract shifts some risk to the contractor, which can be a positive indicator for cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning it was not competed openly. This approach is typically reserved for situations where only one responsible source can provide the required goods or services. The absence of multiple bidders means there was no direct price competition, which can lead to higher costs for the government compared to a fully competed contract.

Taxpayer Impact: Taxpayers may have paid a premium due to the lack of competitive bidding. Without competing offers, the government did not benefit from the price reductions typically achieved through market forces.

Public Impact

The Department of Defense benefits from the acquisition of critical aircraft parts, ensuring operational readiness. Services delivered include the manufacturing and supply of specialized aircraft components. The geographic impact is primarily within Texas, where L3Harris Technologies is located. Workforce implications include support for manufacturing jobs within the aerospace and defense industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially increases cost to taxpayers.
Lack of small business participation may reduce opportunities for smaller firms in the supply chain.
Limited public information on specific performance metrics makes it difficult to assess contractor efficiency.
The 'Other Aircraft Parts' category is broad, making direct comparisons challenging.

Positive Signals

L3Harris Technologies is a known defense contractor with established capabilities.
The firm-fixed-price contract type provides cost certainty for the government.
The contract duration of 728 days allows for a structured delivery schedule.
The award is for essential aircraft parts, supporting critical defense missions.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. This sector is characterized by high technological requirements, stringent quality standards, and significant government procurement. The market size for defense aerospace components is substantial, driven by ongoing military modernization and maintenance needs. This specific procurement likely supports a niche requirement within the broader aircraft parts market, where specialized manufacturing capabilities are essential.

Small Business Impact

This contract did not include a small business set-aside, and the prime contractor, L3Harris Technologies, is a large business. This means that opportunities for small businesses to directly participate as prime contractors were absent. While L3Harris may engage small businesses as subcontractors, the lack of a formal set-aside suggests that subcontracting plans were not a primary driver for this specific award. This could limit the direct economic benefit to the small business ecosystem for this particular contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Air Force contracting and program management offices. Standard accountability measures for firm-fixed-price contracts include monitoring delivery schedules and quality compliance. Transparency is generally maintained through contract databases, but detailed performance reports are often not publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Aircraft Parts Procurement
L3Harris Technologies Defense Contracts
Sole-Source Defense Procurements
Other Aircraft Parts and Auxiliary Equipment Manufacturing

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns due to non-competitive pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.4 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.. BIG SAFARI

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 $29.4 million.

What is the period of performance?

Start: 2019-09-05. End: 2021-09-02.

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

L3Harris Technologies is a major defense contractor with a significant history of awards from the Department of Defense across various platforms and services. They are known for their expertise in areas such as electronic warfare, communications, and integrated mission systems. While this specific contract is for aircraft parts, the company's broader portfolio indicates a substantial capacity to fulfill complex defense requirements. Historical data suggests a consistent flow of contracts, reflecting their established position in the defense industrial base. Performance on past contracts would need to be reviewed on a case-by-case basis to assess specific delivery and quality metrics, but their continued large-scale awards imply a generally satisfactory performance history with the DoD.

How does the $29.4 million value compare to similar aircraft parts contracts?

Benchmarking the $29.4 million value requires comparing it to contracts for similar types and quantities of aircraft parts, which can be challenging due to the specialized nature of defense components. However, for a sole-source award of this magnitude within the 'Other Aircraft Parts' category, the price appears to be within a fair range, assuming the components are highly specialized or proprietary. Without competitive bids, it's difficult to establish a precise market value. If this were a standard, widely available part, the price might be considered high due to the lack of competition. The firm-fixed-price structure provides some cost certainty, but the absence of competition prevents a definitive assessment of optimal value for money.

What are the primary risks associated with this sole-source contract?

The primary risk associated with this sole-source contract is the potential for inflated pricing due to the absence of competitive bidding. Without competing offers, the government lacks the leverage to negotiate the lowest possible price. Another risk is the potential for contractor complacency, as there is no immediate threat of losing future business to competitors on this specific award. Furthermore, the lack of transparency inherent in sole-source justifications can obscure the true necessity and justification for awarding to a single vendor, potentially masking inefficiencies or suboptimal decision-making. Ensuring robust oversight and justification documentation is crucial to mitigate these risks.

How effective is the 'Other Aircraft Parts' category in assessing spending patterns?

The 'Other Aircraft Parts' category (PSC code 13XX, 15XX, 16XX, 17XX, 19XX, 25XX, 29XX, 39XX, 41XX, 43XX, 47XX, 53XX, 54XX, 55XX, 56XX, 59XX, 61XX, 62XX, 63XX, 65XX, 66XX, 69XX, 71XX, 72XX, 73XX, 74XX, 75XX, 76XX, 77XX, 79XX, 80XX, 81XX, 83XX, 84XX, 85XX, 89XX) is quite broad and can encompass a wide range of components, from simple fasteners to complex avionic systems. This broadness makes it challenging to draw precise spending pattern conclusions or conduct highly accurate benchmarking without further sub-categorization or specific part identification. While it indicates spending within the aircraft parts domain, it lacks the granularity to identify specific trends in technology, cost drivers, or supplier concentration within that domain. Therefore, while useful for high-level tracking, it limits detailed analytical insights into spending patterns.

What are the implications of the 728-day duration for contract performance?

A duration of 728 days (approximately two years) for this contract suggests a moderate-term requirement for the aircraft parts. This timeframe allows for a structured production and delivery schedule, potentially accommodating complex manufacturing processes or phased deliveries. For the government, it provides a degree of stability in supply for the specified period. From a risk perspective, a longer duration can increase exposure to market fluctuations (e.g., material costs) if not adequately managed within the contract's pricing structure. However, for a sole-source award, the extended period might also indicate a lack of readily available alternatives or a need for specialized, long-lead-time components, reinforcing the justification for a single awardee.

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

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc (UEI: 004203337)

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: $29,395,056

Exercised Options: $29,395,056

Current Obligation: $29,395,056

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862016G3027

IDV Type: BOA

Timeline