Air Force awards Boeing $80.7M for MOBILE USER OBJECTIVE SYSTEM Service Life Extension Phase 1
Contract Overview
Contract Amount: $80,661,003 ($80.7M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2024-02-02
End Date: 2026-02-01
Contract Duration: 730 days
Daily Burn Rate: $110.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIXED PRICE INCENTIVE
Sector: IT
Official Description: MOBILE USER OBJECTIVE SYSTEM SERVICE LIFE EXTENSION PHASE 1
Place of Performance
Location: EL SEGUNDO, LOS ANGELES County, CALIFORNIA, 90245
Plain-Language Summary
Department of Defense obligated $80.7 million to THE BOEING COMPANY for work described as: MOBILE USER OBJECTIVE SYSTEM SERVICE LIFE EXTENSION PHASE 1 Key points: 1. Significant contract value of $80.7 million for a critical defense system. 2. Boeing, a major defense contractor, holds the award. 3. Potential risks include system obsolescence and the need for ongoing sustainment. 4. The IT sector is heavily involved in modernizing defense capabilities.
Value Assessment
Rating: good
The contract value of $80.7 million for a 2-year service life extension appears reasonable given the complexity of military communication systems. Benchmarking against similar sustainment contracts for large-scale defense platforms would provide further context.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process that should drive price discovery. The use of a Fixed Price Incentive (FPI) contract aims to balance cost control with performance incentives.
Taxpayer Impact: Taxpayer funds are being used for essential defense system modernization, ensuring continued operational capability for the Air Force.
Public Impact
Ensures continued operational capability of a vital military communication system. Supports advanced technology development and sustainment within the defense sector. Contributes to national security by maintaining critical infrastructure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if performance targets are not met under FPI.
- Long-term sustainment costs beyond Phase 1 are not detailed.
- Reliance on a single contractor for critical system life extension.
Positive Signals
- Awarded through full and open competition.
- Focus on extending the life of an existing, critical system.
- Incentive structure aims to control costs and ensure performance.
Sector Analysis
This contract falls within the Engineering Services sector, specifically supporting IT infrastructure for defense. Spending in this area is crucial for maintaining technological superiority and operational readiness for military branches.
Small Business Impact
The data does not indicate any specific provisions or awards to small businesses for this contract. Further analysis would be needed to determine if small businesses are participating as subcontractors.
Oversight & Accountability
The Department of the Air Force is responsible for overseeing this contract. The use of a Fixed Price Incentive contract with defined performance metrics suggests a framework for accountability.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for cost overruns.
- Technological obsolescence.
- Long-term sustainment costs.
- Contractor performance risk.
- System security vulnerabilities.
Tags
engineering-services, department-of-defense, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $80.7 million to THE BOEING COMPANY. MOBILE USER OBJECTIVE SYSTEM SERVICE LIFE EXTENSION PHASE 1
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 $80.7 million.
What is the period of performance?
Start: 2024-02-02. End: 2026-02-01.
What is the projected cost savings or efficiency gain from extending the life of the MOBILE USER OBJECTIVE SYSTEM compared to procuring a new system?
The primary objective of a service life extension is typically to defer the significant capital expenditure associated with procuring a completely new system. While exact figures are not provided, extending the life of the MUOS likely represents a cost-effective strategy, avoiding the R&D, manufacturing, and deployment costs of a replacement. The efficiency gain comes from maintaining current operational capabilities without immediate, massive investment.
What are the key performance metrics tied to the incentive structure of this Fixed Price Incentive contract, and what are the potential penalties for non-performance?
The specific key performance metrics (e.g., system reliability, uptime, specific technical upgrades) and associated incentive targets or penalties are not detailed in the provided data. Fixed Price Incentive contracts usually link contractor profit to achieving specific cost and performance targets. Failure to meet these could result in reduced profit for the contractor or, in severe cases, penalties, though the exact terms are contract-specific.
How does the technological obsolescence risk of the MOBILE USER OBJECTIVE SYSTEM compare to emerging communication technologies, and what is the long-term strategy for MUOS modernization?
Extending the life of the MUOS suggests that while it remains critical, it may be approaching technological obsolescence relative to the very latest advancements. The strategy likely involves incremental upgrades to maintain functionality and security during the extended life. A long-term plan would involve phased replacement or integration with next-generation systems to ensure future communication capabilities remain cutting-edge.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: RESEARCH AND DEVELOPMENT › Space R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: FA880723R0005
Offers Received: 3
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 900 N PACIFIC COAST HWY, EL SEGUNDO, CA, 90245
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $95,309,979
Exercised Options: $80,661,003
Current Obligation: $80,661,003
Subaward Activity
Number of Subawards: 37
Total Subaward Amount: $6,191,576
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2024-02-02
Current End Date: 2026-02-01
Potential End Date: 2026-08-01 00:00:00
Last Modified: 2025-11-26
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