DoD Awards $1.73B for Delta IV Heavy Launch Services, Sole-Sourced to United Launch Services
Contract Overview
Contract Amount: $1,728,709,521 ($1.7B)
Contractor: United Launch Services, LLC
Awarding Agency: Department of Defense
Start Date: 2018-10-24
End Date: 2024-11-30
Contract Duration: 2,229 days
Daily Burn Rate: $775.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DELTA IV HEAVY LAUNCH SERVICES
Place of Performance
Location: CENTENNIAL, ARAPAHOE County, COLORADO, 80112
State: Colorado Government Spending
Plain-Language Summary
Department of Defense obligated $1.73 billion to UNITED LAUNCH SERVICES, LLC for work described as: DELTA IV HEAVY LAUNCH SERVICES Key points: 1. Significant contract value for specialized launch services. 2. Sole-source award raises questions about competition and price discovery. 3. Long contract duration (2018-2024) suggests ongoing need. 4. Focus on defense sector highlights critical national security infrastructure.
Value Assessment
Rating: questionable
The contract value of $1.73 billion is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to potential alternatives or previous launch service contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded sole-source, indicating a lack of competition. This method limits price discovery and may result in higher costs for taxpayers compared to a competitively bid contract.
Taxpayer Impact: The sole-source nature of this award means taxpayers may be paying a premium for these launch services, as competitive pressures to lower costs were absent.
Public Impact
Ensures continued access to space for critical national security assets. Supports advanced satellite deployment for intelligence and communication. Potential for cost overruns due to lack of competitive pressure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High contract value
Positive Signals
- Critical national security service
- Long-term service provision
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on launch services for government payloads. Spending in this area is critical for national security and technological advancement, often involving high-value, specialized contracts.
Small Business Impact
There is no indication of small business participation in this sole-source contract. The nature of heavy launch services typically involves large, established prime contractors, potentially limiting opportunities for smaller businesses.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the contractor is delivering services efficiently and at a reasonable cost, despite the absence of competition.
Related Government Programs
- Nonscheduled Chartered Freight Air Transportation
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for cost overruns due to lack of competitive pressure.
- Long-term reliance on a single provider.
- Lack of transparency in pricing justification.
Tags
nonscheduled-chartered-freight-air-trans, department-of-defense, co, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $1.73 billion to UNITED LAUNCH SERVICES, LLC. DELTA IV HEAVY LAUNCH SERVICES
Who is the contractor on this award?
The obligated recipient is UNITED LAUNCH SERVICES, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $1.73 billion.
What is the period of performance?
Start: 2018-10-24. End: 2024-11-30.
What justification was provided for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, critical timing, or lack of viable alternatives. For this contract, the specific justification needs to be reviewed. However, the absence of competition inherently limits price discovery, potentially leading to higher costs than if multiple bidders had vied for the contract, impacting overall value for money.
What are the specific risks associated with relying on a single provider for these critical launch services?
The primary risks include potential price escalation over time, reduced incentive for innovation, and vulnerability to disruptions if the sole provider faces operational issues. Dependence on one entity can also limit flexibility in adapting to new technologies or changing mission requirements, posing a long-term strategic risk.
How is the effectiveness of these launch services being measured and ensured, given the sole-source nature of the contract?
Effectiveness is typically measured through contract performance metrics, on-time delivery, successful payload integration, and mission success rates. The Defense Contract Management Agency (DCMA) likely provides oversight. However, without competitive benchmarks, assessing true effectiveness against potential alternatives is challenging.
Industry Classification
NAICS: Transportation and Warehousing › Nonscheduled Air Transportation › Nonscheduled Chartered Freight Air Transportation
Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: United Launch Alliance, L.L.C
Address: 9501 E PANORAMA CIR, CENTENNIAL, CO, 80112
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $1,728,709,521
Exercised Options: $1,728,709,521
Current Obligation: $1,728,709,521
Subaward Activity
Number of Subawards: 123
Total Subaward Amount: $4,523,320,439
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2018-10-24
Current End Date: 2024-11-30
Potential End Date: 2024-11-30 00:00:00
Last Modified: 2025-07-24
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