DoD's $27.5M L3Harris Contract for Aircraft Parts: A Deep Dive into Value and Competition

Contract Overview

Contract Amount: $27,538,877 ($27.5M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2022-03-01

End Date: 2023-03-31

Contract Duration: 395 days

Daily Burn Rate: $69.7K/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 $27.5 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Analysis of a $27.5M contract awarded to L3Harris Technologies for aircraft parts reveals key insights into government spending. 2. The contract's value and duration suggest a significant need for specialized components within the Air Force's operations. 3. Examining the 'NOT COMPETED' award type is crucial for understanding potential impacts on price and innovation. 4. Benchmarking this contract against similar procurements can illuminate whether the government achieved optimal value. 5. Assessing the contractor's performance history and the specific nature of the parts supplied provides performance context. 6. The contract's sector positioning within 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' highlights a niche but vital area of defense spending.

Value Assessment

Rating: fair

The total award amount of $27.5 million for a 395-day period requires careful scrutiny. Without direct comparable contract data for identical parts or services, a precise value-for-money assessment is challenging. However, the 'NOT COMPETED' nature of the award raises questions about whether the government secured the most competitive pricing. The benchmarked value of $697,190 (br) suggests a potential cost per unit or a smaller component of the overall contract, which needs further context to be fully evaluated against market rates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT COMPETED' basis, indicating that a full and open competition was not conducted. This typically occurs when only one source is capable of meeting the government's needs, often due to proprietary technology, unique capabilities, or urgent requirements. The lack of multiple bidders means that price discovery through competitive bidding was bypassed, potentially leading to higher costs for the government compared to a competed scenario.

Taxpayer Impact: For taxpayers, a sole-source award means there is a reduced likelihood of benefiting from cost savings that typically arise from competitive bidding processes. This can result in a less efficient use of public funds if alternative, more cost-effective solutions were available but not explored.

Public Impact

The primary beneficiaries of this contract are the Department of the Air Force, ensuring the continued operational readiness of its aircraft fleet. The services delivered involve the provision of specialized aircraft parts and auxiliary equipment, critical for maintenance and repair operations. The geographic impact is primarily within Texas (st: TX, sn: TEXAS), where L3Harris Technologies Integrated Systems L.P. is located, suggesting a concentration of defense manufacturing in that region. Workforce implications include the potential for sustained employment for skilled manufacturing and technical personnel at the contractor's facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher prices than could be achieved through a competitive bidding process.
The 'NOT COMPETED' status requires justification to ensure it was indeed the only viable option.
Limited transparency into the pricing structure due to the absence of multiple bids.
Potential for vendor lock-in if the parts are highly specialized and proprietary.
The duration of the contract (395 days) might indicate a long-term need that could have benefited from a more strategic sourcing approach.

Positive Signals

Award to a known contractor, L3Harris Technologies, suggests a level of trust in their capability to deliver specialized parts.
The contract supports critical Air Force operations, contributing to national security objectives.
The fixed-price contract type (FIRM FIXED PRICE) provides cost certainty for the government once the price is agreed upon.
The contract is for aircraft parts, a vital component of military readiness and sustainment.

Sector Analysis

The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector is a critical component of the broader aerospace and defense industry. This sector is characterized by high technological sophistication, stringent quality control, and often, specialized production processes. Government contracts, particularly from the Department of Defense, form a significant portion of the demand in this niche. Comparable spending benchmarks are difficult to establish without specific part details, but the overall defense aerospace market is substantial, with billions spent annually on aircraft sustainment and upgrades.

Small Business Impact

This contract was not competed and there is no indication of small business set-asides (ss: false, sb: false). Therefore, this specific award does not appear to directly benefit small businesses through set-aside provisions. However, the prime contractor, L3Harris Technologies, may engage small businesses as subcontractors. The extent of subcontracting to small businesses is not detailed in the provided data, but it is a common practice in the defense industry to leverage specialized capabilities from smaller firms.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to deliver specified goods at an agreed-upon price. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the contract's performance or award process.

Related Government Programs

Aircraft Parts Procurement
Defense Logistics and Sustainment
Aerospace Manufacturing Contracts
Air Force Equipment Maintenance
Sole-Source Defense Contracts

Risk Flags

Sole-source award requires justification.
Lack of competition may impact price.
Need for detailed justification for 'NOT COMPETED' status.
Potential for higher costs due to lack of competitive bidding.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.5 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 $27.5 million.

What is the period of performance?

Start: 2022-03-01. End: 2023-03-31.

What is the specific nature of the aircraft parts being procured under this contract, and why were they deemed only available from L3Harris Technologies?

The provided data indicates the contract is for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (nd: Other Aircraft Parts and Auxiliary Equipment Manufacturing). The specific nature of these parts is not detailed, but the 'NOT COMPETED' award type (ct: NOT COMPETED) suggests they are either highly specialized, proprietary to L3Harris, or required under urgent circumstances where only L3Harris could meet the demand within the required timeframe. Without further documentation, the exact justification for sole-sourcing remains unclear, but common reasons include unique technical specifications, existing system integration requirements, or the unavailability of alternative suppliers capable of meeting stringent military standards.

How does the total contract value of $27.5 million compare to historical spending on similar aircraft parts by the Department of the Air Force?

Comparing the $27.5 million total award value (a: 27538876.74) to historical spending on similar aircraft parts requires access to a broader dataset of past Air Force procurements. The provided data does not include historical spending figures for comparable items. However, the contract's duration of 395 days (dur: 395) suggests a significant, medium-term requirement. To assess value, one would need to identify previous contracts for the same or functionally equivalent parts, analyze their pricing, and account for inflation and market fluctuations. The absence of this comparative data makes it difficult to definitively state whether $27.5 million represents a high, low, or average expenditure for such components.

What are the potential risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risk associated with awarding a contract of $27.5 million on a sole-source basis is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may pay more than necessary for the parts. Other risks include reduced innovation, as there is less incentive for the sole provider to develop more cost-effective or advanced solutions. Furthermore, it can create a dependency on a single supplier, making future procurements potentially more challenging and costly if the supplier's circumstances change. There's also a risk of complacency from the contractor regarding quality or delivery timelines, as the government has fewer immediate alternatives.

What is L3Harris Technologies' track record with the Department of the Air Force, particularly concerning contracts for aircraft parts?

L3Harris Technologies Integrated Systems L.P. (co: L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P.) is a significant defense contractor. While the provided data does not detail their specific track record with the Air Force for aircraft parts, their status as a prime contractor suggests a history of successful contract performance. To fully assess their track record, one would need to examine past contract awards, performance reviews (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or contract terminations. Their ability to secure a sole-source award of this size implies a recognized capability and potentially a strong past performance history with the agency.

How does the benchmarked value of $697,190 (br) relate to the overall contract value and what does it signify?

The benchmarked value (br) of $697,190 is significantly lower than the total contract award of $27,538,876.74. This discrepancy suggests that the benchmark value might represent a specific component, a subset of the total order, or perhaps a cost element used for internal analysis rather than the full contract price. Without explicit definition of what 'br' represents in this context (e.g., average order value, a specific part's cost, or a historical average for a related item), its direct significance to the overall contract value is unclear. It could potentially be a reference point for a particular type of part or a smaller delivery order within a larger framework, but its relationship to the $27.5M total needs further clarification.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

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, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $32,622,565

Exercised Options: $32,622,565

Current Obligation: $27,538,877

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862021G4027

IDV Type: BOA

Timeline