DoD's $8.1M contract for aircraft spares awarded to Sikorsky Aircraft Corporation, with no competition

Contract Overview

Contract Amount: $8,092,882 ($8.1M)

Contractor: Sikorsky Aircraft Corporation

Awarding Agency: Department of Defense

Start Date: 2023-09-25

End Date: 2026-02-21

Contract Duration: 880 days

Daily Burn Rate: $9.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: REPLENISHMENT SPARES

Place of Performance

Location: STRATFORD, GREATER BRIDGEPORT County, CONNECTICUT, 06615

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $8.1 million to SIKORSKY AIRCRAFT CORPORATION for work described as: REPLENISHMENT SPARES Key points: 1. Value for money is difficult to assess due to lack of competition and limited public data on unit costs. 2. Competition dynamics are non-existent, as this was a sole-source award. 3. Risk indicators include potential for overpricing and lack of market validation due to sole-source nature. 4. Performance context is limited to the delivery of replenishment spares for aircraft. 5. Sector positioning is within the Defense sector, specifically aircraft manufacturing and maintenance.

Value Assessment

Rating: questionable

Assessing value for money is challenging without competitive bids or detailed cost breakdowns. The firm fixed-price contract type offers some cost certainty, but the sole-source nature raises concerns about whether the government secured the best possible price. Benchmarking against similar contracts for specialized aircraft spares is difficult due to proprietary information and the unique nature of such components.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Sikorsky Aircraft Corporation, was considered. This approach bypasses the standard competitive bidding process, which typically involves multiple companies vying for the contract. The lack of competition limits the government's ability to leverage market forces to drive down prices and ensure the most innovative solutions are explored.

Taxpayer Impact: Taxpayers may not be receiving the best value when contracts are awarded without competition, as the potential for higher prices exists without market pressure.

Public Impact

The Department of the Navy benefits from the acquisition of essential aircraft spares. Services delivered include the provision of replenishment parts crucial for maintaining aircraft readiness. Geographic impact is primarily within the operational areas of the U.S. Navy. Workforce implications are likely within Sikorsky Aircraft Corporation's manufacturing and logistics operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Limited transparency into the pricing structure due to sole-source award.
Potential for vendor lock-in if Sikorsky is the sole provider of these specific spares.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established manufacturer like Sikorsky suggests potential for quality and reliability.
Contract supports the operational readiness of critical naval aircraft.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, a significant segment of the U.S. economy. The market for specialized aircraft spares is often characterized by high barriers to entry, proprietary technology, and a limited number of qualified suppliers, which can lead to sole-source procurements. Comparable spending benchmarks are difficult to establish due to the specific nature of replenishment spares for military aircraft.

Small Business Impact

This contract does not appear to involve small business set-asides, as it was awarded directly to Sikorsky Aircraft Corporation. There is no explicit information regarding subcontracting opportunities for small businesses within this award. The impact on the small business ecosystem is likely minimal unless Sikorsky engages them for specific components or services.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations. Accountability measures are inherent in the firm fixed-price structure, which obligates the contractor to deliver specified goods at an agreed-upon price. Transparency is limited due to the sole-source nature of the award, with further details likely residing within internal DoD procurement files.

Related Government Programs

Department of Defense Aircraft Procurement
Naval Aviation Maintenance and Sustainment
Aerospace Manufacturing Contracts
Sole-Source Defense Procurements

Risk Flags

Sole-source award lacks competitive pricing.
Limited public data on cost breakdown and unit pricing.
Potential for higher costs due to lack of market pressure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.1 million to SIKORSKY AIRCRAFT CORPORATION. REPLENISHMENT SPARES

Who is the contractor on this award?

The obligated recipient is SIKORSKY AIRCRAFT CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $8.1 million.

What is the period of performance?

Start: 2023-09-25. End: 2026-02-21.

What is Sikorsky Aircraft Corporation's track record with the Department of Defense, particularly for aircraft spares?

Sikorsky Aircraft Corporation, a subsidiary of Lockheed Martin, has a long and extensive history of contracting with the Department of Defense, particularly for helicopters and related support services. They are a primary contractor for numerous naval aviation platforms. Their track record typically involves large-scale production contracts, sustainment services, and the provision of spare parts. While specific data on their performance for this particular contract is not publicly available, their overall relationship with the DoD is substantial, indicating a deep familiarity with military requirements and procurement processes. Past performance reviews and contract histories within DoD databases would provide more granular insights into their reliability and adherence to contract terms for similar spare parts procurements.

How does the $8.1 million value of this contract compare to similar aircraft spare parts procurements by the Navy?

Direct comparison of this $8.1 million contract for replenishment spares is challenging without knowing the specific aircraft platform and the exact nature of the spares. The value of spare parts contracts can vary dramatically based on the criticality, complexity, and quantity of the items. For major aircraft platforms, annual spending on spares can range from hundreds of thousands to tens of millions of dollars. This $8.1 million figure, spread over the contract's duration, suggests a moderate-sized award for a specific set of components. Without more detailed information on the items being procured and the quantities, it's difficult to benchmark this against other similar procurements to definitively assess value. However, given the sole-source nature, there's an inherent risk that the price might be higher than if it were competitively bid.

What are the primary risks associated with a sole-source award for aircraft spares?

The primary risks associated with a sole-source award for aircraft spares include potential for inflated pricing due to the absence of competitive pressure, reduced incentive for the contractor to innovate or improve efficiency, and a lack of market validation for the price and quality. Taxpayers may end up paying more than necessary. Furthermore, sole-source awards can lead to vendor lock-in, making it difficult and potentially more expensive to switch suppliers in the future if issues arise. There's also a risk that the government might not be aware of alternative, potentially more cost-effective solutions available in the market. Ensuring robust oversight and justification for the sole-source determination is crucial to mitigate these risks.

What is the expected impact of this contract on the operational readiness of naval aircraft?

This contract is intended to directly support the operational readiness of naval aircraft by ensuring the availability of necessary replenishment spares. Aircraft, especially complex military platforms, require a steady supply of parts for routine maintenance, unscheduled repairs, and component replacements. By securing these spares through this contract with Sikorsky Aircraft Corporation, the Department of the Navy aims to minimize aircraft downtime, maintain flight schedules, and ensure that its aviation assets are available when needed for missions. The timely delivery of these spares is critical to preventing operational gaps and maintaining the overall effectiveness of the naval aviation fleet.

How does the 'Aircraft Manufacturing' NAICS code (336411) relate to this contract for replenishment spares?

The North American Industry Classification System (NAICS) code 336411, 'Aircraft Manufacturing,' broadly categorizes establishments primarily engaged in manufacturing aircraft, aircraft parts, and auxiliary equipment. While this contract is specifically for 'REPLENISHMENT SPARES,' it falls under the umbrella of activities typically performed by companies within the aircraft manufacturing sector. Manufacturers like Sikorsky are often the original equipment manufacturers (OEMs) and possess the unique knowledge, tooling, and certifications required to produce or supply genuine replacement parts for the aircraft they build. Therefore, even though it's for spares and not new aircraft production, the NAICS code accurately reflects the industry segment and the likely source of these specialized components.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0001922R0040

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 6900 MAIN ST, STRATFORD, CT, 06614

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: $8,092,882

Exercised Options: $8,092,882

Current Obligation: $8,092,882

Subaward Activity

Number of Subawards: 31

Total Subaward Amount: $2,568,308

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001923D0011

IDV Type: IDC

Timeline