DoD Awards $57M for USMC Engine Repair to Rolls-Royce, Spanning Two Years

Contract Overview

Contract Amount: $57,162,643 ($57.2M)

Contractor: Rolls-Royce Corporation

Awarding Agency: Department of Defense

Start Date: 2024-10-23

End Date: 2026-07-31

Contract Duration: 646 days

Daily Burn Rate: $88.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DEPOT LEVEL ENGINE REPAIR CY3 USMC ACTIVE FY25

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46225

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $57.2 million to ROLLS-ROYCE CORPORATION for work described as: DEPOT LEVEL ENGINE REPAIR CY3 USMC ACTIVE FY25 Key points: 1. Significant contract value for depot-level engine repair services. 2. Rolls-Royce Corporation is the sole awardee, indicating a specific capability or existing relationship. 3. Potential risk associated with single-source awards if competition was not fully explored. 4. Spending falls within the Defense sector, specifically for aircraft engine maintenance.

Value Assessment

Rating: good

The award amount of $57.2 million over two years for depot-level engine repair appears reasonable given the specialized nature of aircraft engine maintenance. Benchmarking against similar complex repair contracts would provide further validation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting multiple vendors had the opportunity to bid. The use of a delivery order under an existing contract mechanism implies a structured price discovery process.

Taxpayer Impact: Taxpayer funds are being used for essential military readiness, with competition aiming to secure fair pricing for critical repair services.

Public Impact

Ensures readiness of USMC aircraft by maintaining critical engine components. Supports specialized manufacturing and repair jobs within the aerospace sector. Contributes to the operational capability of the U.S. Marine Corps.

Waste & Efficiency Indicators

Waste Risk Score: 88 / 10

Positive Signals

Full and open competition utilized.
Firm Fixed Price contract type mitigates cost overrun risk.
Long-term award supports sustained operational readiness.

Sector Analysis

This contract falls within the Defense sector, specifically focusing on the maintenance and repair of aircraft engines. Spending benchmarks for depot-level maintenance can vary widely based on aircraft type and complexity, but this award represents a significant investment in fleet readiness.

Small Business Impact

While the primary awardee is a large corporation, the contract may indirectly benefit small businesses through subcontracting opportunities for specialized parts or services. Further analysis would be needed to confirm any direct small business participation.

Oversight & Accountability

The Department of the Navy's award process, utilizing full and open competition, suggests adherence to standard oversight procedures. Monitoring delivery performance and adherence to contract terms will be key accountability measures.

Related Government Programs

Aircraft Engine and Engine Parts Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Potential for price creep in future contract actions.
Dependency on a single supplier for critical maintenance.
Limited visibility into subcontracting opportunities for small businesses.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $57.2 million to ROLLS-ROYCE CORPORATION. DEPOT LEVEL ENGINE REPAIR CY3 USMC ACTIVE FY25

Who is the contractor on this award?

The obligated recipient is ROLLS-ROYCE 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 $57.2 million.

What is the period of performance?

Start: 2024-10-23. End: 2026-07-31.

What specific factors contributed to Rolls-Royce Corporation being the sole awardee under full and open competition for this engine repair contract?

While awarded under full and open competition, the specific factors leading to a single awardee could include highly specialized technical requirements, unique proprietary repair processes, or the need for extensive, costly retooling for new vendors. The government likely assessed that only Rolls-Royce possessed the necessary certifications, expertise, and infrastructure to meet the stringent performance and timeline demands for depot-level engine repair.

What are the primary risks associated with a single awardee for critical depot-level engine repair, even under full and open competition?

Even with full and open competition, a single awardee presents risks such as potential price escalation in future contract renewals due to reduced market pressure. There's also a dependency risk; if the sole provider faces production issues or financial instability, it could severely impact military readiness. Furthermore, the government might miss out on innovative solutions or cost efficiencies that could emerge from a more diverse supplier base.

How does this contract contribute to the overall effectiveness and readiness of the USMC aviation fleet?

This contract is crucial for maintaining the operational effectiveness of the USMC aviation fleet by ensuring that critical aircraft engines receive specialized depot-level repair. Timely and high-quality engine maintenance directly translates to aircraft availability, mission capability, and pilot safety. By securing these services, the USMC can sustain its operational tempo and meet its global deployment commitments.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0001921R0014

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rolls-Royce Holdings PLC

Address: 450 S MERIDIAN ST, INDIANAPOLIS, IN, 46225

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $57,162,643

Exercised Options: $57,162,643

Current Obligation: $57,162,643

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001922D0011

IDV Type: IDC

Timeline