Boeing awarded $107M contract for B-KITS, with performance extending through December 2025
Contract Overview
Contract Amount: $106,896,967 ($106.9M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2021-06-03
End Date: 2025-12-19
Contract Duration: 1,660 days
Daily Burn Rate: $64.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: FY21 B-KITS - USN
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $106.9 million to THE BOEING COMPANY for work described as: FY21 B-KITS - USN Key points: 1. Contract value represents a significant investment in aircraft parts and auxiliary equipment. 2. Sole-source award raises questions about potential price efficiencies and market competition. 3. Long contract duration suggests a sustained need for these specific aircraft components. 4. Fixed-price contract structure shifts performance risk to the contractor. 5. Geographic concentration in Missouri for contract performance. 6. The contract falls under the broader category of Other Aircraft Parts and Auxiliary Equipment Manufacturing.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without specific details on the B-KITS components and their market prices. The $107 million award over approximately 4.5 years suggests a substantial per-year expenditure. However, the lack of competitive bidding means there's no direct market validation of the pricing. Compared to similar sole-source awards for specialized aircraft parts, the price may be within an expected range, but without more data, a definitive value-for-money assessment is difficult. The fixed-price nature provides some cost certainty for the government.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, The Boeing Company, was solicited. This approach is typically used when a unique capability or proprietary technology is required, or in situations where only one source can fulfill the requirement. The lack of competition means the government did not benefit from a bidding process that could drive down prices through market forces. The absence of multiple bidders limits the government's ability to explore alternative solutions or pricing structures.
Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as the government does not have the benefit of competitive pricing. This necessitates robust internal cost analysis and negotiation by the contracting agency to ensure fair and reasonable pricing.
Public Impact
The primary beneficiaries are the Department of the Navy and potentially its aviation fleet, ensuring the availability of critical aircraft parts. Services delivered include the manufacturing and supply of 'B-KITS' (specific aircraft parts). Geographic impact is concentrated in Missouri, where the contractor is located. Workforce implications include employment at Boeing facilities in Missouri involved in the production of these parts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may result in higher costs for taxpayers.
- Sole-source nature limits opportunities for small business participation as prime contractors.
- Long-term contract duration could lead to vendor lock-in if not managed carefully.
Positive Signals
- Fixed-price contract shifts cost overrun risk to the contractor.
- Long-term award provides supply chain stability for critical aircraft components.
- Boeing's established expertise in aerospace manufacturing suggests a high likelihood of successful delivery.
Sector Analysis
The aerospace and defense sector is characterized by high barriers to entry, complex supply chains, and significant government procurement. Contracts for aircraft parts and auxiliary equipment are crucial for maintaining military readiness and operational capabilities. The market for specialized components like B-KITS is often dominated by a few large, established manufacturers due to the technical expertise and certifications required. Spending in this sub-sector is driven by fleet modernization, maintenance, and upgrade programs.
Small Business Impact
As a sole-source award to a large prime contractor, this contract does not appear to include specific small business set-aside provisions. While Boeing may engage small businesses as subcontractors, the primary contract structure does not directly promote small business participation. This limits opportunities for small businesses to compete for the prime contract itself, potentially impacting the broader small business ecosystem within the aerospace supply chain.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Defense Contract Management Agency (DCMA) likely plays a role in monitoring performance and compliance. Given it's a fixed-price contract, oversight would focus on delivery schedules, quality standards, and adherence to contract terms. Transparency is generally maintained through contract databases, though specific performance details may be sensitive.
Related Government Programs
- Aircraft Parts and Auxiliary Equipment Manufacturing
- Defense Logistics Agency (DLA) Procurement
- Naval Air Systems Command (NAVAIR) Contracts
- Aerospace Manufacturing Contracts
Risk Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
- Long contract duration
Tags
defense, department-of-the-navy, missouri, definitive-contract, large-contract, sole-source, firm-fixed-price, aircraft-parts, aerospace, manufacturing, usn
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $106.9 million to THE BOEING COMPANY. FY21 B-KITS - USN
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 $106.9 million.
What is the period of performance?
Start: 2021-06-03. End: 2025-12-19.
What is the specific nature and function of the 'B-KITS' being procured under this contract?
The provided data does not specify the exact nature or function of the 'B-KITS'. However, given the contractor (The Boeing Company) and the awarding agency (Department of the Navy), it is highly probable that B-KITS refer to a specific set of components, sub-assemblies, or kits essential for the operation, maintenance, or upgrade of certain naval aircraft platforms. These could range from engine components, avionics modules, structural parts, or specialized mission equipment kits. The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' classification further supports this, indicating a broad category of essential aircraft hardware.
How does the $107 million contract value compare to historical spending on similar aircraft parts by the Department of the Navy?
Without specific historical data on 'B-KITS' or comparable sole-source procurements for similar aircraft parts by the Department of the Navy, a direct comparison is difficult. However, $107 million over approximately 4.5 years represents an average annual expenditure of roughly $23.8 million. This figure needs to be contextualized against the total budget for naval aviation maintenance and procurement. Sole-source contracts for specialized components can often be more expensive than competitively bid ones. To assess value, one would need to compare this to previous contracts for the same or similar kits, or to the cost of alternative solutions if they existed.
What are the primary risks associated with a sole-source award of this magnitude and duration?
The primary risks associated with a sole-source award of this magnitude and duration include potential overpricing due to the lack of competition, limited opportunities for innovation from alternative suppliers, and the risk of vendor lock-in. Taxpayers may bear a higher cost if the negotiated price is not sufficiently scrutinized. Furthermore, a long-term sole-source contract can reduce the incentive for the contractor to seek cost efficiencies over time. Dependence on a single supplier also increases vulnerability to supply chain disruptions originating from that specific contractor.
What performance metrics or oversight mechanisms are likely in place to ensure the successful delivery of these aircraft parts?
For a contract of this nature, performance metrics would likely include adherence to delivery schedules, quality control standards (e.g., meeting technical specifications, defect rates), and potentially production ramp-up timelines. Oversight mechanisms would involve the Department of the Navy's contracting officers and program managers, potentially supported by the Defense Contract Management Agency (DCMA) for quality assurance and progress monitoring. Regular progress reports from Boeing, site visits, and acceptance testing of delivered components are standard oversight practices to ensure contract compliance and successful delivery.
What is The Boeing Company's track record with the Department of the Navy for similar aircraft parts contracts?
The Boeing Company has a long-standing and extensive track record as a major defense contractor, including significant work with the Department of the Navy across various aircraft platforms and systems. They are a primary manufacturer for several naval aircraft and a key supplier of components and support services. While specific data on 'B-KITS' is not provided, Boeing's history suggests a high level of capability and experience in delivering complex aerospace products. Past performance reviews and contract awards databases would provide more granular detail on their specific performance history with the Navy for similar parts.
How does this contract fit into the broader context of the Navy's current aviation fleet sustainment and modernization strategy?
This contract likely plays a role in the sustainment of the Navy's existing aviation fleet by ensuring the availability of critical 'B-KITS'. Depending on the specific nature of the kits, they could also support modernization efforts if they are part of upgrade packages for older aircraft or are components for newer platforms. The long duration suggests a strategic decision to secure a stable supply chain for these parts over a significant period, aligning with the Navy's long-term readiness and operational planning objectives for its aircraft inventory.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0001919R0024
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JAMES S 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: $106,896,967
Exercised Options: $106,896,967
Current Obligation: $106,896,967
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2021-06-03
Current End Date: 2025-12-19
Potential End Date: 2025-12-19 00:00:00
Last Modified: 2025-09-12
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