DoD's $26.7M Aircrew Training Contract Awarded to CAE USA Inc. with No Competition

Contract Overview

Contract Amount: $26,735,758 ($26.7M)

Contractor: CAE USA Inc.

Awarding Agency: Department of Defense

Start Date: 2024-04-01

End Date: 2024-11-30

Contract Duration: 243 days

Daily Burn Rate: $110.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: KIRTLAND, DAVIS-MONTHAN, JOINT BASE ANDREWS, AND MOODY (KDAM) AIRCREW TRAINING AND REHEARSAL SUPPORT (ATARS) COURSEWARE AND INSTRUCTION (C AND I) BRIDGE CONTRACT

Place of Performance

Location: KIRTLAND AFB, BERNALILLO County, NEW MEXICO, 87117

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $26.7 million to CAE USA INC. for work described as: KIRTLAND, DAVIS-MONTHAN, JOINT BASE ANDREWS, AND MOODY (KDAM) AIRCREW TRAINING AND REHEARSAL SUPPORT (ATARS) COURSEWARE AND INSTRUCTION (C AND I) BRIDGE CONTRACT Key points: 1. Contract awarded on a sole-source basis, raising questions about potential price overruns and limited market engagement. 2. The bridge contract's short duration (243 days) suggests a temporary solution, potentially indicating ongoing issues with long-term planning or a pending recompete. 3. Lack of competition limits opportunities for innovation and cost savings that could be realized through a more open bidding process. 4. The contract's focus on aircrew training and rehearsal support is critical for maintaining pilot proficiency and mission readiness. 5. The specific nature of the courseware and instruction may present barriers to entry for new contractors, contributing to the sole-source award. 6. Performance risk appears moderate given the established contractor and the defined scope, but oversight is crucial due to the lack of competition.

Value Assessment

Rating: questionable

The contract's value of $26.7 million for a 243-day period warrants scrutiny, especially given the absence of competitive bidding. Without a benchmark from competing proposals, it is difficult to definitively assess if this price represents fair market value. The firm-fixed-price structure offers some cost certainty, but the sole-source nature means taxpayers are not benefiting from potential price reductions that could arise from a competitive environment. Further analysis would require comparing the scope and deliverables to similar training contracts awarded competitively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning that the Department of the Air Force did not solicit bids from multiple potential offerors. This approach is typically used when only one source is capable of meeting the requirement, or in urgent situations. The lack of competition means that price discovery through market forces was bypassed, potentially leading to a higher cost for the government than if multiple companies had competed.

Taxpayer Impact: Taxpayers may be paying a premium for this training support due to the absence of competitive pressure. The government missed an opportunity to leverage market dynamics to secure the best possible price and value.

Public Impact

Aircrew members across multiple Air Force bases (Kirtland, Davis-Monthan, Joint Base Andrews, and Moody) will benefit from continued training and rehearsal support. Essential courseware and instruction services will be delivered, ensuring pilots maintain critical skills and readiness for various missions. The geographic impact is concentrated at the specified Air Force installations, supporting their operational training requirements. The contract supports the specialized workforce of instructors and training developers employed by CAE USA Inc.

Waste & Efficiency Indicators

Waste Risk Score: 40 / 10

Warning Flags

Sole-source award limits price competition and potential value for taxpayers.
Short contract duration may indicate underlying issues with long-term planning or a pending recompete.
Lack of transparency in the justification for sole-source award.
Potential for contractor lock-in due to specialized nature of training.

Positive Signals

Contract ensures continuity of critical aircrew training and rehearsal support.
Firm-fixed-price contract provides cost certainty for the defined period.
Contractor (CAE USA Inc.) likely possesses specialized expertise in aircrew simulation and training.

Sector Analysis

The Aircrew Training and Rehearsal Support (ATARS) contract falls within the broader aerospace and defense training services sector. This sector is characterized by specialized technology, high barriers to entry, and significant government spending. The market for simulation and training systems is substantial, with major players like CAE USA Inc. often securing long-term contracts due to the complexity and security requirements. Benchmarking this specific contract's value is challenging without competitive data, but the overall spending on defense training services runs into billions annually.

Small Business Impact

This contract does not appear to include a small business set-aside. Given the sole-source nature of the award, there is no indication of subcontracting opportunities for small businesses being mandated or actively pursued through this specific contract vehicle. The focus is on a large, established prime contractor, potentially limiting the direct inclusion of small businesses in this particular effort.

Oversight & Accountability

Oversight for this contract will be managed by the Department of the Air Force. As a sole-source award, the justification and approval process should be thoroughly documented and transparent. Accountability measures will rely on the contract's performance metrics and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected or identified during the contract's performance.

Related Government Programs

Aircrew Training Systems
Simulation and Training
Defense Training Services
Pilot Proficiency Programs
Military Aviation Support

Risk Flags

Sole-source award without clear justification.
Potential lack of competitive pricing.
Short contract duration may indicate instability or planning issues.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.7 million to CAE USA INC.. KIRTLAND, DAVIS-MONTHAN, JOINT BASE ANDREWS, AND MOODY (KDAM) AIRCREW TRAINING AND REHEARSAL SUPPORT (ATARS) COURSEWARE AND INSTRUCTION (C AND I) BRIDGE CONTRACT

Who is the contractor on this award?

The obligated recipient is CAE USA INC..

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 $26.7 million.

What is the period of performance?

Start: 2024-04-01. End: 2024-11-30.

What is the specific justification provided by the Department of the Air Force for awarding this contract on a sole-source basis?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are justified under circumstances such as only one responsible source being available, or in cases of urgent and compelling need. Without the official justification document (e.g., a Justification and Approval or J&A), it is impossible to ascertain the precise reasons. This lack of transparency is a concern, as it prevents a thorough public assessment of why competitive procedures were not utilized, potentially impacting the government's ability to secure the best value.

How does the cost per training hour or per aircrew member compare to similar contracts awarded competitively?

Direct comparison of cost per training hour or per aircrew member is not feasible with the data provided. The contract is a bridge contract with a total value of $26.7 million and a duration of 243 days, but it does not break down costs by specific training units or hours. Furthermore, as this was a sole-source award, there are no competing proposals to establish a market-based benchmark. To perform such a comparison, one would need access to detailed cost breakdowns from this contract and data from similar, competitively awarded training contracts for comparable aircraft or mission types.

What are the key performance indicators (KPIs) and deliverables outlined in this contract, and how will their achievement be measured?

The provided data summary does not detail the specific Key Performance Indicators (KPIs) or deliverables for this Aircrew Training and Rehearsal Support (ATARS) contract. Typically, such contracts would include metrics related to training hours delivered, simulation fidelity, courseware effectiveness, instructor availability, and student pass rates. Measurement of achievement would likely involve regular contractor reporting, government acceptance of training modules, and performance reviews conducted by the contracting officer's representative (COR). The firm-fixed-price nature suggests that the contractor is obligated to deliver the specified courseware and instruction regardless of the actual hours or effort expended.

What is CAE USA Inc.'s track record with the Department of the Air Force, particularly in providing aircrew training and simulation services?

CAE USA Inc. is a well-established provider of simulation and training solutions, and it is highly probable they have a significant track record with the Department of the Air Force and other military branches. Their expertise in developing and delivering complex training systems, including flight simulators and courseware, is widely recognized. While specific contract history details are not in the provided summary, companies of CAE's size and specialization typically hold numerous contracts over many years. Their continued success in securing such contracts suggests a history of satisfactory performance, though each contract's specifics and any past issues would require deeper investigation.

What is the historical spending trend for aircrew training and rehearsal support at these specific bases (KDAM)?

The provided data does not include historical spending trends for aircrew training and rehearsal support at Kirtland, Davis-Monthan, Joint Base Andrews, and Moody (KDAM). To analyze historical spending, one would need access to contract databases that track awards over multiple fiscal years for these specific services and locations. Understanding these trends would help determine if the current $26.7 million award represents an increase, decrease, or stable level of investment in these training capabilities. It would also help identify if previous contracts for similar services were competed or awarded sole-source.

Are there any known risks associated with CAE USA Inc. as a contractor, such as past performance issues or financial instability?

The provided data summary does not indicate any specific risks associated with CAE USA Inc. as a contractor, such as past performance issues or financial instability. However, a comprehensive risk assessment would typically involve reviewing the contractor's performance history on previous government contracts, including any documented deficiencies, disputes, or contract terminations. Financial health assessments are also standard. Without access to these broader performance and financial records, it is assumed, based on the award, that the government has assessed CAE USA Inc. as a responsible contractor capable of fulfilling the contract requirements.

Industry Classification

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

Product/Service Code: EDUCATION AND TRAINING › EDUCATION AND TRAINING 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

Address: 4908 TAMPA WEST BLVD, TAMPA, FL, 33634

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $26,865,605

Exercised Options: $26,865,605

Current Obligation: $26,735,758

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline