DoD awards $26.6M for P-8A aircraft parts, raising questions about competition and value

Contract Overview

Contract Amount: $26,581,016 ($26.6M)

Contractor: Hamble Aerostructures Limited

Awarding Agency: Department of Defense

Start Date: 2020-07-29

End Date: 2024-10-31

Contract Duration: 1,555 days

Daily Burn Rate: $17.1K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: P-8A LOTS 9-10 DELIVERY ORDER FOR ORDERING PERIODS 1&2

Plain-Language Summary

Department of Defense obligated $26.6 million to HAMBLE AEROSTRUCTURES LIMITED for work described as: P-8A LOTS 9-10 DELIVERY ORDER FOR ORDERING PERIODS 1&2 Key points: 1. The contract's value, while significant, lacks clear justification for its pricing without competitive benchmarking. 2. Limited competition raises concerns about potential overpayment and reduced innovation. 3. The firm-fixed-price structure shifts some risk to the contractor, but oversight is crucial. 4. This award is part of ongoing sustainment efforts for the P-8A Poseidon fleet. 5. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: questionable

The total award of $26.6 million for P-8A aircraft parts across two ordering periods lacks sufficient detail for a robust value assessment. Without comparable contract data or a breakdown of unit costs, it is difficult to benchmark this against market rates or similar procurements. The firm-fixed-price contract type suggests a defined cost structure, but the absence of competitive bidding makes it challenging to ascertain if the pricing reflects fair market value or if taxpayers are receiving optimal value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach limits the opportunity for multiple vendors to bid, which typically drives down prices and fosters innovation. The justification for a sole-source award needs to be thoroughly reviewed to ensure it is indeed the only viable option and that the government has explored all avenues for competition. The lack of competition here means the government did not benefit from price discovery through a bidding process.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to ensure the lowest possible price. This also reduces transparency in pricing and can signal a lack of market availability or a reliance on a single supplier.

Public Impact

The primary beneficiaries are the Department of the Navy and its P-8A Poseidon maritime patrol aircraft fleet, ensuring operational readiness. Services delivered include the supply of critical aircraft parts for sustainment and maintenance. The geographic impact is primarily within the United States, supporting naval aviation bases and operations. Workforce implications may include specialized manufacturing and logistics roles within the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices.
Sole-source award limits transparency in pricing.
No clear indication of small business participation or subcontracting goals.
Limited data available to assess the true value for money.

Positive Signals

Firm-fixed-price contract shifts some cost risk to the contractor.
Supports the sustainment of a critical military asset (P-8A Poseidon).
Awarded to a known entity in the aerospace sector.

Sector Analysis

This contract falls within the aerospace manufacturing sector, specifically focusing on aircraft parts. The market for specialized military aircraft components is often characterized by high barriers to entry, proprietary technology, and a limited number of qualified suppliers. The P-8A Poseidon is a key platform for maritime patrol and reconnaissance, and its sustainment requires specialized parts. Benchmarking this spending would ideally involve comparing it to other sustainment contracts for similar high-value military aircraft, considering the unique nature of the components supplied.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This raises concerns about the potential exclusion of small businesses from participating in the supply chain for these critical aircraft parts. Without specific subcontracting plans or goals mandated in the contract, it is unclear what opportunities, if any, exist for small businesses to contribute to this procurement. This could limit the broader impact on the small business defense industrial base.

Oversight & Accountability

The contract is a delivery order under a larger contract vehicle, implying that some level of oversight was conducted during the initial award of the base contract. However, the specific oversight mechanisms for this particular delivery order, especially given its sole-source nature, are not detailed. Accountability would typically stem from the contracting officer's review of the justification for sole-source procurement and the negotiation of terms. Transparency is limited due to the lack of competitive bidding and public detail on pricing.

Related Government Programs

P-8A Poseidon Aircraft Program
Naval Aviation Sustainment Contracts
Defense Aircraft Parts Manufacturing
Sole-Source Defense Procurements

Risk Flags

Sole-source award lacks competitive justification.
Potential for uncompetitive pricing.
Limited transparency on value for money.
No clear small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.6 million to HAMBLE AEROSTRUCTURES LIMITED. P-8A LOTS 9-10 DELIVERY ORDER FOR ORDERING PERIODS 1&2

Who is the contractor on this award?

The obligated recipient is HAMBLE AEROSTRUCTURES LIMITED.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $26.6 million.

What is the period of performance?

Start: 2020-07-29. End: 2024-10-31.

What is the track record of Hamble Aerostructures Limited in supplying parts for the P-8A program or similar military aircraft?

Information regarding Hamble Aerostructures Limited's specific track record with the P-8A program or similar military aircraft is not readily available in the provided data. To assess their reliability and performance, a deeper dive into past performance reviews, delivery history, quality control metrics, and any prior contract awards with the Department of Defense or other defense agencies would be necessary. Understanding their experience with complex aerospace components and their ability to meet stringent military specifications is crucial for evaluating this sole-source award.

How does the pricing of these P-8A parts compare to industry benchmarks or previous procurements for similar components?

The provided data does not include specific pricing details or unit costs for the P-8A parts, making a direct comparison to industry benchmarks or previous procurements impossible. Given the sole-source nature of this award, there is an inherent risk that the pricing may not be as competitive as it would be in a fully competed environment. A thorough analysis would require access to detailed cost breakdowns, historical pricing data for comparable parts, and potentially an independent government cost estimate to validate the reasonableness of the awarded price.

What are the primary risks associated with awarding this contract on a sole-source basis, and how are they being mitigated?

The primary risks of a sole-source award include potential overpricing due to lack of competition, reduced incentive for innovation, and a lack of transparency in the procurement process. Mitigation strategies typically involve rigorous justification for the sole-source determination, thorough negotiation of contract terms and pricing, and robust contract administration to ensure compliance and quality. The government should ensure that the justification for sole-sourcing is valid and that Hamble Aerostructures Limited is held to high performance standards throughout the contract duration.

What is the expected impact of this contract on the overall sustainment and operational readiness of the P-8A Poseidon fleet?

This contract is intended to ensure the continued sustainment and operational readiness of the P-8A Poseidon fleet by providing necessary aircraft parts. The timely delivery of these components is critical for maintaining the airworthiness and availability of the aircraft for their intended missions, which include maritime patrol, anti-submarine warfare, and intelligence, surveillance, and reconnaissance. The success of this contract directly contributes to the Navy's ability to deploy and operate this vital platform effectively.

What has been the historical spending pattern for P-8A aircraft parts, and how does this award fit within that trend?

The provided data only details this specific award of $26.6 million for P-8A LOTS 9-10. To understand historical spending patterns, one would need to examine cumulative spending on P-8A parts over previous years, including data from other contracts, delivery orders, and potentially different contract types. This award represents a portion of the ongoing sustainment costs for the P-8A fleet. Without broader historical data, it's difficult to determine if this award is higher or lower than previous trends, but it signifies continued investment in the aircraft's lifecycle.

Are there any specific performance metrics or deliverables tied to this contract that will be publicly reported?

The provided data does not specify any public performance metrics or deliverables tied to this particular delivery order. Typically, performance metrics are outlined within the contract's statement of work and are monitored by the contracting officer's representative (COR). While the government tracks performance internally, public reporting on specific metrics for individual delivery orders is not always standard practice, especially for component supply contracts. Transparency regarding performance would depend on the government's reporting policies for this contract vehicle.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Aernnova Aerospace Corporation, S.A.

Address: KINGS AVENUE, SOUTHAMPTON

Business Categories: Category Business, Foreign Owned, International Organization, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $26,581,016

Exercised Options: $26,581,016

Current Obligation: $26,581,016

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0001920D0012

IDV Type: IDC

Timeline