Boeing awarded $18.8M for Engineering Support Services, extending contract through June 2027

Contract Overview

Contract Amount: $18,765,352 ($18.8M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2025-02-01

End Date: 2027-06-30

Contract Duration: 879 days

Daily Burn Rate: $21.3K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING SUPPORT SERVICES (ESS) DAFCS 20.20

Place of Performance

Location: PHILADELPHIA, PHILADELPHIA County, PENNSYLVANIA, 19141

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $18.8 million to THE BOEING COMPANY for work described as: ENGINEERING SUPPORT SERVICES (ESS) DAFCS 20.20 Key points: 1. Contract awarded to a single, large defense contractor, raising questions about competitive pricing. 2. The cost-plus-fixed-fee structure may incentivize higher costs without strict oversight. 3. Limited competition suggests potential for reduced price discovery and taxpayer value. 4. The contract duration of nearly three years indicates a long-term need for these services. 5. Services are critical for U.S. Special Operations Command, highlighting national security implications. 6. The award is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: fair

The contract's value of $18.8 million over approximately 2.5 years is difficult to benchmark without more detailed service descriptions and comparable contract data. As a cost-plus-fixed-fee award, the final cost is subject to actual expenses incurred plus a predetermined fee, which can sometimes lead to higher overall costs compared to fixed-price contracts if not managed tightly. The lack of competition further complicates a direct value-for-money assessment. However, the services provided are specialized and critical for SOCOM, suggesting a potentially high intrinsic value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a delivery order under an existing contract that was not available for competition. The specific justification for the sole-source nature of the parent IDIQ contract is not detailed here, but it implies that only The Boeing Company was deemed capable of fulfilling the requirements. This lack of competition limits the government's ability to solicit and compare offers from multiple vendors, potentially impacting price negotiation and innovation.

Taxpayer Impact: The absence of a competitive bidding process means taxpayers may not be receiving the lowest possible price for these engineering support services. Without competing offers, there is less pressure on the contractor to offer cost savings.

Public Impact

U.S. Special Operations Command (SOCOM) personnel and assets benefit from enhanced engineering support. Specialized engineering services are delivered to maintain and improve critical operational capabilities. The contract supports operations within the defense sector, contributing to national security objectives. Workforce implications include specialized engineering roles, likely concentrated within The Boeing Company's existing structure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contract type can lead to cost overruns if not rigorously monitored.
Sole-source award limits competitive pressure, potentially increasing costs for taxpayers.
Lack of detailed performance metrics in the provided data makes assessing efficiency challenging.
The specific nature of 'engineering support' is broad and could encompass a wide range of activities, making oversight complex.

Positive Signals

Awarded to a well-established defense contractor with a proven track record in aerospace and defense.
Contract duration of nearly three years suggests a stable, ongoing requirement for critical services.
Services are essential for U.S. Special Operations Command, indicating high strategic importance.
Delivery order structure under an IDIQ allows for flexibility in tasking and management.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically supporting specialized engineering services for military applications. The broader market for aerospace engineering services is substantial, driven by government and commercial demand for aircraft design, modification, and maintenance. The award to Boeing, a major player in this industry, aligns with typical government procurement strategies for complex defense systems. Benchmarking this specific award is challenging without more granular data on the scope of 'engineering support,' but it represents a segment of the larger defense industrial base.

Small Business Impact

The provided data indicates that small business participation is not a primary focus for this specific award (ss: false, sb: false). As a sole-source award to a large prime contractor, there are no explicit small business set-aside requirements mentioned. Subcontracting opportunities for small businesses would depend on Boeing's internal procurement practices and the specific needs of the engineering support services, which are not detailed here. The impact on the small business ecosystem is likely minimal for this particular contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the U.S. Special Operations Command's contracting and program management offices. As a delivery order under an IDIQ, the parent contract likely has established oversight mechanisms. The cost-plus-fixed-fee structure necessitates robust financial oversight to ensure costs are reasonable and allocable. Transparency is dependent on the reporting requirements within the contract and the agency's commitment to public disclosure of contract performance data. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aerospace Engineering Services
Special Operations Forces Support
Defense Contractor Services
Aircraft Parts and Auxiliary Equipment Manufacturing
Cost-Plus-Fixed-Fee Contracts

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Lack of detailed performance metrics
Potential for cost overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.8 million to THE BOEING COMPANY. ENGINEERING SUPPORT SERVICES (ESS) DAFCS 20.20

Who is the contractor on this award?

The obligated recipient is THE BOEING COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (U.S. Special Operations Command).

What is the total obligated amount?

The obligated amount is $18.8 million.

What is the period of performance?

Start: 2025-02-01. End: 2027-06-30.

What is the historical spending pattern for Engineering Support Services (ESS) by the U.S. Special Operations Command?

Analyzing historical spending for ESS by SOCOM requires access to detailed contract databases and budget reports. Generally, SOCOM's spending on support services, including engineering, has been substantial due to the unique and demanding operational requirements of special operations forces. These services often encompass a wide range of activities, from platform sustainment and modification to advanced systems integration and testing. Without specific data on ESS awards, it's difficult to provide precise figures, but it's reasonable to assume a consistent and significant allocation of funds to ensure the readiness and technological superiority of SOCOM assets. Trends may show an increasing reliance on specialized contractor support for complex, cutting-edge technologies.

How does the 'cost plus fixed fee' contract type typically perform in terms of cost control compared to other contract types for similar services?

Cost-plus-fixed-fee (CPFF) contracts are often used when the scope of work is not precisely defined or when there is significant uncertainty in the cost of performance, such as in research and development or complex engineering services. In CPFF contracts, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. While the fee is fixed, the total cost can vary significantly based on actual expenses. Compared to fixed-price contracts, CPFF contracts offer less cost certainty for the government and can incentivize higher spending if not managed with rigorous oversight. However, they provide flexibility and allow contractors to undertake high-risk, innovative projects that might not be feasible under fixed-price arrangements. Value for money is highly dependent on the government's ability to monitor and control costs effectively.

What are the specific engineering support services provided under this contract, and how do they align with SOCOM's mission?

The provided data classifies the contract under NAICS code 336413 ('Other Aircraft Parts and Auxiliary Equipment Manufacturing') and refers to 'ENGINEERING SUPPORT SERVICES (ESS)'. This suggests the services are likely related to the design, development, modification, testing, and sustainment of aircraft and related systems used by U.S. Special Operations Command. SOCOM operates a diverse fleet of specialized aircraft, and maintaining their operational readiness, incorporating new technologies, and ensuring mission effectiveness requires extensive engineering expertise. These services could include systems engineering, avionics integration, structural analysis, performance optimization, and technical support for unique SOCOM platforms, directly contributing to the command's ability to conduct global special operations.

What is The Boeing Company's track record with U.S. Special Operations Command for similar engineering support contracts?

The Boeing Company has a long-standing and extensive relationship with the U.S. military, including SOCOM, providing a wide array of aerospace products and services. Given Boeing's position as a major defense contractor and its expertise in aircraft manufacturing and support, it is highly probable that they have a substantial track record of delivering engineering support services to SOCOM across various platforms. This includes sustainment, upgrades, and specialized modifications for aircraft like the AC-130, MH-47, and MH-60, which are integral to SOCOM operations. Their history likely demonstrates a capacity to handle complex engineering challenges and meet the demanding requirements of special operations missions, although specific contract performance details would require deeper analysis.

Are there any known risks associated with sole-source awards for specialized engineering services in the defense sector?

Yes, sole-source awards for specialized engineering services in the defense sector carry several inherent risks. The primary risk is the lack of price competition, which can lead to inflated costs for the government and taxpayers, as there is no market pressure to drive down prices. Another risk is reduced innovation, as contractors may have less incentive to develop cost-saving or performance-enhancing solutions when they are the only provider. Furthermore, sole-source contracts can create vendor lock-in, making it difficult and costly to switch providers in the future. There's also a potential for complacency or reduced responsiveness from the contractor, as they do not face the threat of losing business to competitors. Robust oversight and negotiation are critical to mitigate these risks.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: H9224117R0006

Pricing Type: COST PLUS FIXED FEE (U)

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: $18,765,352

Exercised Options: $18,765,352

Current Obligation: $18,765,352

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: H9224118D0002

IDV Type: IDC

Timeline