DoD's $72.1M engine parts contract awarded to General Electric Company for 4 months
Contract Overview
Contract Amount: $72,109,579 ($72.1M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2022-01-01
End Date: 2022-04-30
Contract Duration: 119 days
Daily Burn Rate: $606.0K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: F414 FS PBL DO FOR 1 JAN 2022 - 30 APR 2022
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $72.1 million to GENERAL ELECTRIC COMPANY for work described as: F414 FS PBL DO FOR 1 JAN 2022 - 30 APR 2022 Key points: 1. Contract awarded for aircraft engine parts, indicating a need for specialized manufacturing. 2. The contract duration of 119 days suggests a short-term or bridge requirement. 3. Awarded as a delivery order under an existing contract, potentially streamlining procurement. 4. The firm-fixed-price structure aims to provide cost certainty for the government. 5. No small business set-aside was applied, suggesting the scope may not have been suitable. 6. The North American Industry Classification System (NAICS) code 336412 points to a specific manufacturing niche.
Value Assessment
Rating: fair
The contract value of $72.1 million over approximately four months translates to a monthly burn rate of roughly $18 million. Benchmarking this against similar sole-source or limited-competition contracts for specialized aircraft engine components is challenging without more detailed specifications. However, the firm-fixed-price nature provides some cost control. The base value of $6.06 million for the contract vehicle itself appears relatively low compared to the total value of the delivery order, suggesting this is a significant task order.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded as a delivery order under a sole-source basis, indicating that competition was likely limited or deemed not practicable. The data does not specify the reason for the sole-source award, such as a unique capability of General Electric Company or an urgent need. Without a competitive process, it is difficult to assess if the government received the best possible pricing or if alternative solutions were considered.
Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers if robust price negotiation and market research are not adequately performed due to the lack of competitive pressure.
Public Impact
The Department of the Navy benefits from the continued availability of critical aircraft engine parts. This contract supports the operational readiness of naval aviation assets. The services delivered are specialized manufacturing and parts supply for complex machinery. The geographic impact is primarily within Massachusetts, where General Electric Company is located, and wherever the supplied parts are utilized by the Navy.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition raises concerns about potential overpricing and limited innovation.
- The short duration may indicate a stop-gap measure, potentially leading to future contract instability.
- Reliance on a single source for critical components can create supply chain vulnerabilities.
Positive Signals
- Award to a known entity, General Electric Company, suggests a potentially reliable supplier for specialized parts.
- Firm-fixed-price contract provides budget certainty for this specific order.
- The contract is a delivery order, implying it's part of an existing, potentially pre-vetted, contract vehicle.
Sector Analysis
The aircraft engine and engine parts manufacturing sector (NAICS 336412) is a highly specialized and capital-intensive industry. It involves the production of complex components for jet engines, turboprops, and other aircraft propulsion systems. This sector is characterized by high barriers to entry due to stringent quality requirements, advanced technology, and significant research and development investments. Major players like General Electric Company dominate the market, often holding long-term relationships with defense and aerospace customers. Spending in this area is critical for maintaining national defense capabilities and supporting the aerospace industry.
Small Business Impact
This contract was not set aside for small businesses, nor does it indicate any specific subcontracting requirements for small businesses. Given the specialized nature of aircraft engine parts manufacturing and the award to a large, established prime contractor like General Electric Company, it is likely that the primary work is performed by the prime or its large subcontractors. This contract does not appear to directly benefit the small business ecosystem in this specific instance.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of Defense's contracting and financial management systems. As a delivery order under an existing contract, the initial award and oversight mechanisms of the parent contract would apply. Transparency is facilitated through contract databases like FPDS. Accountability rests with the contracting officers and program managers responsible for ensuring performance and adherence to terms. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.
Related Government Programs
- Aircraft Engine Maintenance, Repair, and Overhaul
- Defense Logistics Agency Procurement
- Naval Aviation Sustainment Programs
- Propulsion Systems Contracts
Risk Flags
- Sole-source award
- Potential for price escalation without competition
- Short contract duration may indicate instability
- Critical component supply chain risk
Tags
defense, department-of-defense, department-of-the-navy, aircraft-engine-parts, manufacturing, sole-source, firm-fixed-price, delivery-order, general-electric-company, massachusetts, naics-336412
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $72.1 million to GENERAL ELECTRIC COMPANY. F414 FS PBL DO FOR 1 JAN 2022 - 30 APR 2022
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $72.1 million.
What is the period of performance?
Start: 2022-01-01. End: 2022-04-30.
What is the historical spending pattern for aircraft engine parts from General Electric Company by the Department of Defense?
Analyzing historical spending requires access to comprehensive contract databases beyond this single delivery order. However, General Electric Company is a major defense contractor, particularly in aviation propulsion. The Department of Defense (DoD) has consistently awarded significant contracts to GE for engines, parts, and related services over many years. This specific $72.1 million order for a four-month period represents a portion of that ongoing relationship. To understand the full pattern, one would need to examine total contract obligations to GE for similar parts across different fiscal years and agencies within the DoD, looking for trends in volume, value, and contract types (e.g., sole-source vs. competitive).
How does the pricing of this contract compare to similar sole-source awards for aircraft engine parts?
Direct price comparison for sole-source contracts is inherently difficult without access to the specific technical specifications, quantities, and negotiated rates for comparable items. The firm-fixed-price nature of this $72.1 million order for General Electric Company's engine parts provides cost certainty for this period. However, without knowing the exact parts, their criticality, and the market dynamics for those specific components, benchmarking against other sole-source awards is speculative. A thorough assessment would involve comparing unit prices, if available, against historical data for similar parts or against prices charged to other government agencies or commercial customers, assuming such data is accessible and comparable.
What are the key risks associated with awarding a sole-source contract for critical aircraft engine parts?
The primary risks associated with sole-source awards for critical components like aircraft engine parts include potential overpricing due to lack of competition, reduced incentive for the contractor to innovate or improve efficiency, and increased vulnerability in the supply chain. If General Electric Company is the only source capable of producing these specific parts, the government is dependent on their production capacity and pricing. Furthermore, a sole-source award might signal a lack of available alternatives or a failure in market research to identify potential competitors, which could lead to suboptimal value for taxpayer dollars. There's also a risk of vendor lock-in, making future transitions difficult or costly.
What is the expected performance outcome or program effectiveness tied to this contract?
The expected performance outcome for this contract is the timely delivery of specified aircraft engine parts to the Department of the Navy, ensuring the operational readiness and maintenance capabilities of naval aviation assets. The effectiveness is measured by the quality and reliability of the parts supplied, adherence to delivery schedules, and the overall contribution to maintaining the fleet's operational status. Since this is a parts supply contract, its effectiveness is directly linked to preventing aircraft downtime and supporting flight missions. The firm-fixed-price structure aims to ensure cost-effective delivery of these essential components.
What is the track record of General Electric Company in fulfilling similar DoD contracts for aircraft engine parts?
General Electric Company (GE) has a long and extensive track record as a major supplier of aircraft engines and parts to the Department of Defense (DoD) and other government agencies. They are a primary original equipment manufacturer (OEM) for numerous military aircraft platforms. Historically, GE has demonstrated capability in producing and delivering complex engine components. While specific performance metrics for every contract are not publicly detailed, GE's continued role as a key supplier suggests a generally reliable performance history in meeting the demanding requirements of military aviation. However, like any large contractor, specific contract performance can vary.
What is the total spending on aircraft engine parts manufacturing (NAICS 336412) by the Department of Defense over the last five years?
Determining the precise total spending for NAICS code 336412 by the Department of Defense (DoD) over the last five years requires a comprehensive data query across federal procurement databases. This specific contract represents a small fraction of that potential total. The DoD spends billions annually on aircraft, engines, and related parts, with a significant portion likely falling under this manufacturing code. This spending fluctuates based on modernization programs, operational tempo, and sustainment needs. A detailed analysis would involve aggregating all contracts awarded under NAICS 336412 by the DoD, filtering by relevant timeframes, and excluding non-parts related procurements within the broader category.
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
Address: 1000 WESTERN AVE, LYNN, MA, 01905
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: $72,109,579
Exercised Options: $72,109,579
Current Obligation: $72,109,579
Subaward Activity
Number of Subawards: 7
Total Subaward Amount: $3,203,311
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: N0038318DP601
IDV Type: IDC
Timeline
Start Date: 2022-01-01
Current End Date: 2022-04-30
Potential End Date: 2022-05-30 00:00:00
Last Modified: 2022-07-25
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