L3Harris Technologies awarded $88.7M for aircraft parts, with limited competition impacting price discovery

Contract Overview

Contract Amount: $88,770,270 ($88.8M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2019-03-01

End Date: 2021-10-31

Contract Duration: 975 days

Daily Burn Rate: $91.0K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

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 $88.8 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Contract value of $88.7M for aircraft parts suggests significant investment in fleet sustainment. 2. Limited competition raises concerns about potential overpayment and reduced value for taxpayer dollars. 3. The fixed-price contract type aims to control costs, but the lack of competition may negate savings. 4. Performance period of nearly three years indicates a need for sustained support for critical systems. 5. The award to L3Harris Technologies positions them as a key supplier within the aerospace sector. 6. Geographic concentration in Texas for contract performance warrants attention for regional economic impact.

Value Assessment

Rating: fair

The contract value of $88.7 million for aircraft parts is substantial. Benchmarking against similar contracts for specialized aircraft components is challenging without more detailed service descriptions. However, the lack of robust competition suggests that the pricing may not have been optimized, potentially leading to a fair-to-questionable value proposition for the government. The fixed-price nature of the contract provides some cost certainty, but the absence of competitive pressure could inflate per-unit costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was not competed on a full and open basis, indicating potential limitations in the procurement process. The specific reasons for this limited competition are not detailed, but it typically suggests a sole-source justification or a restricted solicitation. With limited competition, the government may not have received the best possible pricing or the widest range of technical solutions available in the market. This can lead to higher costs for taxpayers.

Taxpayer Impact: Limited competition means taxpayers may be paying a premium for these aircraft parts, as the government did not benefit from the price reductions typically driven by a competitive bidding process.

Public Impact

The primary beneficiaries are likely the Department of the Air Force, ensuring the operational readiness of its aircraft fleet. Services delivered include the provision of critical aircraft parts and auxiliary equipment, essential for maintenance and repair. Geographic impact is concentrated in Texas, where the contractor L3Harris Technologies is located, potentially boosting the regional economy. Workforce implications may include job creation or retention at L3Harris facilities involved in manufacturing or supplying these parts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of robust competition may lead to inflated prices and reduced value for taxpayer funds.
Limited transparency into the justification for limited competition raises accountability concerns.
Reliance on a single or limited number of suppliers can create supply chain vulnerabilities.

Positive Signals

Fixed-price contract type provides cost certainty for the government.
L3Harris Technologies is an established defense contractor with a track record in aerospace.
The contract supports critical Air Force operations, ensuring national security readiness.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. This sector is characterized by high technological complexity, stringent quality requirements, and significant government procurement. The market size for aircraft parts is substantial, driven by military and commercial aviation needs. This contract represents a portion of the broader spending on defense logistics and sustainment, where companies like L3Harris play a crucial role in maintaining fleet readiness.

Small Business Impact

The data indicates that this contract was not awarded to small businesses, and there is no explicit mention of small business set-asides or subcontracting plans. This suggests that the primary awardee is a large corporation. Consequently, there may be limited direct opportunities for small businesses to participate in this specific contract, potentially impacting the small business ecosystem unless L3Harris engages in significant subcontracting with them.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. Accountability measures are inherent in the fixed-price contract terms, requiring delivery of specified parts. Transparency may be limited due to the non-competitive nature of the award. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

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

Risk Flags

Limited competition may result in higher costs.
Lack of transparency in procurement justification.
Potential for supply chain dependency.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $88.8 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 $88.8 million.

What is the period of performance?

Start: 2019-03-01. End: 2021-10-31.

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

L3Harris Technologies, and its predecessor companies, have a long-standing relationship with the Department of Defense, consistently securing contracts for a wide array of defense systems and components. Their expertise spans avionics, electronic warfare, communication systems, and integrated mission systems. For aircraft parts specifically, L3Harris has a demonstrated history of supplying components for various military aircraft platforms. Analyzing their past performance on similar fixed-price contracts for aircraft parts would involve reviewing delivery timeliness, quality metrics, and any documented disputes or contract modifications. A review of historical contract data would likely show a pattern of significant awards, reflecting their established position as a key defense industrial base supplier. Their ability to meet stringent military specifications and delivery schedules is generally well-regarded, though like any large contractor, specific contract performance can vary.

How does the $88.7 million contract value compare to other similar aircraft parts procurements by the Air Force?

The $88.7 million contract value is a significant sum, placing it in the mid-to-large tier for individual contract awards within the aircraft parts category. To provide a precise comparison, one would need to analyze the specific types of parts procured, the quantities, and the duration of the contract. However, generally speaking, the Air Force procures billions of dollars worth of aircraft parts annually across numerous contracts. Awards in the tens of millions are common for sustainment and upgrade programs for major aircraft platforms. Without knowing the exact nature of the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' covered, it's difficult to benchmark precisely. However, contracts of this magnitude often support the sustainment of a specific fleet or a critical set of components over a multi-year period, suggesting a substantial requirement.

What are the primary risks associated with a 'limited competition' award for aircraft parts?

The primary risks associated with a 'limited competition' award for aircraft parts revolve around cost and innovation. Firstly, the lack of robust competition can lead to inflated prices, as the contractor faces less pressure to offer the most competitive bid. This means taxpayers may be overpaying for the parts. Secondly, limited competition can stifle innovation; without the incentive to differentiate through better technology or more efficient production methods, contractors may have less motivation to invest in improvements. Thirdly, it can create a dependency on a limited number of suppliers, potentially leading to supply chain vulnerabilities if that supplier encounters production issues or goes out of business. Finally, the justification process for limited competition itself can be opaque, raising concerns about fairness and potential favoritism.

What does the contract's duration of approximately 975 days imply about the nature of the parts being supplied?

A contract duration of approximately 975 days (roughly 2.7 years) for aircraft parts suggests that these are not typically off-the-shelf, high-volume consumables. Instead, it implies that the parts are likely specialized, critical components that require a sustained production or supply chain effort. This could include complex manufactured parts, components for specific aircraft systems, or parts for platforms that are undergoing extended maintenance, upgrades, or sustainment phases. The longer duration allows for more predictable planning and resource allocation by both the government and the contractor, ensuring a consistent supply of necessary parts to maintain aircraft readiness over a significant period. It also suggests a stable requirement rather than an urgent, short-term need.

How does the geographic location of contract performance in Texas potentially impact the broader defense industrial base?

The contract performance being located in Texas, where L3Harris Technologies has significant operations, can have a notable impact on the regional defense industrial base. It signifies continued investment and activity in the state's aerospace and defense sector, potentially supporting existing jobs and fostering specialized skills within the local workforce. Furthermore, it may stimulate related industries in Texas that supply materials, components, or services to L3Harris for this contract. For the broader defense industrial base, having major contractors with strong presences in various states helps maintain geographic diversity in defense manufacturing capabilities, which can be strategically important for resilience and national security. It also contributes to the overall economic health of the defense sector within that region.

Industry Classification

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

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

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: $88,891,929

Exercised Options: $88,891,929

Current Obligation: $88,770,270

Subaward Activity

Number of Subawards: 32

Total Subaward Amount: $62,423,812

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862016G3027

IDV Type: BOA

Timeline