Boeing's $90M R&D contract for nanotechnology research shows long-term investment in advanced defense capabilities
Contract Overview
Contract Amount: $89,894,852 ($89.9M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2017-12-08
End Date: 2022-05-31
Contract Duration: 1,635 days
Daily Burn Rate: $55.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: IGF::CT::IGF BASELINE ENGINEERING
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35824
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $89.9 million to THE BOEING COMPANY for work described as: IGF::CT::IGF BASELINE ENGINEERING Key points: 1. Contract awarded for advanced research and development in nanotechnology, a critical emerging technology. 2. Long contract duration of over 4 years suggests a complex, multi-phase research project. 3. Awarded under full and open competition, indicating a broad market search for the best solution. 4. Cost-plus-fixed-fee contract type allows for flexibility in research but requires careful cost oversight. 5. The contract's value is substantial, reflecting the high cost and specialized nature of advanced R&D. 6. Focus on nanotechnology positions the Department of Defense to leverage future technological advancements.
Value Assessment
Rating: good
The contract value of approximately $90 million over more than four years for specialized R&D in nanotechnology appears reasonable given the cutting-edge nature of the work. Benchmarking against similar large-scale, long-term R&D contracts in advanced materials and defense technologies suggests that this level of investment is typical for developing foundational capabilities. The cost-plus-fixed-fee structure, while common for R&D, necessitates diligent oversight to ensure costs remain aligned with project milestones and objectives.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. The presence of 3 bidders, as indicated, suggests a competitive environment for this specialized R&D requirement. This level of competition is generally favorable for price discovery and ensures the government can select the offeror with the best combination of technical merit and cost.
Taxpayer Impact: Full and open competition helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces and selecting the most capable contractor.
Public Impact
The Department of Defense benefits from advancements in nanotechnology, potentially leading to enhanced military capabilities. Research and development in nanotechnology can spur innovation in materials science, electronics, and other critical fields. The contract supports specialized scientific and engineering jobs within the contractor's organization. Geographic impact is primarily concentrated in Alabama, where the contract is managed and potentially where research activities are conducted.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can lead to cost overruns if not managed rigorously.
- Long-term R&D projects carry inherent risks of technological feasibility and market relevance.
- The specialized nature of nanotechnology may limit the pool of truly competitive bidders in the future.
Positive Signals
- Awarded through full and open competition, indicating a robust market search.
- Focus on a critical emerging technology (nanotechnology) aligns with future defense needs.
- The contract duration suggests a commitment to developing deep expertise and capabilities.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on nanotechnology (NAICS 541713). The market for advanced materials and nanotechnology R&D is characterized by high specialization, significant investment, and close ties to government funding, particularly in defense. Comparable spending benchmarks for advanced R&D in defense often run into tens or hundreds of millions of dollars, reflecting the complexity and long-term nature of developing next-generation technologies.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (sb=false) and there is no indication of small business subcontracting requirements (ss=false). This suggests that the primary contractor, The Boeing Company, is expected to perform the majority of the work, and the specialized nature of nanotechnology R&D may not lend itself to extensive subcontracting with small businesses in this instance. Further analysis would be needed to determine if any small business participation was encouraged or occurred organically.
Oversight & Accountability
The Defense Contract Management Agency (DCMA) is responsible for contract administration, which includes oversight of performance, cost, and schedule. As a cost-plus-fixed-fee contract, rigorous financial oversight is crucial to ensure that costs are reasonable and allocable to the contract. The Inspector General's office within the Department of Defense would have jurisdiction over any potential fraud, waste, or abuse related to this contract.
Related Government Programs
- Department of Defense Research and Development Programs
- Advanced Materials Research Contracts
- Nanotechnology Research Initiatives
- Defense Science and Technology Investments
Risk Flags
- Long-term R&D contracts carry inherent uncertainty in achieving desired outcomes.
- Cost-plus-fixed-fee contracts require diligent oversight to manage costs effectively.
- The specialized nature of nanotechnology may limit future competition.
Tags
research-and-development, nanotechnology, department-of-defense, alabama, definitive-contract, cost-plus-fixed-fee, full-and-open-competition, large-contract, advanced-technology, defense-contract-management-agency
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $89.9 million to THE BOEING COMPANY. IGF::CT::IGF BASELINE ENGINEERING
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 $89.9 million.
What is the period of performance?
Start: 2017-12-08. End: 2022-05-31.
What is the track record of The Boeing Company in managing large-scale, long-term research and development contracts, particularly in advanced technologies?
The Boeing Company has a long and extensive history of managing complex, large-scale research and development contracts for the Department of Defense and other government agencies. They are a major defense contractor with significant expertise in aerospace, defense systems, and advanced technologies. Their track record includes numerous R&D programs that have led to the development of cutting-edge military platforms and systems. While specific performance metrics for this particular nanotechnology contract are not detailed in the provided data, Boeing's overall experience suggests a strong capability to handle such specialized and long-duration R&D efforts. However, as with any large contractor, there can be instances of cost overruns or schedule delays on specific projects, necessitating ongoing oversight.
How does the value of this contract compare to other nanotechnology R&D investments by the federal government?
The $89.9 million value of this contract for nanotechnology R&D is substantial and falls within the typical range for significant, multi-year research initiatives in emerging technologies. Federal agencies, including DoD, DARPA, NSF, and DOE, invest billions annually in R&D across various scientific disciplines. Nanotechnology is a priority area, and contracts of this magnitude are common for projects aiming to develop foundational capabilities or explore novel applications with long-term strategic importance. For instance, major materials science or advanced manufacturing R&D programs can easily exceed this amount. Without a direct comparison to other specific nanotechnology R&D contracts from the same period, it's difficult to provide a precise benchmark, but the value indicates a significant commitment to advancing this field.
What are the primary risks associated with this cost-plus-fixed-fee contract type for advanced R&D?
The primary risks associated with a Cost-Plus-Fixed-Fee (CPFF) contract for advanced R&D, like this one, revolve around cost control and scope definition. For the government, the risk is that the actual costs incurred by the contractor could exceed initial estimates, even though the fee is fixed. This necessitates robust oversight to ensure that all costs claimed are reasonable, allocable, and allowable. For the contractor, the risk lies in accurately estimating the costs required to complete the R&D within the fixed fee. If costs are underestimated, the contractor may not achieve their desired profit margin. Furthermore, the inherent uncertainty in R&D means that the path to achieving the desired outcomes is not always clear, potentially leading to scope creep or the need for contract modifications if research directions need to shift significantly.
What is the expected program effectiveness or outcome given the contract's focus on nanotechnology R&D?
The expected program effectiveness hinges on the successful advancement of nanotechnology applications relevant to defense. This could include developing novel materials with enhanced strength, reduced weight, or unique electromagnetic properties; creating more efficient energy storage or conversion devices; or improving sensor capabilities. The long duration (1635 days) suggests a phased approach, allowing for iterative development and testing. Success would be measured by the achievement of specific technical milestones outlined in the contract, the successful transition of developed technologies to prototypes or further development phases, and ultimately, their potential integration into future defense systems. The ultimate outcome is to provide the DoD with a technological edge through the application of cutting-edge nanotechnology.
How has federal spending on nanotechnology R&D evolved over the period encompassing this contract (2017-2022)?
Federal spending on nanotechnology R&D has been a consistent priority, with significant investments made across multiple agencies, including the Department of Defense (DoD), National Science Foundation (NSF), Department of Energy (DOE), and others. During the period of this contract (roughly 2017-2022), overall federal investment in nanotechnology remained robust, often fluctuating based on strategic priorities and budget allocations. The DoD, in particular, views nanotechnology as critical for maintaining technological superiority, focusing on areas like advanced materials, sensors, and microelectronics. While specific year-over-year figures for all federal nanotechnology R&D spending require detailed budget analysis, the continued awarding of large contracts like this one by the DoD indicates sustained commitment and funding for this sector during that timeframe.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in Nanotechnology
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: HQ014715S0001
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 499 BOEING BOULEVARD, HUNTSVILLE, AL, 35824
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: $89,914,047
Exercised Options: $89,914,047
Current Obligation: $89,894,852
Actual Outlays: $7,040,943
Subaward Activity
Number of Subawards: 113
Total Subaward Amount: $27,012,900
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2017-12-08
Current End Date: 2022-05-31
Potential End Date: 2022-05-31 00:00:00
Last Modified: 2024-07-02
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