Boeing's $268.7M ELV Services Contract: A Look at NASA's Launch Vehicle Procurement
Contract Overview
Contract Amount: $268,690,197 ($268.7M)
Contractor: THE Boeing Company
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2000-09-29
End Date: 2006-09-30
Contract Duration: 2,192 days
Daily Burn Rate: $122.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Other
Official Description: ORIGINAL AWARD AT GSFC -TRANSFERRED TO KSC 10/1/1998-MEDIUM LIGHT EXPENDABLE LAUNCH VEHICLE (ELV) SERVICES - DOLLARS ADJUSTED UP THRU MOD 68 WHEN TRANSFER OCCURRED
Place of Performance
Location: HUNTINGTON BEACH, ORANGE County, CALIFORNIA, 92647
Plain-Language Summary
National Aeronautics and Space Administration obligated $268.7 million to THE BOEING COMPANY for work described as: ORIGINAL AWARD AT GSFC -TRANSFERRED TO KSC 10/1/1998-MEDIUM LIGHT EXPENDABLE LAUNCH VEHICLE (ELV) SERVICES - DOLLARS ADJUSTED UP THRU MOD 68 WHEN TRANSFER OCCURRED Key points: 1. Contract awarded through full and open competition, suggesting a robust market for launch services. 2. Fixed-price with economic price adjustment structure aims to mitigate inflation risks for both parties. 3. The contract duration of 2192 days indicates a long-term commitment to reliable launch capabilities. 4. Awarded by NASA's Kennedy Space Center, highlighting its role in supporting space exploration missions. 5. The significant dollar value suggests a substantial investment in medium-light expendable launch vehicles. 6. Contractor, The Boeing Company, is a major aerospace player with extensive experience.
Value Assessment
Rating: good
The contract's total value of approximately $268.7 million over its period of performance suggests a significant investment in launch services. Benchmarking this against similar medium-light expendable launch vehicle (ELV) contracts would provide a clearer picture of value for money. The fixed-price with economic price adjustment (EPA) structure is common for long-term aerospace contracts, aiming to balance cost certainty with protection against market fluctuations. Without specific performance metrics or comparisons to alternative launch providers during the contract period, a precise value-for-money assessment is challenging, but the competitive award suggests a reasonable price was negotiated.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple bidders were likely considered. This approach typically fosters a competitive environment, encouraging providers to offer their best pricing and technical solutions. The presence of multiple bidders suggests a healthy market for medium-light ELV services at the time of award. The specific number of bidders and the evaluation criteria would offer further insight into the intensity of the competition and its impact on price discovery.
Taxpayer Impact: A full and open competition generally benefits taxpayers by driving down costs through market forces, ensuring that the government secures services at a competitive price point.
Public Impact
This contract directly supported NASA's space exploration and scientific missions by providing essential launch services for payloads. The primary beneficiaries are NASA and the scientific community, enabling the deployment of satellites and other space-based assets. The contract's impact is primarily national, supporting U.S. space program objectives. The workforce implications would be within the aerospace sector, particularly in engineering, manufacturing, and launch operations at Boeing and its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns due to the economic price adjustment clause if market conditions fluctuate significantly.
- Reliance on a single contractor for a critical service could pose risks if performance issues arise.
- The long duration might lead to technological obsolescence if launch vehicle technology advances rapidly.
Positive Signals
- Awarded through full and open competition, indicating a competitive pricing environment.
- The fixed-price structure provides a degree of cost certainty for the government.
- The contractor, Boeing, has a strong track record in aerospace and launch services.
- The contract supports critical national space program objectives.
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on launch services. The market for expendable launch vehicles (ELVs) is a critical component of the space industry, enabling the deployment of satellites for various purposes, including scientific research, communication, and national security. Spending in this sector is often characterized by high R&D costs, stringent safety requirements, and long development cycles. Comparable spending benchmarks would involve analyzing other ELV contracts awarded by NASA and the Department of Defense during the same period.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically related to small business set-asides for this particular award. However, large prime contractors like Boeing often engage small businesses as subcontractors for various components and services within major aerospace programs. The extent of small business participation would depend on Boeing's internal subcontracting strategy and any broader NASA initiatives to promote small business involvement in the aerospace supply chain.
Oversight & Accountability
Oversight for this contract would have been managed by NASA's contracting officers and program managers at the Kennedy Space Center. Accountability measures would be embedded in the contract terms, including performance requirements, delivery schedules, and quality standards. Transparency is generally facilitated through contract awards databases and public reporting of government spending. NASA's Office of Inspector General would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.
Related Government Programs
- NASA Expendable Launch Vehicle Services
- Space Launch Systems
- Satellite Deployment Contracts
- Aerospace Procurement
Risk Flags
- Long contract duration may increase risk of technological obsolescence.
- Economic price adjustment clause introduces potential for cost variability.
- Reliance on a single contractor for critical services.
Tags
nasa, expendable-launch-vehicle, launch-services, aerospace, fixed-price-with-economic-price-adjustment, full-and-open-competition, medium-light-elv, the-boeing-company, nasa-ksc, california
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $268.7 million to THE BOEING COMPANY. ORIGINAL AWARD AT GSFC -TRANSFERRED TO KSC 10/1/1998-MEDIUM LIGHT EXPENDABLE LAUNCH VEHICLE (ELV) SERVICES - DOLLARS ADJUSTED UP THRU MOD 68 WHEN TRANSFER OCCURRED
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $268.7 million.
What is the period of performance?
Start: 2000-09-29. End: 2006-09-30.
What was the historical spending trend for medium-light ELV services by NASA prior to this contract award?
Prior to this contract, NASA's spending on medium-light expendable launch vehicle (ELV) services would have been influenced by the evolving landscape of launch providers and mission requirements. Historically, NASA relied on a mix of government-developed vehicles and commercial services. The transition towards commercial launch services gained momentum in the late 20th century, driven by cost-efficiency and technological advancements. Analyzing NASA's budget allocations for launch services in the years preceding this award would reveal a trend towards outsourcing these capabilities to the private sector, particularly for medium-light payloads, as demonstrated by the competitive nature of this Boeing contract.
How did the economic price adjustment (EPA) clause impact the final cost of the contract compared to a fixed-price contract?
The economic price adjustment (EPA) clause in this contract allowed for modifications to the contract price based on changes in specified economic factors, such as labor rates, material costs, or inflation indices. This structure aimed to protect both the contractor and NASA from unforeseen cost escalations or de-escalations. If inflation was higher than anticipated during the contract's term, the EPA would have increased the final cost above what a strict fixed-price contract might have yielded. Conversely, if inflation was lower, the price might have been closer to a fixed-price outcome. Without the specific indices and adjustments applied, it's impossible to quantify the exact difference, but the EPA generally leads to a higher initial contract value or potential for price increases compared to a firm fixed-price agreement.
What were the primary performance metrics and success criteria for this ELV services contract?
While the specific performance metrics are not detailed in the provided data, typical success criteria for an expendable launch vehicle (ELV) services contract would include mission success rate (successful launch and payload deployment), adherence to launch schedules, payload integration support, and compliance with safety and quality standards. For a contract of this magnitude and duration, NASA would have likely established key performance parameters (KPPs) and metrics related to reliability, on-time delivery of launch services, and cost control. Failure to meet these metrics could result in penalties or affect future contract awards. The contractor's ability to consistently meet these benchmarks would be crucial for the contract's overall success.
What is the typical lifespan and technological relevance of medium-light ELVs procured under contracts like this?
The typical lifespan of a medium-light expendable launch vehicle (ELV) is tied to its specific mission profile and the technological generation it represents. ELVs are designed for single use, meaning their 'lifespan' is effectively the duration of a single launch mission. However, the technological relevance of the ELV platform itself can extend for many years, with upgrades and modifications allowing them to remain competitive. Contracts like this, spanning several years, often involve vehicles that may undergo incremental improvements. The challenge lies in ensuring that the procured ELV technology remains viable and cost-effective against newer, potentially more advanced or cheaper alternatives that emerge during the contract's performance period.
How does the 'medium-light' classification of ELV services differentiate it from heavy-lift launch vehicles in terms of cost and capability?
The classification of 'medium-light' expendable launch vehicles (ELVs) distinguishes them from heavy-lift counterparts primarily by their payload capacity and, consequently, their cost. Medium-light ELVs are designed to launch payloads typically ranging from a few hundred kilograms to several thousand kilograms into various Earth orbits. This makes them suitable for smaller scientific satellites, commercial communication satellites, and technology demonstration missions. Heavy-lift vehicles, on the other hand, are engineered to transport much larger and heavier payloads, often tens of thousands of kilograms, into higher energy orbits or for deep space missions. Due to their smaller size and lower thrust requirements, medium-light ELVs generally have a lower per-launch cost compared to heavy-lift systems, making them a more economical choice for smaller space assets.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 2
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Contractor Details
Address: 5301 BOLSA, HUNTINGTON BEACH, CA, 47
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $190,868,153
Exercised Options: $190,868,153
Current Obligation: $268,690,197
Timeline
Start Date: 2000-09-29
Current End Date: 2006-09-30
Potential End Date: 2006-09-30 00:00:00
Last Modified: 2012-02-22
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