Boeing Awarded $21.7M for JDAM/LJDAM FMS Requirement, No Competition
Contract Overview
Contract Amount: $21,731,982 ($21.7M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2024-05-29
End Date: 2026-02-28
Contract Duration: 640 days
Daily Burn Rate: $34.0K/day
Competition Type: NOT COMPETED
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: LOT 28 JDAM/LJDAM FMS REQUIREMENT MULTIPLE COUNTRIES
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $21.7 million to THE BOEING COMPANY for work described as: LOT 28 JDAM/LJDAM FMS REQUIREMENT MULTIPLE COUNTRIES Key points: 1. Significant contract value for munitions, impacting foreign military sales. 2. Sole-source award to Boeing raises questions about price discovery. 3. Risk of inflated costs due to lack of competitive bidding. 4. Sector focus on defense manufacturing, specifically ammunition.
Value Assessment
Rating: questionable
The contract's fixed-price incentive structure aims to control costs, but the absence of competition makes it difficult to benchmark against similar contracts. Without competitive bids, it's hard to ascertain if the $21.7 million price reflects fair market value.
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 potentially leads to higher costs for the government and allied nations.
Taxpayer Impact: Taxpayer funds are used for foreign military sales, and the lack of competition may result in a less favorable price than could be achieved through a competitive process.
Public Impact
Impacts allied nations through foreign military sales of critical munitions. Supports the defense industrial base and Boeing's manufacturing capabilities. Potential for increased defense spending without demonstrated cost savings.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
Positive Signals
- Supports foreign military sales
- Utilizes established defense contractor
Sector Analysis
This contract falls within the defense sector, specifically ammunition manufacturing. Spending benchmarks for similar sole-source munitions contracts are difficult to establish due to the nature of such awards, but competition typically drives down prices.
Small Business Impact
This contract was awarded to a large prime contractor, The Boeing Company. There is no indication of subcontracting opportunities for small businesses within the provided data.
Oversight & Accountability
The Department of the Air Force awarded this contract. Oversight will be crucial to ensure the fixed-price incentive structure effectively manages costs, especially given the sole-source nature of the award.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award
- Lack of competition
- Potential for cost inflation
- Limited transparency in pricing
- Reliance on a single supplier
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, mo, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $21.7 million to THE BOEING COMPANY. LOT 28 JDAM/LJDAM FMS REQUIREMENT MULTIPLE COUNTRIES
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 $21.7 million.
What is the period of performance?
Start: 2024-05-29. End: 2026-02-28.
What is the justification for awarding this contract sole-source, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities or urgent needs. Without further details, it's presumed the Air Force has determined Boeing is the only viable source. Robust oversight and negotiation are critical to ensure fair pricing, especially when competitive benchmarks are absent. The fixed-price incentive contract type suggests an effort to share risk and reward cost control.
What is the risk associated with procuring munitions through sole-source contracts for foreign military sales?
The primary risk is paying a premium due to the lack of competition, which can strain defense budgets and reduce the purchasing power for allied nations. It also limits opportunities for other capable manufacturers to enter the market or offer competitive alternatives. This can lead to long-term reliance on a single supplier, potentially impacting supply chain resilience and innovation.
How effective is the fixed-price incentive contract type in managing costs for sole-source defense procurements like this one?
A fixed-price incentive (FPI) contract aims to control costs by establishing a target cost, target profit, and a price ceiling. The contractor shares in any savings below the target cost and in any cost overruns above the target cost, up to the ceiling. While FPI can incentivize cost control, its effectiveness in a sole-source scenario is diminished without a competitive baseline to establish realistic target costs and ensure overall value for money.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JAMES S 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: $21,731,982
Exercised Options: $21,731,982
Current Obligation: $21,731,982
Subaward Activity
Number of Subawards: 16
Total Subaward Amount: $18,755,963
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA821324DB002
IDV Type: IDC
Timeline
Start Date: 2024-05-29
Current End Date: 2026-02-28
Potential End Date: 2026-02-28 00:00:00
Last Modified: 2025-03-03
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