L3Harris awarded $44.5M for aircraft parts, with limited competition and potential value concerns

Contract Overview

Contract Amount: $44,546,473 ($44.5M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2023-01-01

End Date: 2025-09-30

Contract Duration: 1,003 days

Daily Burn Rate: $44.4K/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 $44.5 million to L3HARRIS TECHNOLOGIES INTEGRATED SYSTEMS L.P. for work described as: BIG SAFARI Key points: 1. Contract awarded via other-than-full-and-open competition, raising questions about price discovery. 2. Significant contract value for specialized aircraft parts manufacturing. 3. Performance period extends over two years, indicating a need for sustained supply. 4. The firm fixed-price contract type shifts risk to the contractor. 5. No small business set-aside noted, potentially limiting opportunities for smaller firms. 6. Geographic concentration in Texas for contract performance.

Value Assessment

Rating: fair

The contract value of $44.5 million for aircraft parts requires careful benchmarking against similar procurements. Without detailed cost breakdowns or comparisons to market rates for comparable parts, assessing the value for money is challenging. The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code suggests a broad category, and the specific nature of the parts will heavily influence pricing. The fixed-price nature of the contract places the onus on L3Harris to manage costs effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded using 'Other-than-full-and-open competition,' indicating that only one source was solicited or that a limited number of sources were considered. This approach is typically justified by specific circumstances, such as the urgency of the need or the unique capabilities of the sole provider. The limited competition means that the government did not benefit from the full spectrum of market offerings, potentially leading to higher prices than if it had been fully competed.

Taxpayer Impact: Limited competition can result in taxpayers paying a premium, as the absence of robust bidding limits the government's ability to negotiate the lowest possible price.

Public Impact

The Department of Defense is the primary beneficiary, receiving essential aircraft parts. Services delivered include the manufacturing and supply of specialized aircraft components. Contract performance is geographically concentrated in Texas. The contract supports the aerospace manufacturing workforce, particularly within L3Harris Technologies and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may lead to suboptimal pricing for taxpayers.
Lack of transparency in the justification for other-than-full-and-open competition.
Potential for cost overruns if not adequately managed by the contractor under fixed-price terms.
Dependence on a single contractor for critical aircraft parts.

Positive Signals

Firm fixed-price contract shifts cost risk to the contractor.
L3Harris Technologies is an established defense contractor with relevant experience.
Contract duration suggests a stable supply chain for critical components.

Sector Analysis

The aerospace and defense sector is characterized by high technological complexity and significant government procurement. This contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' category, which is a vital sub-sector supporting military readiness. The market for such specialized parts is often concentrated among a few key suppliers due to stringent quality and technical requirements. Benchmarking spending in this area requires comparing against similar sole-source or limited-competition awards for specialized military aircraft components.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This suggests that opportunities for small businesses to participate in this specific award may be limited, unless they are part of L3Harris's broader supply chain. Further investigation into L3Harris's subcontracting plans would be necessary to fully assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The firm fixed-price contract type provides some level of cost control, but oversight will focus on delivery schedules, quality standards, and adherence to contract terms. Transparency regarding the justification for limited competition and the specific parts procured would enhance accountability.

Related Government Programs

Aircraft Parts Procurement
Defense Logistics Support
Aerospace Manufacturing Contracts
L3Harris Technologies Contracts

Risk Flags

Limited Competition Justification
Potential for Price Inflation
Supply Chain Dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.5 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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $44.5 million.

What is the period of performance?

Start: 2023-01-01. End: 2025-09-30.

What specific aircraft parts are being procured under this contract, and what is their criticality to defense operations?

The provided data classifies the contract under NAICS code 336413, 'Other Aircraft Parts and Auxiliary Equipment Manufacturing.' However, it does not specify the exact parts. These could range from structural components to specialized electronic or mechanical systems essential for the operation and maintenance of various military aircraft. The criticality would depend on the specific platform they support; for instance, parts for frontline fighter jets or long-endurance surveillance aircraft would be considered highly critical for maintaining operational readiness and mission capability. Without this specific detail, a precise assessment of their impact on defense operations is limited.

How does the $44.5 million contract value compare to historical spending on similar aircraft parts by the Department of Defense?

Benchmarking the $44.5 million award requires comparing it against historical data for similar 'Other Aircraft Parts and Auxiliary Equipment' procurements, particularly those awarded under limited or sole-source conditions. The Department of Defense procures a vast array of aircraft parts, and values can fluctuate significantly based on the complexity, quantity, and criticality of the items. A comprehensive analysis would involve identifying comparable contracts awarded over the past 3-5 years, noting the procuring agency, competition level, contract type, and final award value. Without access to such a detailed comparative dataset, it is difficult to definitively state whether this award represents a favorable or unfavorable price point relative to historical trends.

What are the specific justifications provided by the Department of Defense for awarding this contract on a limited competition basis?

The justification for awarding a contract under 'Other-than-full-and-open competition' (often referred to as sole-source or limited competition) typically stems from specific circumstances outlined in federal acquisition regulations (FAR). Common justifications include: (1) the property is available only from a limited number of sources; (2) there is a public exigency requiring the supplies or services to be procured in a short amount of time; (3) the agency head determines that a specific source is essential for national security; or (4) for follow-on work to a previously awarded contract where only the original contractor can meet requirements. The specific FAR citation and detailed rationale would be documented in the contract file and potentially in publicly available sources like SAM.gov, but this information is not present in the provided data snippet.

What is L3Harris Technologies' track record with the Department of Defense, particularly concerning contracts of similar size and scope?

L3Harris Technologies is a major defense contractor with a substantial history of performing work for the Department of Defense across various domains, including aerospace, communications, and electronic systems. Their track record typically involves numerous large-scale contracts, many of which are complex and high-value. For contracts similar in scope to this $44.5 million award for aircraft parts, their performance history would likely show a pattern of delivering complex systems and components. Analysis of their past performance would involve reviewing contract awards, delivery performance ratings, past performance questionnaires, and any instances of contract disputes or terminations. Generally, L3Harris is considered an experienced and capable supplier within the defense industrial base.

What are the potential risks associated with relying on L3Harris Technologies for these specific aircraft parts, given the limited competition?

The primary risk associated with limited competition is the potential for inflated pricing, as the government has fewer options to negotiate favorable terms. Another risk is vendor lock-in, where the government becomes dependent on a single supplier, making it difficult to switch even if performance issues arise or better alternatives become available. Furthermore, if L3Harris faces production challenges, supply chain disruptions, or financial difficulties, it could significantly impact the availability of critical aircraft parts, potentially jeopardizing defense readiness. The lack of competitive pressure might also reduce the incentive for L3Harris to innovate or improve efficiency beyond what is contractually required.

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: $44,546,473

Exercised Options: $44,546,473

Current Obligation: $44,546,473

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $90,654

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862021G4027

IDV Type: BOA

Timeline