Air Force awards $14.7M R&D contract to Boeing for engine demonstration, spanning over two years
Contract Overview
Contract Amount: $14,700,000 ($14.7M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2019-01-30
End Date: 2025-12-01
Contract Duration: 2,497 days
Daily Burn Rate: $5.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: IGF::OT::IGF BOEING LOCKHEED OR NORTHROP DEMONSTRATION INCLUDING ENGINE
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $14.7 million to THE BOEING COMPANY for work described as: IGF::OT::IGF BOEING LOCKHEED OR NORTHROP DEMONSTRATION INCLUDING ENGINE Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 3. Performance period extends over two years, indicating a medium-term project. 4. The North American Industry Classification System (NAICS) code 541712 points to research and development in physical sciences. 5. The contract is a delivery order under a larger award, implying it's part of an existing framework agreement. 6. The prime contractor, Boeing, has a significant presence in the aerospace and defense sector.
Value Assessment
Rating: fair
Benchmarking the value of this $14.7 million contract is challenging without more detailed cost breakdowns or comparisons to similar engine demonstration projects. The Cost Plus Fixed Fee (CPFF) contract type introduces inherent risk for cost control, as the government pays the contractor's costs plus a fixed fee. While the fixed fee provides some predictability, the total cost can escalate if actual costs exceed estimates. Further analysis would require understanding the specific technical goals and the complexity of the engine demonstration to assess if the awarded amount represents a reasonable investment for the expected outcomes.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. The presence of 3 bidders (no=3) suggests a moderate level of competition for this specific delivery order. While full and open competition is generally preferred for maximizing price discovery and innovation, the actual level of competition can be influenced by the specialized nature of the R&D required and the number of qualified contractors in the market.
Taxpayer Impact: A competitive bidding process like this generally benefits taxpayers by encouraging lower prices and better value. However, the ultimate cost savings depend on the effectiveness of the competition and the government's negotiation strategy.
Public Impact
The primary beneficiary is the Department of the Air Force, which will receive the results of the engine demonstration. The contract supports advancements in aerospace technology, specifically related to engine performance and development. The project is located in Missouri (sn: MISSOURI), potentially impacting the local economy through associated activities. The contract may indirectly benefit the aerospace workforce by supporting R&D activities and potentially leading to future production contracts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type can lead to cost overruns if not closely monitored.
- The duration of the contract (2497 days) is substantial, requiring sustained oversight.
- Specific details of the engine demonstration and its technical risks are not fully elaborated.
- The contract is a delivery order, suggesting it's part of a larger, potentially less scrutinized, basic ordering agreement.
Positive Signals
- Awarded under full and open competition, indicating a robust bidding process.
- The prime contractor, Boeing, is a major defense contractor with extensive experience.
- The contract focuses on Research and Development, aiming to advance technological capabilities.
- The fixed fee component of the CPFF contract provides some cost predictability for the fee portion.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical sciences and engineering related to aerospace propulsion. The market for aerospace R&D is highly specialized, dominated by large defense contractors like Boeing. Spending in this area is critical for maintaining technological superiority and developing next-generation military capabilities. Comparable spending benchmarks would typically involve analyzing other R&D contracts for engine technologies or advanced aerospace systems within the Department of Defense.
Small Business Impact
There is no indication that this contract includes a small business set-aside (sb: false). Given the nature of advanced aerospace engine research and development, it is likely that the prime contractor, Boeing, will subcontract portions of the work. The extent to which small businesses will participate as subcontractors is not specified, but typically, large R&D contracts may involve specialized small businesses for specific components or testing services. Further analysis would be needed to determine the specific subcontracting plan and its impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract will primarily reside with the Department of the Air Force contracting and program management offices. As a Cost Plus Fixed Fee contract, rigorous financial oversight is crucial to monitor incurred costs and ensure the fixed fee is justified. Transparency is facilitated through contract reporting mechanisms. While no specific Inspector General (IG) jurisdiction is mentioned, the Department of Defense's Inspector General typically has broad authority to investigate waste, fraud, and abuse in defense contracts.
Related Government Programs
- Advanced Engine Technology Development Programs
- Aerospace Research and Development Contracts
- Department of Defense Science and Technology Investments
- Air Force Propulsion Systems Research
Risk Flags
- Cost Plus Fixed Fee contract type requires vigilant oversight to manage costs.
- The duration of the contract necessitates long-term monitoring.
- Specific technical details and success metrics are not fully transparent.
- Delivery order under a larger award may indicate less direct competition for this specific task.
Tags
research-and-development, department-of-defense, department-of-the-air-force, cost-plus-fixed-fee, full-and-open-competition, delivery-order, aerospace, missouri, boeing, engine-technology, medium-value
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $14.7 million to THE BOEING COMPANY. IGF::OT::IGF BOEING LOCKHEED OR NORTHROP DEMONSTRATION INCLUDING ENGINE
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 $14.7 million.
What is the period of performance?
Start: 2019-01-30. End: 2025-12-01.
What is Boeing's track record with Cost Plus Fixed Fee (CPFF) contracts, particularly in R&D for the Air Force?
Boeing, as a major defense contractor, has a long history of executing Cost Plus Fixed Fee (CPFF) contracts across various programs for the Department of Defense, including the Air Force. CPFF contracts are common for R&D efforts where the final costs are uncertain. While CPFF contracts offer flexibility for evolving research objectives, they also carry a risk of cost overruns if not managed diligently. Boeing's performance on such contracts typically varies by program complexity, specific technical challenges, and the effectiveness of government oversight. Historical data from sources like the Government Accountability Office (GAO) or DoD Inspector General reports might provide specific instances of cost performance and management challenges or successes on similar Boeing CPFF R&D contracts. Analyzing these past performance metrics would offer insight into their capability to manage this specific engine demonstration project within budgetary expectations.
How does the $14.7 million value compare to similar engine demonstration contracts awarded by the Air Force?
Directly comparing the $14.7 million value of this specific delivery order to similar engine demonstration contracts requires access to detailed contract databases and knowledge of the specific technological scope. Engine demonstration projects can vary significantly in complexity, scale, and objectives, influencing their total cost. For instance, a demonstration focused on incremental improvements to an existing engine might cost less than one involving entirely novel propulsion concepts. Without knowing the precise technical goals and the maturity of the technology being demonstrated, a precise benchmark is difficult. However, generally, R&D contracts of this magnitude for major aerospace components suggest a significant undertaking, likely involving advanced materials, complex simulations, and prototype testing. Further investigation into the NAICS code (541712) and contract description would be needed to identify comparable contracts for a more robust value assessment.
What are the primary technical risks associated with this engine demonstration contract?
The primary technical risks associated with an engine demonstration contract, especially in R&D, often revolve around achieving the desired performance metrics, ensuring reliability and durability of new components or designs, and integrating novel technologies. For this specific contract, risks could include unforeseen challenges in materials science, combustion efficiency, thermal management, or control systems. The success of the demonstration hinges on the contractor's ability to overcome these technical hurdles within the project timeline and budget. The Cost Plus Fixed Fee (CPFF) structure acknowledges some of this inherent R&D risk, but significant technical failures could still lead to delays and increased costs beyond the initial estimates, impacting the overall program objectives and potentially requiring contract modifications or re-competition.
What is the expected program effectiveness or outcome of this engine demonstration?
The expected program effectiveness of this engine demonstration contract is to validate and advance specific aspects of aerospace engine technology for the Department of the Air Force. While the data provided is limited, the R&D focus suggests the outcome will be a better understanding of a particular engine's capabilities, potential improvements in efficiency, performance, or durability, or the successful testing of new design concepts. The ultimate goal is likely to inform future acquisition decisions, potentially leading to upgrades for existing aircraft or the development of new platforms. The success will be measured by whether the demonstration meets its predefined technical objectives, provides actionable data for future development, and contributes to the Air Force's strategic technological goals in aviation.
How has the Air Force's spending on aerospace R&D, particularly engine technology, trended in recent years?
The Air Force's spending on aerospace Research and Development (R&D), including engine technology, has historically been substantial and subject to shifting strategic priorities and budget allocations. In recent years, there has been a continued emphasis on maintaining technological superiority, which drives investment in areas like advanced propulsion systems, hypersonics, and sustainable aviation fuels. Spending trends can fluctuate based on specific program needs, congressional appropriations, and the perceived threat landscape. While this $14.7 million contract represents a specific investment, broader trends indicate a consistent, albeit variable, commitment to R&D in aerospace propulsion to ensure future air dominance and operational effectiveness. Analyzing aggregated spending data for NAICS code 541712 and related defense R&D categories would provide a clearer picture of overall trends.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 325 J S MCDONNELL BLVD, HAZELWOOD, MO, 63042
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: $23,734,875
Exercised Options: $23,734,875
Current Obligation: $14,700,000
Actual Outlays: $486,383
Subaward Activity
Number of Subawards: 26
Total Subaward Amount: $2,897,469
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA865017D2401
IDV Type: IDC
Timeline
Start Date: 2019-01-30
Current End Date: 2025-12-01
Potential End Date: 2025-12-01 00:00:00
Last Modified: 2025-12-03
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