DoD Awards $74.3M for STOVL Spares to RTX Corp, Lacking Competition
Contract Overview
Contract Amount: $74,291,175 ($74.3M)
Contractor: RTX Corporation
Awarding Agency: Department of Defense
Start Date: 2024-09-30
End Date: 2027-12-31
Contract Duration: 1,187 days
Daily Burn Rate: $62.6K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DEPOT STOVL SPARES
Place of Performance
Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06118
Plain-Language Summary
Department of Defense obligated $74.3 million to RTX CORPORATION for work described as: DEPOT STOVL SPARES Key points: 1. Significant award to a single large contractor (RTX Corporation). 2. No competition was cited, raising potential price concerns. 3. The contract is for aircraft engine and parts manufacturing. 4. Long duration (1187 days) suggests a sustained need. 5. High value award warrants scrutiny for cost-effectiveness.
Value Assessment
Rating: questionable
The award value of $74.3 million for STOVL spares is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market alternatives or previous contracts for similar components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This method limits price discovery and may result in higher costs for taxpayers as there is no market pressure to drive down prices.
Taxpayer Impact: The lack of competition for this significant contract could lead to inflated prices, directly impacting taxpayer funds negatively.
Public Impact
Taxpayers may be overpaying for critical STOVL aircraft components due to the absence of competitive bidding. The long contract duration could lock in potentially non-optimal pricing for years. Dependence on a single supplier for essential parts could pose supply chain risks.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High contract value
- Long contract duration
Positive Signals
- Addresses critical need for STOVL spares
- Award to established defense contractor
Sector Analysis
This contract falls within the Defense sector, specifically Aircraft Engine and Engine Parts Manufacturing. Spending in this area is critical for military readiness, but competitive procurement is essential to ensure value for money.
Small Business Impact
The contract was awarded to RTX Corporation, a large prime contractor. There is no indication of small business participation or subcontracting in the provided data, suggesting limited direct benefit to small businesses.
Oversight & Accountability
The sole-source nature of this award warrants close oversight from the Department of Defense to ensure fair pricing and prevent potential waste, fraud, or abuse. Transparency in future procurements is crucial.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award lacks competitive pricing pressure.
- Potential for overpayment due to lack of competition.
- Long contract duration may lock in unfavorable pricing.
- Limited transparency on price justification.
- Potential supply chain risk due to single supplier.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ct, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $74.3 million to RTX CORPORATION. DEPOT STOVL SPARES
Who is the contractor on this award?
The obligated recipient is RTX 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 $74.3 million.
What is the period of performance?
Start: 2024-09-30. End: 2027-12-31.
What is the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where competition is not feasible. The Department of Defense should have conducted a price analysis, potentially using historical data, cost breakdowns, or independent government cost estimates, to validate the reasonableness of the price. However, without competition, the inherent pressure to achieve the lowest possible price is absent.
What are the potential risks associated with relying solely on RTX Corporation for these critical STOVL spares over the contract's duration?
The primary risks include potential price escalation over the contract term, limited flexibility to adopt newer or more cost-effective technologies if they emerge, and potential supply chain vulnerabilities if RTX faces production issues. A sole-source arrangement can also reduce leverage in negotiations for future contracts or modifications, potentially leading to sustained higher costs.
How does this contract contribute to the operational readiness and long-term sustainment of STOVL aircraft, and is the value proposition justified?
This contract directly supports the sustainment of STOVL aircraft by providing necessary spare parts, which is crucial for maintaining operational readiness. The value proposition is justified if these parts are essential and unavailable elsewhere, and if the price, despite being non-competitive, reflects a fair market value determined through rigorous analysis. However, the lack of competition makes it difficult to definitively confirm optimal value.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: ENGINES AND TURBINES AND COMPONENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp
Address: 400 MAIN ST, EAST HARTFORD, CT, 06118
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: $74,291,175
Exercised Options: $74,291,175
Current Obligation: $74,291,175
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0001920D0013
IDV Type: IDC
Timeline
Start Date: 2024-09-30
Current End Date: 2027-12-31
Potential End Date: 2027-12-31 00:00:00
Last Modified: 2025-12-09
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