Naval Air Systems Command Awards $740M Contract to Bell Helicopter for H-1 Upgrade Program

Contract Overview

Contract Amount: $740,349,876 ($740.3M)

Contractor: Bell Textron Inc

Awarding Agency: Department of Defense

Start Date: 2006-07-20

End Date: 2014-10-31

Contract Duration: 3,025 days

Daily Burn Rate: $244.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200610!467468!1700!N00019!NAVAL AIR SYSTEMS COMMAND !N0001906C0086 !A!N! !N! ! !20060720!20080930!062923321!062923321!001338979!N!BELL HELICOPTER TEXTRON INC !600 E HURST BLVD !HURST !TX!76053!27000!439!48!FORT WORTH !TARRANT !TEXAS !+000137422138!N!N!000312126498!1520!AIRCRAFT ROTARY WING !A1A!AIRFRAMES AND SPARES !101 !USMC H-1 UPGRADE !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !D!U!J!1!001!N!1A!A!Y!A! ! !N!C!N! ! ! !A!A!A!A!000!A!B!N! ! ! !Y!1700!N00019!0001! !

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76118

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $740.3 million to BELL TEXTRON INC for work described as: 200610!467468!1700!N00019!NAVAL AIR SYSTEMS COMMAND !N0001906C0086 !A!N! !N! ! !20060720!20080930!062923321!062923321!001338979!N!BELL HELICOPTER TEXTRON INC !600 E HURST BLVD !HURST !TX!76053!27000!439!48!FORT WORTH !TARR… Key points: 1. Significant contract value of $740.4 million for aircraft rotary wing components. 2. Bell Helicopter Textron Inc. is the sole awardee, raising questions about competition. 3. The contract carries a risk of higher costs due to limited competition. 4. Spending is concentrated in the Defense sector, specifically aircraft manufacturing.

Value Assessment

Rating: questionable

The contract value of $740.4 million for aircraft rotary wing components appears substantial. Benchmarking against similar contracts for H-1 upgrades or related helicopter components would be necessary to fully assess its pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating a lack of competitive bidding. This method can limit price discovery and potentially lead to less favorable pricing for the government.

Taxpayer Impact: The sole-source nature of this award may result in higher taxpayer costs compared to a competitively bid contract.

Public Impact

Taxpayers may be paying a premium due to the lack of competition. The H-1 Upgrade program is critical for USMC aviation readiness. Dependence on a single supplier could pose supply chain risks. Long-term sustainment costs for the H-1 fleet are a potential concern.

Waste & Efficiency Indicators

Waste Risk Score: 75 / 10

Warning Flags

Sole-source award limits competition and price discovery.
Potential for cost overruns due to lack of competitive pressure.
Long contract duration (over 10 years) increases risk exposure.

Positive Signals

Addresses critical USMC aviation upgrade needs.
Firm Fixed Price contract provides some cost certainty.

Sector Analysis

This contract falls within the Defense sector, specifically aircraft manufacturing. The $740.4 million award is a significant investment in military aviation upgrades, with benchmarks typically assessed against similar sole-source or limited-competition defense contracts.

Small Business Impact

There is no indication in the provided data that small businesses were involved in this contract, either as prime contractors or subcontractors. Further investigation would be needed to determine any small business participation.

Oversight & Accountability

The contract was awarded by the Naval Air Systems Command, a component of the Department of Defense. Oversight would typically involve contract administration by the Defense Contract Management Agency to ensure compliance and performance.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source award limits competition.
Potential for higher costs without competitive bidding.
Long contract duration increases risk.
Lack of transparency on pricing justification.
Dependence on a single supplier.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $740.3 million to BELL TEXTRON INC. 200610!467468!1700!N00019!NAVAL AIR SYSTEMS COMMAND !N0001906C0086 !A!N! !N! ! !20060720!20080930!062923321!062923321!001338979!N!BELL HELICOPTER TEXTRON INC !600 E HURST BLVD !HURST !TX!76053!27000!439!48!FORT WORTH !TARRANT !TEXAS !+000137422138!N!N!000312126498!1520!AIRCRAFT ROTARY WING !A1A!AIRFRAMES AND SPARES !101 !USMC H-1 UPGRADE !336411!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is BELL TEXTRON INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $740.3 million.

What is the period of performance?

Start: 2006-07-20. End: 2014-10-31.

What was the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair and reasonable pricing?

The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or a lack of viable alternatives. To ensure fair and reasonable pricing, the government would likely conduct a price analysis based on historical data, cost breakdowns, and market research. However, without competition, the inherent price discovery mechanism is absent, making robust government analysis crucial.

What are the long-term cost implications of this sole-source contract for the H-1 upgrade program and future sustainment?

Sole-source contracts can lead to higher long-term costs due to the absence of competitive pressure to reduce prices over the contract's life. For sustainment, this could mean ongoing higher prices for parts, labor, and support services. The government may need to proactively negotiate future options or re-evaluate competition for sustainment services to mitigate these long-term cost risks.

How does the performance of Bell Helicopter Textron Inc. on this contract align with the program's objectives for USMC aviation readiness?

Assessing performance alignment requires tracking key performance indicators (KPIs) such as delivery schedules, quality of components, and adherence to technical specifications. Positive performance would mean timely delivery of high-quality upgrades that enhance the H-1 fleet's capabilities and readiness. Negative performance could indicate delays or quality issues impacting the USMC's operational effectiveness.

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

Parent Company: Textron Inc

Address: 3255 BELL FLIGHT BLVD, FORT WORTH, TX, 76118

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline