DoD's UH-1N Helicopter Replacement Contract Awarded to Boeing for $1.3 Billion
Contract Overview
Contract Amount: $1,296,742,309 ($1.3B)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2018-09-24
End Date: 2025-12-31
Contract Duration: 2,655 days
Daily Burn Rate: $488.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: UH-1N REPLACEMENT HELICOPTER SYSTEM
Place of Performance
Location: RIDLEY PARK, DELAWARE County, PENNSYLVANIA, 19078
Plain-Language Summary
Department of Defense obligated $1.30 billion to THE BOEING COMPANY for work described as: UH-1N REPLACEMENT HELICOPTER SYSTEM Key points: 1. The contract aims to replace aging UH-1N helicopters, a critical asset for the Air Force. 2. Boeing secured the award, indicating strong competition in the aircraft manufacturing sector. 3. The firm-fixed-price contract structure aims to control costs, but potential risks remain. 4. This procurement falls under the 'Aircraft Manufacturing' sector, a significant area of government spending.
Value Assessment
Rating: good
The total award value of $1.3 billion for 488,415 units appears reasonable given the complexity and specialized nature of military aircraft. Benchmarking against similar large-scale defense procurements suggests this pricing is within expected ranges.
Cost Per Unit: $2655.00
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a robust price discovery process. This method typically leads to more competitive pricing as multiple bidders vie for the contract.
Taxpayer Impact: The competitive bidding process is expected to yield a fair price, minimizing unnecessary taxpayer expenditure on essential defense equipment.
Public Impact
Modernization of critical Air Force transport and utility helicopter capabilities. Potential for job creation in the aerospace manufacturing sector. Ensures continued operational readiness for various military missions. Impact on the supply chain for specialized aircraft components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if unforeseen technical challenges arise.
- Dependence on a single supplier (Boeing) for critical components.
- Long-term sustainment and maintenance costs not fully detailed.
Positive Signals
- Awarded through full and open competition, maximizing value.
- Firm-fixed-price contract provides cost certainty.
- Modernization addresses critical operational needs.
Sector Analysis
This procurement is within the broader 'Aircraft Manufacturing' sector, which is a substantial component of the Department of Defense's budget. Spending in this area is driven by the need for advanced technological capabilities and fleet modernization.
Small Business Impact
While the primary contractor is Boeing, the contract likely involves numerous subcontracts. The extent to which small businesses will participate in the supply chain for this helicopter system is not explicitly detailed but is a common practice in large defense contracts.
Oversight & Accountability
The Department of the Air Force is responsible for overseeing this contract. Robust oversight will be crucial to ensure adherence to specifications, timelines, and budget, particularly given the long duration and significant value.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for schedule delays due to complex manufacturing processes.
- Risk of scope creep if additional requirements are added post-award.
- Vulnerability to supply chain disruptions for specialized components.
- Long-term sustainment costs may exceed initial projections.
Tags
aircraft-manufacturing, department-of-defense, pa, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $1.30 billion to THE BOEING COMPANY. UH-1N REPLACEMENT HELICOPTER SYSTEM
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 $1.30 billion.
What is the period of performance?
Start: 2018-09-24. End: 2025-12-31.
What is the projected lifespan and operational capability of the new UH-1N replacement helicopters compared to the current fleet?
The new helicopters are expected to have a significantly longer operational lifespan, likely 20-30 years, and incorporate advanced avionics, improved performance, and enhanced safety features. This modernization aims to address the obsolescence of the current UH-1N fleet, which has been in service for decades, thereby improving mission effectiveness and reducing maintenance burdens.
What are the key performance metrics and reliability targets for the replacement helicopters, and how will they be measured?
Key performance metrics will likely include speed, range, payload capacity, and survivability in various operational environments. Reliability targets will focus on mean time between failures (MTBF) and overall availability rates. Performance will be measured through rigorous testing and evaluation phases, including flight demonstrations and operational assessments, with penalties or incentives tied to meeting or exceeding these benchmarks.
How does the total lifecycle cost of this new system compare to continuing to operate and maintain the existing UH-1N fleet?
While the initial procurement cost is substantial, the total lifecycle cost is anticipated to be favorable due to reduced maintenance, fewer unscheduled repairs, and improved fuel efficiency of the new platform. The aging UH-1N fleet incurs escalating sustainment costs. A comprehensive lifecycle cost analysis would have been conducted prior to award, factoring in acquisition, operations, sustainment, and eventual disposal.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: FA862917R2507
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: ROUTE 291 & STEWART AVE, RIDLEY PARK, PA, 19078
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: $3,316,136,744
Exercised Options: $1,387,939,608
Current Obligation: $1,296,742,309
Actual Outlays: $22,053,018
Subaward Activity
Number of Subawards: 524
Total Subaward Amount: $766,635,416
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-09-24
Current End Date: 2025-12-31
Potential End Date: 2030-12-31 00:00:00
Last Modified: 2026-01-14
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