DoD awards Boeing $9.06M for Aircraft Engine Parts, raising concerns about limited competition
Contract Overview
Contract Amount: $9,059,830 ($9.1M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2022-09-30
End Date: 2028-08-31
Contract Duration: 2,162 days
Daily Burn Rate: $4.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: LABOR
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $9.1 million to THE BOEING COMPANY for work described as: LABOR Key points: 1. Significant contract value for specialized aircraft engine parts. 2. Sole-source award to Boeing limits competitive pricing. 3. Potential risk associated with reliance on a single supplier. 4. Spending concentrated in the Aircraft Engine and Engine Parts Manufacturing sector.
Value Assessment
Rating: questionable
The contract's Cost Plus Fixed Fee structure, combined with a sole-source award, makes a direct pricing assessment difficult without comparable bids. The lack of competition suggests potential overpayment.
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 significantly limits price discovery and may lead to higher costs for taxpayers.
Taxpayer Impact: The absence of competition in this sole-source award likely results in a higher cost to taxpayers than if the contract had been competitively bid.
Public Impact
Taxpayers may be paying a premium due to the lack of competitive bidding. Dependence on a single supplier for critical aircraft engine parts poses a supply chain risk. The Department of Defense's procurement strategy warrants scrutiny for potential cost efficiencies.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost Plus Fixed Fee contract type
- Lack of small business participation
- Long contract duration
Positive Signals
- Award to established prime contractor
- Supports critical defense needs
Sector Analysis
This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector, which is crucial for defense readiness. Benchmarks for similar sole-source contracts are difficult to ascertain, but competition typically drives down costs.
Small Business Impact
The data indicates no small business participation in this contract. This is a missed opportunity to foster small business growth and potentially leverage specialized capabilities at competitive prices.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight to ensure costs are reasonable and performance meets expectations. Transparency in the justification for not competing is essential.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award
- Cost Plus Fixed Fee contract
- Lack of small business participation
- Long contract duration (2028 end date)
- Potential for cost overruns
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, mo, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $9.1 million to THE BOEING COMPANY. LABOR
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 $9.1 million.
What is the period of performance?
Start: 2022-09-30. End: 2028-08-31.
What is the justification for awarding this contract on a sole-source basis, and what steps are being taken to ensure cost reasonableness?
The justification for a sole-source award typically involves unique capabilities or urgent needs. Robust oversight is crucial to scrutinize cost elements, including labor rates and overhead, and to ensure the fixed fee is appropriate given the risks and effort involved. Regular audits and performance reviews are essential to manage taxpayer funds effectively.
What are the potential risks associated with relying solely on The Boeing Company for these critical aircraft engine parts?
Sole reliance on one supplier creates significant supply chain vulnerability. Risks include potential production delays, price increases due to lack of competition, and reduced leverage for the government in negotiations. If Boeing faces production issues or decides to discontinue the part, the DoD could face substantial disruption and costly alternatives.
How does the Cost Plus Fixed Fee (CPFF) contract structure impact the government's ability to control costs in this sole-source scenario?
CPFF contracts allow the contractor to recover all allowable costs plus a predetermined fixed fee. While the fee is fixed, the total cost can fluctuate significantly based on actual costs incurred. In a sole-source situation, this structure offers less cost control for the government compared to fixed-price contracts, as the incentive for the contractor to minimize costs is primarily driven by the fixed fee rather than overall project savings.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
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: $9,059,830
Exercised Options: $9,059,830
Current Obligation: $9,059,830
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0001921G0006
IDV Type: BOA
Timeline
Start Date: 2022-09-30
Current End Date: 2028-08-31
Potential End Date: 2028-08-31 00:00:00
Last Modified: 2026-01-09
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