DoD awards $70.5M contract for aircraft parts, with L3Harris Technologies as sole provider

Contract Overview

Contract Amount: $70,540,076 ($70.5M)

Contractor: L3harris Technologies Integrated Systems L.P.

Awarding Agency: Department of Defense

Start Date: 2023-12-27

End Date: 2026-04-30

Contract Duration: 855 days

Daily Burn Rate: $82.5K/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 $70.5 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 discovery and potential for overpayment. 2. Limited competition suggests potential risks to innovation and access to a broader range of solutions. 3. The contract duration of 855 days indicates a significant, long-term need for these aircraft parts. 4. Awarded by the Department of the Air Force, this contract supports the sustainment of critical aviation assets. 5. The fixed-price nature of the contract shifts some financial risk to the contractor. 6. Texas is the primary location for contract performance, potentially benefiting the local economy.

Value Assessment

Rating: questionable

Without competitive bidding, it is difficult to benchmark the value for money. The contract's fixed-price nature provides some cost control, but the absence of competition means the government may not be receiving the most advantageous pricing available in the market. Further analysis would require comparing this award to similar sole-source contracts for comparable aircraft parts to assess if the pricing is reasonable.

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 standard competitive procurement process, which typically involves soliciting bids from multiple vendors. The lack of competition limits the government's ability to leverage market forces to achieve lower prices and potentially better terms.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. This also reduces the opportunity for other businesses to compete for government contracts.

Public Impact

The Department of the Air Force benefits from the continued availability of essential aircraft parts, ensuring operational readiness. This contract supports the maintenance and sustainment of specific aircraft, contributing to national defense capabilities. The primary geographic impact is in Texas, where the contractor is located, potentially creating or sustaining jobs in the region. The contract ensures the supply chain for critical components remains intact, supporting the broader aerospace and defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Lack of competition may stifle innovation and limit access to alternative solutions.
Contract duration of over two years suggests a long-term reliance on a single supplier.

Positive Signals

Fixed-price contract shifts some financial risk to the contractor.
Contract supports critical Department of Defense aviation needs.
Performance in Texas may provide economic benefits to the local area.

Sector Analysis

This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector, a critical component of the broader aerospace and defense industry. This sector is characterized by high technological demands, stringent quality control, and often, specialized manufacturing capabilities. The market size for aircraft parts is substantial, driven by both military and commercial aviation needs. This specific award to L3Harris Technologies suggests a focus on specialized or proprietary components where L3Harris may hold unique manufacturing expertise or existing production lines.

Small Business Impact

This contract was not competed and there is no indication of small business set-aside or subcontracting requirements. The sole-source nature of the award means that small businesses would not have had an opportunity to bid on this specific contract. Further investigation would be needed to determine if L3Harris Technologies has a subcontracting plan that includes small businesses for any portion of this work.

Oversight & Accountability

The Department of Defense has established oversight mechanisms for contract awards, including review by contracting officers and potentially higher-level procurement authorities. The fixed-price nature of the contract provides a degree of financial oversight by setting a ceiling on costs. Transparency regarding sole-source justifications and the specific aircraft parts being procured would be subject to DoD regulations and public disclosure policies. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Aircraft Parts Procurement
Defense Logistics Agency Contracts
Aerospace Manufacturing
Sole-Source Defense Contracts
Air Force Sustainment Programs

Risk Flags

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

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $70.5 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 $70.5 million.

What is the period of performance?

Start: 2023-12-27. End: 2026-04-30.

What specific aircraft or systems does this contract support, and why was L3Harris Technologies selected as the sole source?

The provided data indicates the contract is for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (NAICS 336413) and awarded to L3Harris Technologies Integrated Systems L.P. The specific aircraft or systems are not detailed in the provided data. Sole-source awards are typically justified when only one responsible source is available or capable of meeting the government's needs. This could be due to proprietary technology, unique manufacturing capabilities, existing infrastructure, or urgent requirements where competition is not feasible. A detailed justification document, often required for sole-source procurements, would contain the specific reasons for selecting L3Harris and the systems involved. Without access to this justification, the precise rationale remains speculative, but it likely centers on L3Harris's unique position as a supplier for these particular parts.

How does the awarded amount of $70.5 million compare to historical spending on similar aircraft parts or with other suppliers?

Comparing the $70.5 million award to historical spending requires access to historical contract data for similar aircraft parts, either from L3Harris Technologies or other manufacturers. The provided data does not include historical spending benchmarks or details on the specific parts. However, given that this is a sole-source award for a duration of 855 days (approximately 2.37 years), the annual spending would average around $29.7 million. To assess value for money, this figure would need to be benchmarked against the average prices paid for comparable parts through competitive solicitations or against L3Harris's own pricing on previously competed contracts, if available. The absence of competition makes direct comparison challenging and raises concerns about potential overpayment if market prices are lower.

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

The primary risks associated with a sole-source award of this magnitude ($70.5 million) include: 1. **Higher Costs:** Without competitive bidding, the government may pay a premium compared to what could be achieved in a competitive environment. The contractor has less incentive to offer the lowest possible price. 2. **Reduced Innovation:** Limiting the supplier pool can stifle innovation as alternative solutions or more cost-effective methods from other companies are not explored. 3. **Dependency and Lock-in:** The government becomes dependent on a single supplier, potentially leading to difficulties if that supplier faces production issues, price increases, or changes its business strategy. 4. **Limited Oversight Effectiveness:** While oversight mechanisms exist, the lack of comparative data from competitors makes it harder to definitively assess the fairness and reasonableness of the pricing and terms. 5. **Potential for Complacency:** The sole-source provider might become complacent regarding quality or service delivery due to the absence of competitive pressure.

What is the expected performance period and delivery schedule for this contract, and are there any performance metrics specified?

The contract has a start date of December 27, 2023, and an end date of April 30, 2026. This provides a performance period of approximately 855 days, or about 2 years and 4 months. The data indicates this is a 'DELIVERY ORDER' under a larger contract vehicle, suggesting that specific delivery schedules for the parts will be managed through individual orders placed against this contract. While the data specifies the contract type as 'FIRM FIXED PRICE,' it does not detail specific performance metrics or key performance indicators (KPIs) that L3Harris Technologies must meet. Typically, such metrics would be outlined in the contract's statement of work (SOW) and could include delivery timelines, quality standards, and defect rates.

What is the historical spending trend for this specific type of aircraft part or for L3Harris Technologies with the Department of Defense?

The provided data focuses on a single contract award and does not offer historical spending trends for this specific type of aircraft part or for L3Harris Technologies with the Department of Defense. To analyze historical spending, one would need to query federal procurement databases (like FPDS or USASpending) for previous contracts awarded to L3Harris for similar parts (NAICS 336413) or for the specific aircraft systems this contract supports. Examining past awards, particularly those that were competitively procured, would provide valuable context for assessing the reasonableness of the current $70.5 million sole-source award. Understanding L3Harris's track record with the DoD, including the volume and value of previous contracts, would also inform risk assessment.

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: $78,736,152

Exercised Options: $78,736,152

Current Obligation: $70,540,076

Subaward Activity

Number of Subawards: 8

Total Subaward Amount: $6,733,715

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: FA862021G4027

IDV Type: BOA

Timeline