DoD's $12.9M contract for aircraft systems faces scrutiny over limited competition and potential value concerns

Contract Overview

Contract Amount: $12,935,354 ($12.9M)

Contractor: Rockwell Collins, Inc.

Awarding Agency: Department of Defense

Start Date: 2026-01-01

End Date: 2027-06-30

Contract Duration: 545 days

Daily Burn Rate: $23.7K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: THE CAAS V10.2 BUILD IS BASED ON OTHER PREVIOUS CAAS V10.0 BASELINE BUILDS AND ALL RESPECTIVE CAPABILITY MERGES, INCORPORATING CONFIGURATION CHANGES TO ADDRESS HARDWARE OBSOLESCENCE ISSUES AND INTEGRATION NEEDS SPECIFIC TO H-47ER AIRCRAFT FOR FMS.

Place of Performance

Location: CEDAR RAPIDS, LINN County, IOWA, 52498

State: Iowa Government Spending

Plain-Language Summary

Department of Defense obligated $12.9 million to ROCKWELL COLLINS, INC. for work described as: THE CAAS V10.2 BUILD IS BASED ON OTHER PREVIOUS CAAS V10.0 BASELINE BUILDS AND ALL RESPECTIVE CAPABILITY MERGES, INCORPORATING CONFIGURATION CHANGES TO ADDRESS HARDWARE OBSOLESCENCE ISSUES AND INTEGRATION NEEDS SPECIFIC TO H-47ER AIRCRAFT FOR FMS. Key points: 1. The contract's value is substantial, necessitating a close examination of cost-effectiveness. 2. Limited competition raises questions about price discovery and potential overpayment. 3. The reliance on a single source could indicate a lack of market alternatives or strategic sourcing. 4. Performance context is crucial, as the system's effectiveness directly impacts critical aircraft capabilities. 5. This contract falls within the specialized aerospace and defense manufacturing sector. 6. The use of a Cost Plus Fixed Fee (CPFF) contract type requires careful monitoring of costs.

Value Assessment

Rating: questionable

Benchmarking the $12.9 million cost for the CAAS V10.2 build against similar advanced aircraft system development contracts is challenging due to the specialized nature of the H-47ER integration. However, the CPFF structure, while allowing for flexibility, inherently carries a higher risk of cost overruns compared to fixed-price contracts. Without detailed cost breakdowns and performance metrics, it's difficult to definitively assess value for money, but the lack of competition suggests potential for inflated pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This approach is typically used when only one vendor possesses the necessary technical expertise, proprietary technology, or when urgent needs preclude a competitive process. The absence of multiple bidders means there was no direct price comparison, potentially leading to a less favorable price for the government.

Taxpayer Impact: Taxpayers may be paying a premium due to the lack of competitive pressure to drive down costs. The government's negotiating position is weakened without alternative offers.

Public Impact

The primary beneficiaries are U.S. Special Operations Command (SOCOM) and potentially allied nations through Foreign Military Sales (FMS). The contract delivers critical upgrades to the CAAS V10.2 system, enhancing navigation, detection, and guidance capabilities for the H-47ER aircraft. The geographic impact is primarily within the operational theaters of SOCOM, with potential global reach. Workforce implications include specialized engineering and manufacturing roles within Rockwell Collins and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Cost Plus Fixed Fee (CPFF) contract type can incentivize cost growth if not rigorously managed.
Lack of transparency in the sole-source justification requires further review.
Dependence on a single contractor for critical system upgrades poses a long-term risk.
Obsolescence issues addressed suggest a reactive rather than proactive lifecycle management approach.

Positive Signals

Addresses critical hardware obsolescence, ensuring continued operational capability.
Integrates specific capabilities for the H-47ER aircraft, tailoring the system to operational needs.
Leverages existing baseline builds (V10.0), potentially reducing development time and cost compared to a ground-up design.
Contract awarded to a known entity (Rockwell Collins) with established expertise in aerospace systems.

Sector Analysis

This contract falls within the Aerospace and Defense sector, specifically focusing on avionics and mission systems manufacturing. The market for such specialized systems is often characterized by high barriers to entry, significant R&D investment, and a limited number of qualified suppliers. Comparable spending benchmarks are difficult to establish without detailed system specifications, but contracts for similar integrated avionics suites can range from millions to hundreds of millions of dollars depending on complexity and aircraft type.

Small Business Impact

There is no indication of small business set-asides or subcontracting plans associated with this contract. As a sole-source award to a large prime contractor, the direct impact on small businesses is likely minimal unless Rockwell Collins voluntarily engages them in its supply chain. Further investigation into subcontracting opportunities would be needed to assess any potential positive or negative effects on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and program management offices, specifically within U.S. Special Operations Command. The Inspector General's office may conduct audits or investigations into cost, performance, and compliance, particularly given the sole-source nature and CPFF structure. Transparency is limited by the lack of public competition details, but contract modifications and performance reports should be available through official channels.

Related Government Programs

Aircraft Modernization and Sustainment Programs
Avionics Systems Development
Special Operations Forces Equipment Procurement
Foreign Military Sales (FMS) Support
Aerospace Manufacturing Contracts

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Potential for cost overruns
Lack of competitive benchmarking
Addressing hardware obsolescence

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.9 million to ROCKWELL COLLINS, INC.. THE CAAS V10.2 BUILD IS BASED ON OTHER PREVIOUS CAAS V10.0 BASELINE BUILDS AND ALL RESPECTIVE CAPABILITY MERGES, INCORPORATING CONFIGURATION CHANGES TO ADDRESS HARDWARE OBSOLESCENCE ISSUES AND INTEGRATION NEEDS SPECIFIC TO H-47ER AIRCRAFT FOR FMS.

Who is the contractor on this award?

The obligated recipient is ROCKWELL COLLINS, INC..

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 $12.9 million.

What is the period of performance?

Start: 2026-01-01. End: 2027-06-30.

What is Rockwell Collins' track record with similar sole-source sole-award contracts for complex avionics systems?

Rockwell Collins, now part of Collins Aerospace, has a long history of developing and supplying complex avionics and mission systems for military aircraft. While specific data on sole-source awards for similar system builds is not publicly detailed, the company has consistently secured significant contracts, often through competitive processes, for platforms like the C-130 variants, which share some technological lineage with the H-47ER. Their track record generally indicates a strong technical capability, but sole-source awards, by definition, bypass the competitive validation of their pricing and efficiency against alternatives. Audits and performance reviews from previous contracts would be necessary to fully assess their performance in sole-source scenarios.

How does the $12.9 million cost compare to the value delivered for the CAAS V10.2 build on H-47ER aircraft?

Assessing the precise value for $12.9 million is challenging without detailed performance metrics and a breakdown of the specific capabilities being upgraded or integrated. The contract covers "Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing" for the H-47ER. Given the specialized nature of Special Operations Command (SOCOM) requirements and the integration onto a specific aircraft platform, the cost reflects not just the hardware but significant engineering, software development, testing, and certification efforts. However, the sole-source nature means this figure hasn't been tested against market competition, raising concerns that the value delivered might not be the best achievable price.

What are the primary risks associated with a sole-source award for critical aircraft systems?

The primary risks of a sole-source award for critical aircraft systems include inflated pricing due to lack of competition, potential for complacency from the contractor regarding innovation and efficiency, and a reduced government negotiating position. There's also a strategic risk if the sole-source contractor faces financial difficulties or decides to exit the market, leaving the government with limited options for sustainment and future upgrades. For this specific contract, the risk is amplified because it addresses hardware obsolescence, implying a need for ongoing support and potential future modifications, all of which will likely continue under limited competition.

How effective is the CAAS V10.2 system expected to be, and how is its effectiveness measured?

The effectiveness of the CAAS V10.2 system is expected to be high, as it directly addresses "hardward obsolescence issues and integration needs specific to H-47ER aircraft for FMS." This implies the current system is either outdated or not fully optimized for the H-47ER's mission profile. The system's capabilities in search, detection, navigation, and guidance are critical for Special Operations Command (SOCOM) missions, which often operate in complex and high-risk environments. Effectiveness is typically measured through a combination of technical performance specifications (e.g., accuracy, range, reliability), operational testing and evaluation (OT&E) by end-users (SOCOM), and mission success rates. Formal acceptance testing and post-delivery performance monitoring are key measurement tools.

What are the historical spending patterns for CAAS systems or similar avionics upgrades within DoD?

Historical spending on C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance) and avionics systems within the DoD is substantial, often running into billions of dollars annually across various platforms and programs. Specific historical data for the "CAAS V10.2 build" is not readily available in the public domain, as it appears to be a specific iteration or configuration. However, upgrades to existing aircraft systems, especially for specialized platforms like those used by SOCOM, are recurring costs. Contracts for integrated avionics suites can range from tens to hundreds of millions of dollars over the lifecycle of an aircraft program. The $12.9 million for this specific build is a significant but not extraordinary amount for a specialized avionics upgrade, especially considering it addresses obsolescence.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp

Address: 400 COLLINS RD NE, CEDAR RAPIDS, IA, 52498

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: $12,935,354

Exercised Options: $12,935,354

Current Obligation: $12,935,354

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: H9224120D0002

IDV Type: IDC

Timeline