Boeing Awarded $2.44 Billion for F/A-18E/EA-18G Aircraft and AEA Kits by Department of the Navy
Contract Overview
Contract Amount: $2,444,992,704 ($2.4B)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2017-02-27
End Date: 2026-07-31
Contract Duration: 3,441 days
Daily Burn Rate: $710.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: LOT 40 F/A-18E AND EA-18G AIRCRAFT WITH AEA KITS
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $2.44 billion to THE BOEING COMPANY for work described as: LOT 40 F/A-18E AND EA-18G AIRCRAFT WITH AEA KITS Key points: 1. The contract is a sole-source award to The Boeing Company, raising questions about competition. 2. The fixed-price incentive contract type aims to balance cost control with performance incentives. 3. The duration of the contract extends to July 2026, indicating a long-term commitment. 4. The total value of $2.44 billion represents a significant investment in naval aviation capabilities.
Value Assessment
Rating: questionable
The contract value of $2.44 billion for F/A-18E and EA-18G aircraft with AEA kits is substantial. Benchmarking against similar sole-source aircraft procurements is difficult due to the lack of competitive pricing data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This lack of competition limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The absence of competition in this significant procurement may result in taxpayers paying a premium for these aircraft and kits.
Public Impact
Ensures continued operation and modernization of critical naval fighter and electronic warfare aircraft. Supports advanced capabilities for the U.S. Navy's air wing. Potential for extended reliance on legacy aircraft platforms. Impacts the readiness and deployment capabilities of naval forces.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition
- Lack of transparency in pricing
- Long contract duration
Positive Signals
- Procurement of critical defense assets
- Supports advanced naval aviation capabilities
Sector Analysis
This contract falls within the Defense sector, specifically aircraft manufacturing. Spending benchmarks for sole-source aircraft procurements are highly variable and depend on specific platform capabilities and market conditions.
Small Business Impact
The contract data indicates that small business participation is not explicitly mentioned or required, which is common for large sole-source prime contracts awarded to major defense manufacturers like Boeing.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Navy's contracting and program management offices. Accountability for performance and cost is inherent in the fixed-price incentive structure.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award
- Lack of competitive pricing data
- Long contract duration
- Potential for cost growth
- Limited small business participation
Tags
aircraft-manufacturing, department-of-defense, mo, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $2.44 billion to THE BOEING COMPANY. LOT 40 F/A-18E AND EA-18G AIRCRAFT WITH AEA KITS
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $2.44 billion.
What is the period of performance?
Start: 2017-02-27. End: 2026-07-31.
What is the justification for the sole-source award, and what steps were taken to ensure fair and reasonable pricing without competition?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or the inability of other sources to meet the requirement. The Department of the Navy would have conducted a 'Justification and Approval' (J&A) process to document why competition was not feasible. Fair and reasonable pricing is assessed through various means, including historical pricing, should-cost analyses, and comparison to similar systems, even if not directly competitive.
What are the potential risks associated with a long-term, sole-source contract for advanced aircraft procurement?
Long-term, sole-source contracts carry risks such as potential cost overruns if not managed tightly, reduced incentive for the contractor to innovate or improve efficiency, and a lack of market pressure to lower prices. There's also a risk of technological obsolescence if the platform doesn't keep pace with evolving threats or if alternative, more advanced solutions emerge that are not considered due to the existing contract.
How does this procurement contribute to the overall effectiveness and readiness of the U.S. Navy's air combat capabilities?
This procurement directly ensures the continued availability and modernization of the F/A-18E Super Hornet and EA-18G Growler aircraft, which are crucial for fleet air defense, strike missions, and electronic warfare. By providing these platforms with necessary upgrades (AEA kits), the contract sustains and enhances the Navy's operational effectiveness and readiness to meet global security challenges.
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
Solicitation ID: N0001916R0017
Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JS MCDONNELL BLVD, SAINT LOUIS, MO, 63134
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: $2,448,777,201
Exercised Options: $2,448,597,680
Current Obligation: $2,444,992,704
Actual Outlays: $23,759,419
Subaward Activity
Number of Subawards: 326
Total Subaward Amount: $1,294,232,654
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2017-02-27
Current End Date: 2026-07-31
Potential End Date: 2026-07-31 00:00:00
Last Modified: 2025-06-30
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