SpaceX awarded $30M contract for air transportation services, highlighting rapid deployment capabilities
Contract Overview
Contract Amount: $30,000,000 ($30.0M)
Contractor: Space Exploration Technologies Corp.
Awarding Agency: Department of Defense
Start Date: 2024-06-17
End Date: 2024-08-16
Contract Duration: 60 days
Daily Burn Rate: $500.0K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: SPACEX - CMSI #1
Place of Performance
Location: HAWTHORNE, LOS ANGELES County, CALIFORNIA, 90250
Plain-Language Summary
Department of Defense obligated $30.0 million to SPACE EXPLORATION TECHNOLOGIES CORP. for work described as: SPACEX - CMSI #1 Key points: 1. Contract value of $30 million indicates significant demand for specialized air cargo. 2. Sole provider SpaceX suggests unique capabilities or limited market alternatives for this service. 3. Short performance period (60 days) points to urgent or time-sensitive operational needs. 4. Fixed-price contract structure aims to control costs and provide budget certainty. 5. Air transportation for defense purposes underscores the strategic importance of rapid logistics. 6. Geographic focus on California may relate to launch sites or operational hubs.
Value Assessment
Rating: good
The $30 million contract for air transportation is substantial, but without specific service details or benchmarks, a precise value-for-money assessment is challenging. Given SpaceX's established role in rapid deployment and specialized cargo, the pricing is likely competitive within its niche. However, comparing this to standard freight services is not applicable due to the specialized nature of the cargo and delivery requirements.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. However, the specific number of bidders is not provided. The fact that SpaceX was selected suggests they offered the most advantageous proposal based on technical capabilities, price, or other evaluation factors.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to better pricing and service quality.
Public Impact
The Department of Defense benefits from enhanced logistical capabilities for rapid deployment. Services include nonscheduled chartered freight air transportation, likely for critical or time-sensitive equipment. Geographic impact is centered in California, potentially supporting space launch operations or military installations. Workforce implications are minimal for this specific contract, primarily involving flight crews and logistics personnel.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for limited competition in future similar contracts if SpaceX's unique capabilities become indispensable.
- Dependence on a single provider for critical, time-sensitive logistics could pose a risk if service is interrupted.
Positive Signals
- Demonstrates successful utilization of innovative providers like SpaceX for defense logistics.
- Fixed-price contract provides cost certainty for this specific delivery order.
- Awarding to a company with proven rapid deployment capabilities ensures mission readiness.
Sector Analysis
The air transportation sector is vast, but this contract falls into a specialized niche of chartered freight, likely for high-value or time-sensitive cargo. SpaceX's involvement suggests a focus on rapid, potentially unconventional, delivery methods. Comparable spending benchmarks are difficult to establish without knowing the exact nature of the cargo and delivery urgency, but the $30 million value for a 60-day period indicates a premium service.
Small Business Impact
This contract does not appear to involve small business set-asides, as SpaceX is a large corporation. There is no information provided regarding subcontracting opportunities for small businesses within this specific award.
Oversight & Accountability
The contract is subject to standard federal procurement oversight. As a delivery order under a larger contract vehicle, oversight would focus on adherence to the terms and conditions of the base agreement. Transparency is maintained through federal contract databases. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Air Mobility Command Contracts
- Rapid Global Mobility Services
- Department of Defense Logistics Support
- Space Launch Support Services
Risk Flags
- Potential single-source dependency risk
- Lack of detailed cargo information limits full value assessment
- High cost per day suggests specialized, potentially non-competitive niche
Tags
defense, department-of-defense, air-force, california, delivery-order, full-and-open-competition, firm-fixed-price, freight-transportation, specialized-services, rapid-deployment, spacex
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $30.0 million to SPACE EXPLORATION TECHNOLOGIES CORP.. SPACEX - CMSI #1
Who is the contractor on this award?
The obligated recipient is SPACE EXPLORATION TECHNOLOGIES CORP..
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 $30.0 million.
What is the period of performance?
Start: 2024-06-17. End: 2024-08-16.
What specific type of cargo is being transported under this contract, and why is SpaceX the chosen provider?
The data indicates 'Nonscheduled Chartered Freight Air Transportation' (NAICS 481212). While the exact cargo is not specified, SpaceX's selection suggests the need for rapid, potentially large-volume, or specialized transport that aligns with their unique capabilities, possibly related to space launch components or sensitive military equipment. Their proven track record in rapid deployment and handling of complex payloads likely made them the most suitable provider, even if competition was present.
How does the $30 million value compare to typical air freight contracts for similar durations?
A $30 million contract for a 60-day period is exceptionally high for standard air freight. This suggests the contract is for highly specialized services, such as expedited transport of critical national security assets, large satellite components, or urgent deployment of personnel and equipment to remote or sensitive locations. Standard commercial freight rates would be significantly lower, highlighting the premium associated with SpaceX's capabilities and the likely urgency or unique requirements of the Department of Defense.
What are the potential risks associated with awarding a contract of this magnitude to a single provider like SpaceX?
The primary risk is dependence on a single provider for critical transportation needs. If SpaceX experiences operational issues, technical failures, or changes in service availability, it could significantly disrupt Department of Defense operations. This lack of redundancy could lead to delays, increased costs if alternative solutions must be rapidly sourced, and potential national security implications. Mitigation strategies would involve robust contingency planning and potentially exploring alternative providers for future needs.
What is SpaceX's track record with the Department of Defense, particularly for air transportation services?
SpaceX has a well-established and extensive track record with the Department of Defense, primarily known for its launch services for satellites and payloads. However, their involvement in air transportation, especially for freight, is less publicized but aligns with their capabilities in rapid deployment and logistics. The DoD has previously contracted SpaceX for various missions, including cargo resupply and satellite deployment, demonstrating a level of trust and proven performance in handling critical national security assets.
What does the 'Nonscheduled Chartered Freight Air Transportation' classification imply about the contract's flexibility and urgency?
This classification implies that the flights are not part of a regular, published schedule and are chartered on demand. This points to a high degree of flexibility and urgency, allowing the DoD to request transportation services as needed, rather than adhering to fixed routes or timetables. It suggests the contract is designed to meet unpredictable or rapidly evolving operational requirements, where standard commercial air cargo services might not be agile enough.
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: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 ROCKET RD, HAWTHORNE, CA, 90250
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: $30,000,000
Exercised Options: $30,000,000
Current Obligation: $30,000,000
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA881120D0002
IDV Type: IDC
Timeline
Start Date: 2024-06-17
Current End Date: 2024-08-16
Potential End Date: 2024-08-16 00:00:00
Last Modified: 2024-06-17
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