DoD awards $389M for F110 engine parts, with significant long-term sustainment through 2026
Contract Overview
Contract Amount: $389,318,896 ($389.3M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2020-04-28
End Date: 2026-12-31
Contract Duration: 2,438 days
Daily Burn Rate: $159.7K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: F110 TAIWAN ENGINE COVID-19 DIB
Place of Performance
Location: CINCINNATI, HAMILTON County, OHIO, 45215
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $389.3 million to GENERAL ELECTRIC COMPANY for work described as: F110 TAIWAN ENGINE COVID-19 DIB Key points: 1. Contract value indicates substantial investment in critical aircraft engine components. 2. Sole-source award raises questions about competitive pricing and potential cost efficiencies. 3. Long contract duration suggests a need for sustained supply chain support. 4. Focus on engine parts points to a critical element of aerospace readiness. 5. Geographic concentration in Ohio for manufacturing may have regional economic implications.
Value Assessment
Rating: fair
The contract value of $389 million for aircraft engine parts is significant, but without comparable contract data or detailed cost breakdowns, a precise value-for-money assessment is challenging. The firm-fixed-price structure aims to control costs, but the sole-source nature limits opportunities for price discovery through competition. Benchmarking against similar engine part procurements or historical pricing for the F110 engine would be necessary for a more robust evaluation of its cost-effectiveness.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one bidder, General Electric Company, was considered. This approach is typically used when a specific capability or proprietary technology is required, or in situations where competition is not feasible. The lack of multiple bidders means that the government did not benefit from a competitive bidding process, which could potentially lead to higher prices than if multiple suppliers had vied for the contract.
Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure. Without competing offers, there's less assurance that the price reflects the lowest possible cost for these essential engine parts.
Public Impact
The U.S. Air Force benefits from the sustained availability of critical F110 engine components, ensuring aircraft operational readiness. The contract supports the manufacturing and supply chain for advanced aircraft engines, crucial for national defense. The primary geographic impact is in Ohio, where General Electric Company's manufacturing facilities are located, supporting local jobs and the regional economy. The contract sustains employment within the aerospace manufacturing sector, particularly in specialized engine component production.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition, potentially increasing costs for taxpayers.
- Long-term contract duration (through 2026) may reduce flexibility to adapt to market changes or seek better pricing.
- Lack of transparency on specific part numbers and quantities makes detailed cost analysis difficult.
Positive Signals
- Firm-fixed-price contract provides cost certainty for the government.
- Awarding to General Electric, the original equipment manufacturer, ensures compatibility and quality for critical engine components.
- Long-term nature of the contract ensures sustained supply for essential defense assets.
Sector Analysis
This contract falls within the Aerospace and Defense sector, specifically focusing on aircraft engine manufacturing and parts. The market for such specialized components is often dominated by a few key players due to high barriers to entry, including complex technology, significant R&D investment, and stringent quality requirements. The total addressable market for aircraft engine parts is substantial, driven by military and commercial aviation needs. This contract represents a significant portion of spending dedicated to sustaining a specific engine type within the DoD's inventory.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. Furthermore, the prime contractor, General Electric Company, is a large corporation. While there might be subcontracting opportunities for small businesses within GE's supply chain, the primary award does not directly benefit small businesses through a set-aside. The impact on the small business ecosystem is indirect, depending on GE's subcontracting practices.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Air Force and the Department of Defense's contracting and program management offices. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified parts. Transparency could be enhanced by making more detailed justifications for the sole-source award and cost breakdowns publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- F110 Engine Sustainment Programs
- DoD Aircraft Parts Procurement
- Air Force Engine Maintenance Contracts
- Aerospace Manufacturing Support
Risk Flags
- Sole-source award lacks competitive pricing validation.
- Long contract duration may limit future cost-saving opportunities.
- Limited public data on specific cost components and justification for sole-source.
Tags
defense, department-of-defense, department-of-the-air-force, aircraft-engine-and-engine-parts-manufacturing, firm-fixed-price, sole-source, ohio, large-contract, engine-parts, f110-engine, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $389.3 million to GENERAL ELECTRIC COMPANY. F110 TAIWAN ENGINE COVID-19 DIB
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC 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 $389.3 million.
What is the period of performance?
Start: 2020-04-28. End: 2026-12-31.
What is the historical spending trend for F110 engine parts from General Electric?
Analyzing historical spending on F110 engine parts from General Electric requires access to historical contract databases. Typically, such spending can fluctuate based on operational tempo, fleet size, and the lifecycle of the aircraft utilizing the F110 engine. A review of past contracts would reveal if this $389 million award represents an increase, decrease, or is consistent with previous years' investments. Factors like aging aircraft, upgrades, and depot-level maintenance schedules also influence these spending patterns. Without specific historical data, it's difficult to provide a precise trend, but sustained investment suggests ongoing reliance on this engine platform.
How does the pricing of these F110 engine parts compare to market rates or similar contracts?
A direct comparison of pricing for these F110 engine parts to market rates or similar contracts is challenging without specific part numbers, quantities, and detailed cost breakdowns. As a sole-source award to General Electric, the original equipment manufacturer, the pricing is set through negotiation rather than competitive bidding. To assess value, one would need to benchmark against previous F110 part procurements, other GE engine part contracts, or potentially non-OEM (Original Equipment Manufacturer) parts if available and approved for use. The firm-fixed-price nature provides cost certainty but doesn't inherently guarantee the lowest possible price without competitive benchmarking.
What are the key risks associated with this sole-source contract for F110 engine parts?
The primary risk associated with this sole-source contract is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, General Electric may not have the same incentive to offer the lowest possible price. Another risk is vendor lock-in, where the government becomes heavily reliant on a single supplier, potentially limiting future negotiation leverage or the ability to source parts from alternative, potentially more cost-effective, suppliers. Furthermore, the long duration of the contract could expose the government to risks if market conditions or technological needs change significantly during its term.
What is the expected performance and reliability of the F110 engine parts being procured?
The F110 engine is a well-established and widely used engine in military aviation, powering aircraft such as the F-16 Fighting Falcon and F-15 Eagle. Parts procured under this contract are expected to meet stringent military specifications and performance standards set by the Department of Defense and General Electric. Reliability is critical for flight safety and mission effectiveness. Given that General Electric is the original equipment manufacturer, the parts are likely to be of high quality and designed for optimal performance within the F110 engine system. However, ongoing monitoring of part performance and failure rates would be part of the contract's performance management.
How does this contract contribute to the overall readiness and sustainment of the Air Force's F110-powered fleet?
This $389 million contract is crucial for the sustainment of the Air Force's F110-powered fleet by ensuring a continuous supply of necessary engine parts. The F110 engine is a key component for numerous fighter aircraft, and its operational readiness directly impacts the Air Force's ability to conduct missions. By securing these parts through a long-term contract, the Air Force mitigates the risk of supply chain disruptions and ensures that maintenance and repair activities can proceed without delay. This proactive procurement strategy supports the overall readiness posture and operational availability of these vital combat platforms.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: ENGINES AND TURBINES AND COMPONENT
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 NEUMANN WAY, CINCINNATI, OH, 45215
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $389,318,896
Exercised Options: $389,318,896
Current Obligation: $389,318,896
Subaward Activity
Number of Subawards: 135
Total Subaward Amount: $89,501,650
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA862618D0029
IDV Type: IDC
Timeline
Start Date: 2020-04-28
Current End Date: 2026-12-31
Potential End Date: 2026-12-31 00:00:00
Last Modified: 2025-11-12
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