DoD Awards Boeing $517M for MH-47G Block II Production, Raising Concerns Over Competition
Contract Overview
Contract Amount: $517,170,127 ($517.2M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2020-01-30
End Date: 2027-03-11
Contract Duration: 2,597 days
Daily Burn Rate: $199.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MH-47G BLKII LOT 4 PRODUCTION
Place of Performance
Location: RIDLEY PARK, DELAWARE County, PENNSYLVANIA, 19078
Plain-Language Summary
Department of Defense obligated $517.2 million to THE BOEING COMPANY for work described as: MH-47G BLKII LOT 4 PRODUCTION Key points: 1. Significant contract value of $517M awarded to a single large business. 2. Lack of competition raises questions about price discovery and potential overspending. 3. The contract is for critical MH-47G Block II aircraft production, vital for special operations. 4. Sector analysis indicates high spending in Defense Aircraft Manufacturing, but this specific award lacks transparency.
Value Assessment
Rating: questionable
The contract value of $517M for 1 MH-47G Block II is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to similar aircraft production contracts or historical data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This limits price discovery and may result in a higher cost to the government than if multiple bidders were involved.
Taxpayer Impact: The lack of competition for this large contract could lead to taxpayers paying a premium for the MH-47G Block II aircraft.
Public Impact
Special operations forces rely on the MH-47G Chinook for critical missions. The award impacts the defense industrial base, specifically aircraft manufacturing. Taxpayers may be overpaying due to the absence of competitive bidding. Long-term sustainment and upgrade costs for these aircraft are not detailed here.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- High contract value
Positive Signals
- Essential aircraft for special operations
- Award to established prime contractor
Sector Analysis
This contract falls within the Defense sector, specifically Aircraft Manufacturing. Spending in this area is consistently high due to the complex and critical nature of military aviation. Benchmarks for sole-source aircraft production are difficult to establish without comparative data.
Small Business Impact
This contract was awarded to a large business (The Boeing Company) and does not indicate any specific set-asides or subcontracting goals for small businesses. The absence of small business participation in such a large sole-source award is notable.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, oversees this award. However, the sole-source nature raises questions about the effectiveness of oversight in ensuring the best value for taxpayer dollars.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency in pricing
- No small business participation noted
- Long-term sustainment costs unknown
Tags
aircraft-manufacturing, department-of-defense, pa, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $517.2 million to THE BOEING COMPANY. MH-47G BLKII LOT 4 PRODUCTION
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $517.2 million.
What is the period of performance?
Start: 2020-01-30. End: 2027-03-11.
What is the justification for awarding this contract sole-source, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or the unavailability of other sources. Without specific documentation, it's presumed the DoD has determined Boeing is the only viable provider. However, the process for ensuring fair and reasonable pricing in sole-source contracts often relies on historical pricing, cost analysis, and negotiation, which may not yield the same savings as a competitive environment.
What are the potential risks associated with a sole-source award for critical aircraft production?
The primary risk of a sole-source award is the potential for inflated costs due to the lack of competitive pressure. This can lead to inefficient use of taxpayer funds. Additionally, it can foster vendor lock-in, reduce innovation, and create dependency on a single supplier, which could be problematic if the supplier faces production issues or financial instability.
How does this contract contribute to the overall effectiveness of special operations forces?
The MH-47G Block II is a specialized variant of the Chinook helicopter, crucial for U.S. Special Operations Command (SOCOM) missions. These aircraft provide unique capabilities for long-range, heavy-lift, and insertion/extraction operations in high-risk environments. Ensuring their continued production and availability is vital for maintaining the operational effectiveness of these elite forces.
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
Offers Received: 1
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: $562,370,127
Exercised Options: $517,170,127
Current Obligation: $517,170,127
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W9121516G0001
IDV Type: BOA
Timeline
Start Date: 2020-01-30
Current End Date: 2027-03-11
Potential End Date: 2027-03-11 00:00:00
Last Modified: 2026-04-06
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