DoD Awards $26M for Aircraft Engineering Support, Sole-Sourced to General Atomics

Contract Overview

Contract Amount: $25,952,899 ($26.0M)

Contractor: General Atomics Aeronautical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2025-08-15

End Date: 2026-08-14

Contract Duration: 364 days

Daily Burn Rate: $71.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING SUPPORT SUSTAINMENT

Place of Performance

Location: POWAY, SAN DIEGO County, CALIFORNIA, 92064

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $26.0 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC. for work described as: ENGINEERING SUPPORT SUSTAINMENT Key points: 1. Significant contract value for specialized engineering support. 2. Sole-source award raises questions about competition and potential cost savings. 3. Risk associated with single-vendor reliance for critical sustainment. 4. Aircraft manufacturing sector sees substantial investment.

Value Assessment

Rating: questionable

The contract is a Cost Plus Fixed Fee type, which can lead to cost overruns if not managed tightly. Benchmarking against similar engineering support contracts is difficult without more detailed cost breakdowns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and may result in higher costs for taxpayers compared to a competitive process.

Taxpayer Impact: The lack of competition for this $26M contract means taxpayers may not be receiving the best possible price for these engineering services.

Public Impact

Ensures continued operational readiness for naval aircraft. Supports a key defense contractor, potentially impacting jobs. Limited transparency on how the fixed fee was determined.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost-plus contract type
Lack of competition

Positive Signals

Essential sustainment for critical assets
Long-term support relationship

Sector Analysis

This contract falls within the aerospace and defense sector, specifically supporting aircraft sustainment. Spending in this area is crucial for maintaining military readiness, but competitive bidding is vital for cost efficiency.

Small Business Impact

The awardee is a large business, and there is no indication of small business participation in this specific contract. Opportunities for small businesses in the defense supply chain are often indirect.

Oversight & Accountability

The Department of the Navy is responsible for oversight. The cost-plus fixed-fee structure necessitates robust oversight to control costs and ensure value for money.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Lack of competition
Cost-plus contract type
Potential for cost overruns
Limited transparency on pricing
Reliance on a single vendor

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.0 million to GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC.. ENGINEERING SUPPORT SUSTAINMENT

Who is the contractor on this award?

The obligated recipient is GENERAL ATOMICS AERONAUTICAL SYSTEMS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $26.0 million.

What is the period of performance?

Start: 2025-08-15. End: 2026-08-14.

What is the justification for the sole-source award, and were alternative competitive strategies considered?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without further details, it's difficult to assess if all avenues for competition were exhausted. Agencies must demonstrate why a competitive process was not feasible to ensure taxpayer funds are used efficiently.

How does the fixed fee component compare to industry benchmarks for similar engineering support services?

Assessing the fixed fee requires detailed cost data and comparison with similar contracts. Without this granular information, it's challenging to determine if the fee is reasonable. Benchmarking against other sole-source or competitively awarded contracts for comparable services would be necessary for a thorough evaluation.

What mechanisms are in place to ensure cost control and prevent overruns in this Cost Plus Fixed Fee contract?

Cost Plus Fixed Fee contracts require stringent oversight. Mechanisms typically include detailed cost tracking, regular audits, performance reviews, and clear limitations on allowable costs. The agency must actively manage the contractor's performance and expenditures to mitigate the inherent risk of cost escalation.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD 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: 14200 KIRKHAM WAY, POWAY, CA, 92064

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: $77,049,065

Exercised Options: $35,114,050

Current Obligation: $25,952,899

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $87,425

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001922G0006

IDV Type: BOA

Timeline