Air Force awards $76.1M for BACN aircraft modification, with limited competition

Contract Overview

Contract Amount: $76,141,660 ($76.1M)

Contractor: Learjet Inc

Awarding Agency: Department of Defense

Start Date: 2021-11-10

End Date: 2026-01-01

Contract Duration: 1,513 days

Daily Burn Rate: $50.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: BATTLEFIELD AIRBORNE COMMUNICATIONS NODE (BACN) GLOBAL 6000 AIRCRAFT

Place of Performance

Location: WICHITA, SEDGWICK County, KANSAS, 67209

State: Kansas Government Spending

Plain-Language Summary

Department of Defense obligated $76.1 million to LEARJET INC for work described as: BATTLEFIELD AIRBORNE COMMUNICATIONS NODE (BACN) GLOBAL 6000 AIRCRAFT Key points: 1. Value for money is difficult to assess due to lack of competition and limited public data. 2. Competition dynamics are heavily skewed towards a sole-source provider, potentially impacting price. 3. Risk indicators include reliance on a single contractor and potential for cost overruns. 4. Performance context is tied to critical battlefield communications, highlighting strategic importance. 5. Sector positioning is within aerospace and defense, a high-value, specialized industry.

Value Assessment

Rating: questionable

Benchmarking the value for money is challenging given the sole-source nature of this award and the specialized equipment involved. The contract's value of $76.1 million for aircraft modification and support suggests a significant investment. Without comparable contract data or a competitive bidding process, it's difficult to definitively assess if this represents a fair market price or optimal value for the taxpayer. The lack of transparency in pricing mechanisms further complicates this assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This approach is typically used when a unique capability or proprietary technology is required, or when only one responsible source exists. The absence of a competitive bidding process limits the government's ability to explore alternative solutions or negotiate the most favorable pricing. This can lead to higher costs compared to a fully competed contract.

Taxpayer Impact: Sole-source awards mean taxpayers may not be receiving the best possible price, as competition is a key driver for cost savings. The government's negotiating power is also reduced in such scenarios.

Public Impact

The primary beneficiaries are the U.S. Air Force and military personnel who rely on the BACN system for critical battlefield communications. The services delivered include modification and sustainment of the BACN Global 6000 aircraft, ensuring operational readiness. The geographic impact is global, supporting deployed forces in various operational theaters. Workforce implications include specialized technical roles in aircraft modification, maintenance, and systems integration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Lack of transparency in pricing makes it difficult to assess value for money.
Reliance on a single contractor could create supply chain risks or vendor lock-in.
Long-term sustainment costs are not fully detailed, posing potential future budget risks.

Positive Signals

Supports a critical military communications capability, enhancing operational effectiveness.
Contract awarded to a known entity (Learjet Inc.), suggesting some level of established capability.
Firm Fixed Price contract type provides some cost certainty for the awarded scope.
Long contract duration (through 2026) allows for sustained support of essential assets.

Sector Analysis

The aerospace and defense sector is characterized by high barriers to entry, significant R&D investment, and stringent regulatory requirements. This contract falls within the aircraft manufacturing and modification sub-sector. The market for specialized military aircraft modifications is often dominated by a few key players due to the technical expertise and security clearances required. Comparable spending benchmarks are difficult to establish without more specific details on the modifications and services provided.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by the 'sb' field being false. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific set-aside goals or reporting requirements, the direct impact on the small business ecosystem for this particular award is likely minimal, though the prime contractor may engage small businesses in their supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. Accountability measures are inherent in the contract terms, particularly the Firm Fixed Price structure, which aims to hold the contractor responsible for delivering within the agreed price. Transparency is limited due to the sole-source nature and the classified or sensitive aspects of military communications systems. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Battlefield Airborne Communications Node (BACN)
Airborne Intelligence, Surveillance, and Reconnaissance (ISR) Platforms
Military Aircraft Modification and Sustainment
Tactical Data Links and Communications Systems

Risk Flags

Sole-source award
Lack of competitive bidding
Limited public data on modifications
Potential for cost overruns without competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $76.1 million to LEARJET INC. BATTLEFIELD AIRBORNE COMMUNICATIONS NODE (BACN) GLOBAL 6000 AIRCRAFT

Who is the contractor on this award?

The obligated recipient is LEARJET INC.

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 $76.1 million.

What is the period of performance?

Start: 2021-11-10. End: 2026-01-01.

What is the specific nature of the modifications being performed on the BACN Global 6000 aircraft?

The provided data does not detail the specific modifications. However, the Battlefield Airborne Communications Node (BACN) program aims to provide a "Wi-Fi"-like network in the sky, extending communications range and interoperability between different military platforms and ground forces. Modifications likely involve integrating advanced communication suites, sensors, and potentially upgrading avionics or structural components to support these systems. The Global 6000 is a large, long-range business jet often used as a platform for sophisticated ISR and communications payloads due to its endurance and space.

How does the $76.1 million cost compare to historical spending on similar BACN aircraft modifications?

Direct historical spending comparisons for this specific modification contract are not publicly available in the provided data. The total contract value of $76.1 million covers the period from November 2021 to January 2026 (approximately 4 years). To assess historical value, one would need to analyze previous BACN modification contracts, considering factors like the scope of work, inflation, and technological advancements. Given the sole-source nature, a direct benchmark against competitive awards is not feasible, making historical context crucial but difficult to obtain externally.

What are the primary risks associated with a sole-source award for critical military assets like the BACN system?

The primary risks of a sole-source award include reduced price competition, potentially leading to higher costs for the government and taxpayers. There's also a risk of vendor lock-in, where the government becomes overly dependent on a single supplier, limiting future flexibility and negotiation power. Furthermore, without competitive pressure, there might be less incentive for the contractor to innovate or optimize performance beyond the contract's minimum requirements. Ensuring adequate oversight and robust contract management becomes even more critical to mitigate these risks.

What is Learjet Inc.'s track record with the BACN program or similar military aircraft modifications?

Learjet Inc., now part of Bombardier Defense, has a long history in aircraft manufacturing and modification. While specific details on their involvement with the BACN program prior to this award are not in the provided data, Learjet aircraft have been utilized in various military and government roles. Their experience with modifying business jets for specialized roles, including communications and surveillance, suggests a relevant capability. A deeper dive into contract databases and defense news would be needed to fully ascertain their specific track record with BACN or comparable complex military modification projects.

How does the 'Aircraft Manufacturing' NAICS code (336411) apply to this contract, given it's a modification and sustainment effort?

The NAICS code 336411, 'Aircraft Manufacturing,' is applied here likely because the contract involves significant modifications that could be considered akin to manufacturing processes, especially if they involve substantial structural changes, integration of new major systems, or assembly of components. While the primary activity might be modification and sustainment of existing airframes, the scale and complexity of integrating advanced communication suites and potentially other systems can blur the lines with manufacturing. This code is often used broadly for work involving the creation or substantial alteration of aircraft.

What are the implications of the 'FIRM FIXED PRICE' contract type for this sole-source award?

A Firm Fixed Price (FFP) contract type means the contractor agrees to a total price for a well-defined scope of work. This shifts most of the risk to the contractor, as they are obligated to complete the work for the agreed-upon price, regardless of their actual costs. For taxpayers, FFP offers cost certainty, as the final price is known upfront. However, in a sole-source scenario, the initial FFP might be set at a higher baseline due to the lack of competition. The government's ability to ensure the price is fair is paramount in such cases.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Bombardier Inc.

Address: 1 LEARJET WAY, WICHITA, KS, 67209

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $76,141,660

Exercised Options: $76,141,660

Current Obligation: $76,141,660

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA872621D0006

IDV Type: IDC

Timeline