L3Harris Technologies awarded $34.2M for aircraft parts, raising questions about competition and value

Contract Overview

Contract Amount: $34,244,211 ($34.2M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2021-04-12

End Date: 2023-08-31

Contract Duration: 871 days

Daily Burn Rate: $39.3K/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 $34.2 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Contract awarded through a non-competitive process, limiting price discovery. 2. Significant contract value suggests a critical need for these aircraft parts. 3. The fixed-price contract type shifts some risk to the contractor. 4. The duration of the contract (871 days) indicates a long-term requirement. 5. The award to L3Harris Technologies, a major defense contractor, warrants scrutiny of its pricing and performance. 6. The absence of small business involvement raises concerns about broader economic impact.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of competitive bids. The firm fixed-price structure provides some cost certainty, but without comparison to other offers, it's difficult to ascertain if the $34.2 million represents a fair market price. The specific nature of 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' suggests specialized components where pricing can be highly variable. Further analysis would require understanding the unit costs and comparing them to similar, competitively procured items if available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor can provide the required goods or services, or in urgent situations. The lack of competition means that the government did not benefit from the price reductions and innovation that can arise from a bidding process. It is unclear from the data if alternative solutions were explored or if this was truly the only viable option.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as there is no competitive pressure to drive down costs. This limits the government's ability to secure the best possible value for its investment.

Public Impact

The Department of the Air Force is the primary beneficiary, receiving critical aircraft parts. The services delivered are essential for maintaining the operational readiness of Air Force aircraft. The contract's geographic impact is primarily tied to the contractor's facilities and the Air Force bases receiving the parts. Workforce implications are likely concentrated within L3Harris Technologies' manufacturing and supply chain operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in inflated pricing for taxpayers.
Sole-source awards can reduce transparency and accountability in government spending.
Absence of small business participation limits economic opportunities for smaller firms.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established contractor like L3Harris suggests potential for reliable delivery.
The contract addresses a specific need within the Department of Defense's aviation sustainment.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. This sector is characterized by high technological barriers to entry, stringent quality requirements, and significant government procurement. The market size for aircraft parts is substantial, driven by military and commercial aviation needs. This specific award likely supports a niche or specialized component within the broader defense industrial base, where L3Harris Technologies is a key player.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for them. This suggests that the primary award went to a large defense contractor. The lack of small business participation means that the economic benefits of this substantial contract are unlikely to flow down to smaller enterprises within the supply chain, potentially limiting opportunities for innovation and growth in the small business defense ecosystem.

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 usually embedded in the contract terms, including performance standards and delivery schedules. Transparency is limited due to the sole-source nature of the award; however, contract award data is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Aircraft Maintenance and Repair
Aerospace Parts Manufacturing
Defense Logistics Support
Air Force Procurement
Specialized Component Manufacturing

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.2 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 $34.2 million.

What is the period of performance?

Start: 2021-04-12. End: 2023-08-31.

What is L3Harris Technologies' track record with similar sole-source contracts for aircraft parts?

L3Harris Technologies, as a major defense contractor, has a history of receiving both competitive and sole-source awards. Analyzing their past performance on sole-source contracts for similar aircraft parts would involve reviewing contract databases for on-time delivery, quality compliance, and any past disputes or overruns. Without specific data on this contractor's history with this particular type of part or similar sole-source awards, it's difficult to provide a definitive assessment. However, their established presence suggests a capacity to fulfill such requirements, though the absence of competition remains a key concern regarding value for money.

How does the $34.2 million award compare to the market value of similar aircraft parts procured competitively?

Direct comparison of the $34.2 million award to the market value of similar aircraft parts procured competitively is challenging without knowing the exact specifications of the parts. Sole-source awards inherently lack a direct competitive benchmark. To assess value, one would need to identify comparable parts that have been awarded through full and open competition, analyze their pricing (including unit costs, quantities, and contract types), and then adjust for any differences in specifications, volume, or delivery timelines. The absence of this competitive data for the BIG SAFARI contract makes a definitive value-for-money assessment difficult, leaning towards a 'questionable' rating.

What are the primary risks associated with this sole-source contract for the Department of Defense?

The primary risks associated with this sole-source contract include potential overpayment due to the lack of competitive pricing, reduced incentive for the contractor to innovate or offer cost efficiencies, and a potential lack of transparency in the procurement process. There's also a risk that the government might become overly reliant on a single supplier for critical components, which could lead to supply chain vulnerabilities. Furthermore, without competitive pressure, there's a diminished incentive for the contractor to proactively identify and implement cost-saving measures or performance improvements beyond the minimum contractual requirements.

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

Historical spending patterns for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' by the Department of the Air Force are likely substantial, given the size and operational tempo of the Air Force's fleet. This category encompasses a wide range of components, from simple fasteners to complex electronic systems. Analyzing historical data would reveal trends in annual spending, major contract awards, and the prevalence of competitive versus sole-source procurements within this sub-sector. Such analysis could indicate whether this $34.2 million award is an outlier or representative of typical spending levels and procurement strategies for these types of parts.

What specific aircraft or systems does this contract for BIG SAFARI parts support?

The provided data does not specify which particular aircraft or weapon systems the 'BIG SAFARI' contract supports. 'BIG SAFARI' is an Air Force Materiel Command program focused on rapid acquisition of intelligence, surveillance, and reconnaissance (ISR) and electronic warfare (EW) capabilities. Therefore, it is highly probable that these parts are intended for specialized aircraft or systems within the ISR/EW domain, rather than standard fighter jets or bombers. Identifying the specific platforms would require deeper access to program details or contract line item descriptions.

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

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: $34,247,617

Exercised Options: $34,247,617

Current Obligation: $34,244,211

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $50,720

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862016G3027

IDV Type: BOA

Timeline