DoD's $54M C-40B Aircraft Lease: Boeing Awarded Full & Open Contract
Contract Overview
Contract Amount: $54,000,000 ($54.0M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2009-12-01
End Date: 2010-08-20
Contract Duration: 262 days
Daily Burn Rate: $206.1K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: C-40B PROCUREMENT OF LEASED AIRCRAFT
Place of Performance
Location: TUKWILA, KING County, WASHINGTON, 98108
Plain-Language Summary
Department of Defense obligated $54.0 million to THE BOEING COMPANY for work described as: C-40B PROCUREMENT OF LEASED AIRCRAFT Key points: 1. The contract value is $54 million, awarded to The Boeing Company. 2. Competition was full and open after exclusion of sources, indicating a competitive process. 3. The contract is for leased aircraft, suggesting operational rather than outright purchase. 4. The sector is Aircraft Manufacturing, a key component of defense spending.
Value Assessment
Rating: fair
The contract value of $54 million for leased aircraft needs comparison to similar lease agreements for C-40B or comparable aircraft to assess value. Without specific per-unit lease costs or duration, a precise pricing assessment is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'. This suggests that while competition was sought, specific sources may have been initially excluded, potentially impacting the breadth of price discovery.
Taxpayer Impact: The $54 million expenditure represents taxpayer funds allocated for defense operational needs. The effectiveness of the competition method in securing the best possible price for the lease is a key factor in taxpayer impact.
Public Impact
Leasing aircraft instead of purchasing can offer flexibility but may be more expensive long-term. The Department of Defense's reliance on leased assets impacts its long-term fleet management and capital expenditure. The specific aircraft model (C-40B) and its role within the Air Force's operations are critical to understanding the necessity of this lease.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lease vs. purchase long-term cost analysis
- Impact of 'exclusion of sources' on competition
- Specific operational need for C-40B lease
Positive Signals
- Full and open competition was utilized
- Contract awarded to a major aerospace manufacturer
Sector Analysis
The contract falls within the Aircraft Manufacturing sector, specifically for leased aircraft. Defense spending in this area is substantial, and benchmarks for aircraft leasing costs are essential for evaluating value.
Small Business Impact
The contract was awarded to The Boeing Company, a large prime contractor. There is no explicit indication of small business participation in this specific award, suggesting potential missed opportunities for SMB engagement.
Oversight & Accountability
The contract's duration of 262 days (approximately 8.6 months) suggests a short-term operational need. Oversight would focus on the justification for leasing versus purchasing and the efficiency of the procurement process.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for higher long-term costs due to leasing
- Limited competition due to source exclusion
- Lack of transparency on specific operational need
- No clear small business participation
Tags
aircraft-manufacturing, department-of-defense, wa, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $54.0 million to THE BOEING COMPANY. C-40B PROCUREMENT OF LEASED AIRCRAFT
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
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 $54.0 million.
What is the period of performance?
Start: 2009-12-01. End: 2010-08-20.
What is the cost-effectiveness of leasing the C-40B aircraft compared to purchasing or utilizing alternative assets for the specified operational period?
Assessing the cost-effectiveness requires a detailed breakdown of the lease terms, including maintenance, insurance, and operational support, compared against the total cost of ownership for purchasing a similar aircraft or utilizing alternative transportation methods. Without this granular data, it's difficult to definitively state if leasing was the most economical choice for the 262-day period.
How did the 'exclusion of sources' in the full and open competition potentially affect the final lease price and the range of available options?
Excluding specific sources, even within a full and open competition framework, can limit the competitive landscape. This might have reduced the number of bids received, potentially leading to a higher price than if all potential suppliers had been included. It raises questions about the justification for the exclusion and its impact on achieving the best value for the government.
What specific operational requirements necessitated the lease of C-40B aircraft for a limited duration, and how effective was this lease in meeting those needs?
The limited duration (262 days) suggests a temporary surge in demand, a gap in fleet availability, or a specific mission requirement. Understanding these underlying needs is crucial to evaluating the effectiveness of the lease. If the lease successfully fulfilled the operational gap without compromising mission readiness, it could be deemed effective, despite potential cost considerations.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 7755 E MARGINAL WAY S, SEATTLE, WA, 07
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $54,000,000
Exercised Options: $54,000,000
Current Obligation: $54,000,000
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2009-12-01
Current End Date: 2010-08-20
Potential End Date: 2010-08-20 00:00:00
Last Modified: 2010-10-14
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