DoD Awards Boeing $241M for JDAM Lot 16 Production, Exercising Option
Contract Overview
Contract Amount: $241,077,885 ($241.1M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2011-11-30
End Date: 2014-09-30
Contract Duration: 1,035 days
Daily Burn Rate: $232.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST NO FEE
Sector: Defense
Official Description: JDAM LOT 16 PRODUCTION, OPTION EXERCISED
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $241.1 million to THE BOEING COMPANY for work described as: JDAM LOT 16 PRODUCTION, OPTION EXERCISED Key points: 1. Significant contract value awarded to a single, established defense contractor. 2. Sole-source award raises questions about price discovery and competition. 3. Potential for cost overruns or inefficiencies due to lack of competitive pressure. 4. Focus on critical munitions production for the Air Force.
Value Assessment
Rating: fair
The contract value of $241M for JDAM production is substantial. Without competitive bidding, it's difficult to assess if this price represents fair value compared to potential market alternatives. The 'COST NO FEE' (Cost-Reimbursement) contract type can sometimes lead to higher costs if not managed tightly.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This limits price discovery and may result in higher costs for taxpayers compared to a competitive procurement. The rationale for the sole-source award is not provided.
Taxpayer Impact: The lack of competition in this sole-source award means taxpayers may be paying a premium for these munitions, as there was no market pressure to drive down costs.
Public Impact
Ensures continued production of critical Joint Direct Attack Munitions (JDAMs) for the U.S. Air Force. Supports national defense capabilities by maintaining a supply of precision-guided munitions. Potential impact on the defense industrial base through continued reliance on a single supplier for this specific component.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Cost-reimbursement contract type can incentivize higher spending.
- Lack of transparency on the justification for sole-sourcing.
Positive Signals
- Ensures continued availability of critical munitions.
- Award to an established prime contractor with proven production capabilities.
Sector Analysis
This contract falls within the Defense sector, specifically in the manufacturing of guidance systems for munitions. Defense spending benchmarks for similar complex weapon systems can vary widely, but large sole-source awards for established platforms often warrant scrutiny regarding cost-effectiveness.
Small Business Impact
The contract was awarded to The Boeing Company, a large prime contractor. There is no indication that small businesses were significantly involved in this specific procurement action, either as subcontractors or direct awardees. Further analysis would be needed to determine subcontracting opportunities.
Oversight & Accountability
The 'MO' (Missouri) and 'ST' (State) codes indicate the contract was administered in Missouri. Oversight would typically involve contract management by the Air Force contracting office responsible for this award, focusing on cost tracking and delivery schedules for the JDAM production.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award
- Cost-reimbursement contract type
- Lack of competition
- Potential for uncompetitive pricing
- Limited transparency on justification
Tags
search-detection-navigation-guidance-aer, department-of-defense, mo, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $241.1 million to THE BOEING COMPANY. JDAM LOT 16 PRODUCTION, OPTION EXERCISED
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 $241.1 million.
What is the period of performance?
Start: 2011-11-30. End: 2014-09-30.
What was the specific justification for awarding this JDAM production lot as a sole-source contract instead of pursuing a competitive bidding process?
The provided data does not specify the justification for the sole-source award. Typically, sole-sourcing is employed when only one responsible source can provide the required supplies or services, such as in cases of urgent need, unique capabilities, or when follow-on work is required from the original manufacturer. Without this information, it's impossible to fully assess the necessity of this procurement approach.
How does the unit cost of these JDAMs compare to previous lots or similar munitions procured competitively?
The data provided does not include unit cost breakdowns or historical pricing for comparison. Given this is a sole-source, cost-reimbursement contract, a detailed cost analysis by the government would be crucial to ensure the pricing is reasonable and reflects fair value. Benchmarking against industry standards or previous competitive procurements would be necessary for a thorough assessment.
What are the potential risks associated with relying on a sole-source provider for critical munitions like JDAMs?
The primary risks include a lack of competitive pressure leading to potentially inflated costs, reduced innovation, and a lack of flexibility in adapting to changing requirements or technological advancements. Furthermore, over-reliance on a single supplier can create vulnerabilities in the supply chain and reduce overall national security resilience if that supplier faces production issues or business disruptions.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST NO FEE (S)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JS MCDONNELL BLVD, SAINT LOUIS, MO, 63134
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: $241,077,885
Exercised Options: $241,077,885
Current Obligation: $241,077,885
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2011-11-30
Current End Date: 2014-09-30
Potential End Date: 2014-09-30 00:00:00
Last Modified: 2016-10-11
More Contracts from THE Boeing Company
- KC-X Modernization Program — $32.0B (Department of Defense)
- International Space Station — $22.4B (National Aeronautics and Space Administration)
- 200112!000108!9700!ZD60 !ballistic Missile Defense ORG. !HQ000601C0001 !A!N!*!N! !20001222!20080930!848025649!848025649!009256819!n!the Boeing Company !3370 E Miraloma AVE !anaheim !ca!92806!37000!089!01!huntsville !madison !alabama !+000383571022!n!n!000000000000!ad93!rdte/Other Defense-Adv Tech DEV !S1 !services !1caa!ballistic Missile Defense SYS !541710!*!*!3! ! ! !*!*!*!B!*!*!A! !A !U!R!2!001!B! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! — $18.8B (Department of Defense)
- USN P-8A FRP II Long Lead Material — $18.1B (Department of Defense)
- 200512!010860!2100!w56hzv!tacom - Warren !w56hzv05c0724 !A!N! !Y! ! !20050923!20141231!016544780!016544780!009256819!n!the Boeing Company !J S Mcdonnell Blvd !saint Louis !mo!63166!65000!510!29!st. Louis !ST. Louis (city) !missouri !+000219245691!n!n!000000000000!az15!rdte/Other Research&development-Eng/Manuf Devel !S1 !services !301 !FCS !541330!E! !1! ! ! ! ! !20200930!B! ! !A! !d!u!u!1!001!n!1a!z!y!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! TAS::21 2040::TAS — $12.7B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)