DoD Awards $712M for LRIP III Pratt Engines to RTX Corporation
Contract Overview
Contract Amount: $712,197,034 ($712.2M)
Contractor: RTX Corporation
Awarding Agency: Department of Defense
Start Date: 2008-09-02
End Date: 2013-04-30
Contract Duration: 1,701 days
Daily Burn Rate: $418.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE
Sector: Defense
Official Description: AAC AWARD FOR LRIP III PRATT
Place of Performance
Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06108
Plain-Language Summary
Department of Defense obligated $712.2 million to RTX CORPORATION for work described as: AAC AWARD FOR LRIP III PRATT Key points: 1. Significant contract value of $712M for aircraft engine parts. 2. RTX Corporation is the sole awardee, raising questions about competition. 3. Potential risk associated with a single supplier for critical defense components. 4. Spending falls within the Aircraft Engine and Engine Parts Manufacturing sector.
Value Assessment
Rating: fair
The contract type is Cost Plus Incentive, which can lead to cost overruns if not managed carefully. The total award amount is substantial, and without further data on performance and final costs, a precise value assessment is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although listed as 'FULL AND OPEN COMPETITION', the data shows only one awardee (RTX Corporation). This suggests either a highly specialized requirement or potential limitations in the competitive process, impacting price discovery.
Taxpayer Impact: The substantial award amount necessitates robust oversight to ensure taxpayer funds are used efficiently and effectively, especially given the single awardee.
Public Impact
Ensures continued supply of critical aircraft engines for naval operations. Supports a major defense contractor and its supply chain. Potential for long-term reliance on a single manufacturer for this engine type.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Single awardee despite 'full and open' competition.
- Cost-plus contract type can inflate costs.
- Long contract duration (1701 days).
Positive Signals
- Addresses a critical defense need.
- RTX Corporation is a major aerospace and defense company.
Sector Analysis
This contract falls under the Aircraft Engine and Engine Parts Manufacturing sector, a critical component of the aerospace and defense industry. Spending in this sector is often characterized by high R&D costs and long production cycles.
Small Business Impact
The awardee, RTX Corporation, is a large prime contractor. There is no indication of small business participation in this specific award data, suggesting potential missed opportunities for subcontracting.
Oversight & Accountability
The contract was awarded by the Department of the Navy. Oversight would focus on ensuring cost controls, performance metrics, and adherence to the incentive structure are met throughout the contract's lifecycle.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of demonstrated competition despite 'full and open' status.
- Potential for cost overruns due to contract type.
- Long contract duration.
- Single awardee for critical defense component.
- No apparent small business subcontracting noted.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ct, dca, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $712.2 million to RTX CORPORATION. AAC AWARD FOR LRIP III PRATT
Who is the contractor on this award?
The obligated recipient is RTX CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $712.2 million.
What is the period of performance?
Start: 2008-09-02. End: 2013-04-30.
What was the justification for awarding to a single entity if the competition was advertised as full and open?
The 'full and open competition' designation may refer to the initial solicitation process. However, the award to a single entity suggests that only one offeror met the technical requirements, or there were other factors limiting the award to one source. Further investigation into the source selection documentation would clarify the specific reasons.
What are the risks associated with a cost-plus incentive contract for LRIP III engines?
Cost-plus incentive contracts carry inherent risks of cost overruns if the contractor does not effectively manage expenses or if targets are not met. For LRIP (Low Rate Initial Production), the focus is often on establishing production capabilities, which can be less efficient initially. Close monitoring of cost targets and performance incentives is crucial to mitigate these risks.
How does this award impact the long-term availability and cost of these specific aircraft engines?
This award ensures the continued production of these engines for the specified period. However, awarding to a single entity for a critical component like an engine could lead to long-term sole-source reliance, potentially limiting future competitive pricing and innovation. The government may face higher costs in subsequent procurements if alternative sources are not developed.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: RAILWAY EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 400 MAIN ST, EAST HARTFORD, CT, 01
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $712,197,034
Exercised Options: $712,197,034
Current Obligation: $712,197,034
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2008-09-02
Current End Date: 2013-04-30
Potential End Date: 2013-04-30 00:00:00
Last Modified: 2013-07-16
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