DoD's $33M V-22 Retrofit Support Contract Awarded Sole-Source to Bell-Boeing

Contract Overview

Contract Amount: $33,135,661 ($33.1M)

Contractor: Bell Boeing Joint Project Office

Awarding Agency: Department of Defense

Start Date: 2023-12-01

End Date: 2026-11-30

Contract Duration: 1,095 days

Daily Burn Rate: $30.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: V-22 RETROFIT INSTALL SUPPORT

Place of Performance

Location: AMARILLO, POTTER County, TEXAS, 79111

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $33.1 million to BELL BOEING JOINT PROJECT OFFICE for work described as: V-22 RETROFIT INSTALL SUPPORT Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential cost efficiencies. 2. The fixed-fee structure may incentivize cost overruns if not closely monitored. 3. Performance period extends over three years, indicating a need for sustained support. 4. The contract is for retrofit installation support, suggesting a focus on maintaining and upgrading existing assets. 5. The awardee, Bell-Boeing, is a joint venture with established expertise in V-22 Osprey programs. 6. The contract value of $33.1 million is significant for specialized aircraft support services.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its sole-source nature and specialized scope. The Cost Plus Fixed Fee (CPFF) pricing structure means the government pays the actual costs plus a fixed fee, which can lead to higher overall costs if the contractor's expenses are not well-managed. Without competitive bids, it's difficult to ascertain if the fixed fee represents a fair profit margin or if the underlying costs are optimized. Comparisons to similar retrofit support contracts for other complex aircraft platforms would be necessary for a more robust value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This typically occurs when only one responsible source can provide the required services, often due to proprietary knowledge, unique capabilities, or existing infrastructure. The lack of competition means that price discovery through market forces was bypassed, potentially leading to higher costs for the government compared to a competitively awarded contract. The justification for a sole-source award would need to be thoroughly reviewed to ensure it aligns with federal procurement regulations.

Taxpayer Impact: Taxpayers may bear a higher cost due to the absence of competitive bidding, as the government did not benefit from price reductions that typically arise from multiple offers.

Public Impact

The U.S. Navy benefits from the continued operational readiness and modernization of its V-22 Osprey fleet. Services delivered include crucial retrofit installation support, ensuring the aircraft meet evolving operational requirements. The geographic impact is primarily within the United States, specifically Texas where the contractor is located. Workforce implications include the employment of skilled technicians and engineers involved in aircraft modification and support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
CPFF contract type can incentivize cost increases if not rigorously managed.
Lack of transparency in the justification for sole-source award.

Positive Signals

Awardee has established expertise with the V-22 platform.
Contract supports critical military aircraft modernization.
Clear performance period defined for support services.

Sector Analysis

The aerospace and defense sector is characterized by high barriers to entry, complex technological requirements, and significant government investment. Contracts for aircraft support, particularly for specialized platforms like the V-22 Osprey, often involve a limited number of highly qualified contractors. The market size for such specialized support is substantial, driven by the need to maintain and upgrade aging fleets and incorporate new technologies. This contract fits within the broader category of aerospace manufacturing and support services, where long-term relationships and technical expertise are paramount.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The prime contractor, Bell-Boeing, is a large joint venture. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear, though large prime contractors are often encouraged or required to utilize small businesses for a portion of their work.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures would be embedded in the contract's terms and conditions, including performance metrics and reporting requirements. Transparency is often limited for sole-source awards, with justifications typically available through specific government portals upon request. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract.

Related Government Programs

V-22 Osprey Procurement
Aircraft Maintenance and Repair Services
Defense Logistics Agency Support Contracts
Naval Air Systems Command (NAVAIR) Contracts

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Potential for cost overruns
Limited transparency in justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.1 million to BELL BOEING JOINT PROJECT OFFICE. V-22 RETROFIT INSTALL SUPPORT

Who is the contractor on this award?

The obligated recipient is BELL BOEING JOINT PROJECT OFFICE.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $33.1 million.

What is the period of performance?

Start: 2023-12-01. End: 2026-11-30.

What is the specific justification for awarding this V-22 retrofit support contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT COMPETED' and 'sole-source'. Federal procurement regulations generally require full and open competition unless specific exceptions apply. Common justifications for sole-source awards include that only one responsible source can provide the required supplies or services, or that the agency's need is of such a nature that it would be seriously impaired without the unique qualifications of the proposed contractor. For the V-22 Osprey, this could be due to proprietary technology, unique manufacturing capabilities held by Bell-Boeing, or the need for continuity of support from the original equipment manufacturer. A detailed justification document, often found in sources like SAM.gov's Contract Opportunities, would outline the specific rationale and supporting evidence for this determination.

How does the Cost Plus Fixed Fee (CPFF) pricing structure compare to other contract types for similar aircraft support services?

Cost Plus Fixed Fee (CPFF) contracts are often used when the scope of work is not precisely defined or involves research and development, making it difficult to estimate costs accurately beforehand. In this structure, the government reimburses the contractor for allowable costs and pays a predetermined fixed fee representing profit. Compared to fixed-price contracts, CPFF offers less cost certainty for the government, as actual costs can fluctuate. However, it can be advantageous when innovation or flexibility is required. For routine maintenance or well-defined retrofits, fixed-price or cost-plus-incentive-fee contracts might offer better value by incentivizing cost control. The choice of CPFF here suggests a perceived need for flexibility or that cost estimation was challenging.

What is the historical spending pattern for V-22 retrofit and support services by the Department of the Navy?

Historical spending on V-22 retrofit and support services by the Department of the Navy has been substantial, reflecting the program's lifecycle and operational demands. The V-22 Osprey is a complex and expensive aircraft, requiring ongoing investment in maintenance, upgrades, and modifications. Prior contracts for similar support have likely been awarded to Bell-Boeing due to their unique position as the manufacturer. Analyzing past contract awards, including their values, durations, and competition levels, would reveal trends in spending. For instance, significant retrofitting efforts may correlate with specific technological upgrades or service life extension programs. Understanding this history provides context for the current $33.1 million award and helps assess if it aligns with previous investment levels.

What are the potential risks associated with a sole-source award for critical aircraft support?

The primary risk associated with a sole-source award for critical aircraft support is the lack of competitive pressure, which can lead to inflated prices and reduced innovation. Without competing offers, the government may not achieve the best possible value for its investment. There's also a risk of contractor complacency, as the absence of competition reduces the incentive to improve efficiency or offer better terms. Furthermore, sole-source awards can raise concerns about fairness and transparency in the procurement process. If the sole-source justification is weak or if alternative solutions were overlooked, taxpayers could be disadvantaged. Robust oversight and negotiation are crucial to mitigate these risks.

How does the contractor's (Bell-Boeing) track record with the V-22 program influence the assessment of this contract's performance potential?

Bell-Boeing's established track record as the manufacturer and primary support provider for the V-22 Osprey program is a significant positive signal for this contract. Their deep understanding of the aircraft's systems, maintenance requirements, and unique operational characteristics suggests a high likelihood of successful performance. This existing expertise minimizes the learning curve and reduces the risk of technical challenges during retrofit installations. However, their sole-source position also means that performance must be rigorously monitored to ensure efficiency and cost-effectiveness, as there is no immediate alternative if performance falters. Their history with the program provides confidence in technical execution but underscores the need for strong government oversight.

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 COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 401 TILTROTOR DR, AMARILLO, TX, 79111

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $43,673,894

Exercised Options: $33,135,661

Current Obligation: $33,135,661

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001922G0002

IDV Type: BOA

Timeline