DoD awards $32.7M contract for aircraft parts, with L3Harris Technologies as sole provider

Contract Overview

Contract Amount: $32,737,264 ($32.7M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2022-09-19

End Date: 2024-12-31

Contract Duration: 834 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 $32.7 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Contract awarded on a sole-source basis, raising questions about price competitiveness. 2. Significant duration of 834 days suggests a long-term need for these aircraft parts. 3. The contract's value is substantial, indicating critical support for Air Force operations. 4. No small business set-aside or subcontracting was indicated, potentially limiting broader economic impact. 5. The fixed-price contract type shifts risk to the contractor, potentially stabilizing costs. 6. Texas is the performance location, suggesting a concentration of related economic activity.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its sole-source nature and specific product category. Without competitive bids, it's difficult to ascertain if the $32.7 million price represents optimal value for the taxpayer. The fixed-price structure provides some cost certainty, but the lack of competition means there's less pressure on the contractor to offer the lowest possible price. Further analysis would require comparing the unit costs of these specific aircraft parts to similar items procured competitively or through other channels.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, L3Harris Technologies Integrated Systems L.P., was considered. This approach bypasses the typical competitive bidding process, which usually involves multiple companies vying for the contract. While sole-source awards can be justified for unique capabilities or urgent needs, they limit price discovery and can potentially lead to higher costs for the government compared to a fully competed contract.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the best possible price, as competition is a key driver for cost savings. This contract's value could have been lower if other qualified suppliers had the opportunity to bid.

Public Impact

The primary beneficiary is the Department of the Air Force, ensuring the availability of critical aircraft parts. Services delivered include the manufacturing and supply of 'Other Aircraft Parts and Auxiliary Equipment'. The contract's performance location is in Texas, potentially impacting the local economy and workforce. This contract supports ongoing Air Force readiness and operational capabilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in inflated pricing.
Sole-source award limits opportunities for other businesses, including small businesses.
Contract duration and value warrant close monitoring for performance and cost overruns.

Positive Signals

Fixed-price contract type provides cost predictability.
L3Harris is an established defense contractor, suggesting potential for reliable delivery.
Contract supports critical Air Force operational needs.

Sector Analysis

The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector is a vital component of the aerospace and defense industry. This contract falls within the broader defense industrial base, supporting the maintenance and operational readiness of military aircraft. The total value of $32.7 million is significant for this specific type of procurement, highlighting the specialized nature of the parts required. Comparable spending in this sector often involves complex supply chains and stringent quality control measures.

Small Business Impact

This contract was not set aside for small businesses, nor was there an indication of subcontracting requirements for small businesses. This means that the primary contractor, L3Harris Technologies, will likely fulfill the contract requirements directly. Consequently, there are limited direct benefits or opportunities for the small business ecosystem through this specific award. The absence of small business participation could be a missed opportunity to foster broader economic engagement and innovation.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and procurement regulations. The fixed-price nature of the contract provides some level of cost control, but performance monitoring is crucial to ensure timely delivery and quality of the aircraft parts. 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.

Related Government Programs

Aircraft Parts Procurement
Defense Logistics Support
Air Force Maintenance, Repair, and Overhaul (MRO)
Aerospace Manufacturing Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for uncompetitive pricing
No small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.7 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 $32.7 million.

What is the period of performance?

Start: 2022-09-19. End: 2024-12-31.

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

L3Harris Technologies Integrated Systems L.P. has a history of receiving sole-source contracts from the Department of Defense, particularly for specialized components and sustainment services. Analyzing their past performance on similar sole-source awards can provide insights into their reliability, delivery timelines, and cost management. While sole-source awards are often justified by unique capabilities or existing system integration, a review of their historical performance on such contracts is essential to assess the risk associated with this $32.7 million award. This includes examining any instances of cost overruns, delivery delays, or quality issues on previous sole-source procurements to better understand the potential value and risks associated with the current contract.

How does the $32.7 million contract value compare to historical spending on similar aircraft parts by the Air Force?

Comparing the $32.7 million contract value to historical spending on similar aircraft parts by the Air Force is crucial for assessing value for money. However, without specific details on the exact nature of the 'Other Aircraft Parts and Auxiliary Equipment,' a direct comparison is difficult. If this contract represents a significant increase over previous procurements for comparable parts, it could indicate rising costs or a lack of competitive pressure. Conversely, if it aligns with historical trends for specialized components, it might represent fair market value. Further analysis would require identifying specific part numbers or categories and examining historical contract data for those items, ideally from multiple sources to establish a benchmark.

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

The primary risks associated with a sole-source award for critical aircraft parts include potential overpricing due to the absence of competition, reduced incentive for the contractor to innovate or improve efficiency, and a lack of transparency in the procurement process. Taxpayers may end up paying more than necessary. Furthermore, reliance on a single supplier can create vulnerabilities in the supply chain; if the sole source experiences production issues or goes out of business, the Air Force could face significant operational disruptions. The lack of competitive pressure also means less opportunity for the government to negotiate favorable terms or explore alternative solutions.

How effective is the fixed-price contract type in managing costs for this specific type of aircraft part?

The fixed-price contract type is generally effective in managing costs for aircraft parts when the scope of work and material requirements are well-defined and stable. It shifts the risk of cost overruns to the contractor, L3Harris Technologies, providing the government with cost certainty. However, the effectiveness can be diminished in sole-source situations if the initial price is not rigorously negotiated or benchmarked. For complex or custom-manufactured parts, there might be inherent uncertainties that could lead to the contractor seeking higher initial prices to cover potential risks. Therefore, while the contract type offers predictability, the actual value realized depends heavily on the initial pricing and ongoing oversight.

What are the potential performance implications of awarding this contract to L3Harris Technologies without competition?

Awarding this contract to L3Harris Technologies without competition could have mixed performance implications. On the positive side, L3Harris is an established defense contractor with existing infrastructure and expertise, potentially ensuring reliable production and delivery of the aircraft parts. This continuity can be beneficial for maintaining operational readiness. However, the lack of competition removes the incentive for L3Harris to aggressively pursue cost efficiencies or explore innovative manufacturing techniques that might be driven by a competitive environment. This could lead to less optimal performance in terms of speed or cost-effectiveness compared to a scenario with multiple bidders.

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

Analyzing the historical spending trend for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' by the Department of the Air Force is essential for contextualizing the $32.7 million award. While specific data for this exact category is not provided, the broader defense aerospace sector typically sees consistent, substantial investment. Spending in this area is driven by the need to maintain aging fleets, upgrade existing aircraft, and support new platforms. Trends can be influenced by geopolitical factors, defense budgets, and technological advancements. A significant increase or decrease in spending within this category over time could indicate shifts in Air Force priorities, supply chain dynamics, or the effectiveness of previous procurement strategies.

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

Financial Breakdown

Contract Ceiling: $32,737,643

Exercised Options: $32,737,643

Current Obligation: $32,737,264

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862021G4027

IDV Type: BOA

Timeline