DoD Awards Boeing $27.8M for Aircraft Refurbishment, Lacking Competition
Contract Overview
Contract Amount: $27,850,713 ($27.9M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2021-01-22
End Date: 2026-04-30
Contract Duration: 1,924 days
Daily Burn Rate: $14.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: FY21 CAPSULE REFURBS
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $27.9 million to THE BOEING COMPANY for work described as: FY21 CAPSULE REFURBS Key points: 1. Significant contract value awarded to a single, large defense contractor. 2. Lack of competition raises concerns about price discovery and potential overspending. 3. Long contract duration (over 5 years) increases exposure to market fluctuations. 4. Aircraft manufacturing sector is critical but often dominated by a few key players.
Value Assessment
Rating: questionable
The $27.8M award for aircraft refurbishment lacks a clear benchmark due to its sole-source nature. Without competitive bids, it's difficult to assess if the pricing is optimal compared to potential market alternatives or similar past contracts.
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 limits price discovery mechanisms and potentially leads to higher costs for taxpayers as there is no competitive pressure to offer the best price.
Taxpayer Impact: The absence of competition may result in taxpayers paying a premium for these refurbishment services, as the government did not explore potentially more cost-effective options.
Public Impact
Taxpayers may be overpaying for aircraft refurbishment due to the lack of competitive bidding. The long-term nature of the contract could lock the government into a specific vendor, limiting future flexibility. Dependence on a single contractor for critical aircraft maintenance could pose a risk to operational readiness if issues arise.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- High dollar value
Positive Signals
- Award to established prime contractor
- Firm fixed price contract
Sector Analysis
This contract falls within the Defense sector, specifically aircraft manufacturing and maintenance. Spending in this area is substantial, driven by national security needs, but often characterized by high barriers to entry and limited competition among major aerospace firms.
Small Business Impact
The contract was awarded to The Boeing Company, a large prime contractor, and there is no indication of subcontracting opportunities for small businesses in the provided data. This suggests minimal direct benefit to the small business sector from this specific award.
Oversight & Accountability
The contract was awarded via a delivery order under an existing contract, suggesting some level of prior review. However, the lack of competition for this specific order warrants scrutiny to ensure fair pricing and value for taxpayer funds.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competition
- Long contract duration
- Potential for cost overruns
- Limited small business participation
- Sole-source award
Tags
aircraft-manufacturing, department-of-defense, mo, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $27.9 million to THE BOEING COMPANY. FY21 CAPSULE REFURBS
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $27.9 million.
What is the period of performance?
Start: 2021-01-22. End: 2026-04-30.
What justification was provided for not competing this significant refurbishment contract, and does it align with federal procurement regulations for sole-source awards?
The provided data does not include the justification for the sole-source award. Federal regulations typically require a compelling reason, such as unique capabilities or urgent need, to bypass full and open competition. Further investigation into the contract file is needed to ascertain the specific justification and its validity.
How does the firm fixed price of this contract compare to industry benchmarks for similar aircraft refurbishment services, considering the lack of competitive bids?
Without competitive bids, establishing a precise benchmark is challenging. However, the firm fixed price aims to transfer risk to the contractor. A post-award analysis comparing the negotiated price against historical data for similar services, adjusted for inflation and scope, would be necessary to assess value.
What are the potential risks associated with a sole-source, long-term contract for critical aircraft refurbishment, particularly concerning cost escalation and vendor performance?
Sole-source, long-term contracts carry risks of cost escalation if not properly managed, as the government lacks competitive leverage. Vendor performance can also be a concern, as there's less incentive for the contractor to exceed expectations. Robust oversight and clear performance metrics are crucial to mitigate these risks.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: GUIDED MISSLES
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
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: $27,954,120
Exercised Options: $27,850,713
Current Obligation: $27,850,713
Subaward Activity
Number of Subawards: 5
Total Subaward Amount: $10,630,286
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0001916G0001
IDV Type: BOA
Timeline
Start Date: 2021-01-22
Current End Date: 2026-04-30
Potential End Date: 2026-04-30 00:00:00
Last Modified: 2025-11-13
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