DoD's $28M F404 Engine Parts Contract Awarded to GE Raises Competition Concerns
Contract Overview
Contract Amount: $28,065,726 ($28.1M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2022-01-01
End Date: 2023-04-30
Contract Duration: 484 days
Daily Burn Rate: $58.0K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: F404 PBL PERFORMANCE DELIVERY ORDER 1 JAN 2022 - 31 DEC 2022
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $28.1 million to GENERAL ELECTRIC COMPANY for work described as: F404 PBL PERFORMANCE DELIVERY ORDER 1 JAN 2022 - 31 DEC 2022 Key points: 1. The contract is a performance-based logistics (PBL) delivery order for aircraft engine parts. 2. The sole awardee is General Electric Company, a major defense contractor. 3. The contract value is $28.07 million over a 16-month period. 4. The Public Service Code (PSC) is not specified, hindering detailed sector analysis. 5. The contract was not competed, raising questions about price discovery and value.
Value Assessment
Rating: questionable
The contract is a firm fixed price delivery order. Without a competitive benchmark or detailed cost breakdown, assessing the pricing's value is difficult. The lack of competition suggests potential for inflated costs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded sole-source, meaning it was not competed. This limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to offer competitive pricing.
Taxpayer Impact: The lack of competition for this significant contract may result in higher taxpayer costs due to the absence of price negotiation leverage.
Public Impact
Military readiness may be impacted if engine parts are not procured at the best possible price. Taxpayers may be overpaying for critical aircraft engine components due to the sole-source award. The Department of Defense relies on key contractors like GE for essential aviation support. Transparency in defense contracting is crucial for public trust and efficient use of funds.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
- Limited transparency on cost drivers
Positive Signals
- Performance-based logistics approach
- Award to established, experienced contractor
Sector Analysis
This contract falls under Aircraft Engine and Engine Parts Manufacturing. Defense spending in this sector is substantial, often involving complex, high-value components where competition can be challenging but is crucial for cost control.
Small Business Impact
The awardee, General Electric Company, is a large corporation. There is no indication that small businesses were involved in this specific delivery order, either as subcontractors or prime contractors.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny from oversight bodies to ensure fair pricing and prevent potential waste, fraud, or abuse. A review of the justification for the sole-source award is recommended.
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.
- Potential for cost overruns due to no competition.
- Limited transparency on cost breakdown.
- Need for justification review for sole-source award.
- Impact on small business participation is unclear.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ma, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $28.1 million to GENERAL ELECTRIC COMPANY. F404 PBL PERFORMANCE DELIVERY ORDER 1 JAN 2022 - 31 DEC 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 $28.1 million.
What is the period of performance?
Start: 2022-01-01. End: 2023-04-30.
What is the justification for awarding this contract sole-source to General Electric Company?
The justification for a sole-source award typically involves factors such as unique capabilities, proprietary technology, or urgent requirements where only one source can meet the need. Without access to the specific justification document, it's impossible to determine the precise reasons. However, for high-value, specialized components like aircraft engines, the government often relies on the original equipment manufacturer.
How does the lack of competition impact the overall value for taxpayer money in this contract?
The absence of competition significantly hinders the government's ability to secure the best possible price. Without competing bids, there's less incentive for the contractor to offer cost savings. This can lead to taxpayers potentially overpaying for the goods and services received, as the price may not reflect market value or efficiency gains achievable through a competitive process.
What measures are in place to ensure the performance and quality of the engine parts delivered under this contract?
This contract is designated as Performance-Based Logistics (PBL), which implies that payment is tied to the contractor's achievement of specific performance outcomes, such as availability or reliability of the engine parts. While the sole-source nature affects price discovery, the PBL framework aims to ensure that the contractor is incentivized to deliver quality and maintain readiness.
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: $28,065,726
Exercised Options: $28,065,726
Current Obligation: $28,065,726
Subaward Activity
Number of Subawards: 4
Total Subaward Amount: $732,439
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: N0038319DUS01
IDV Type: IDC
Timeline
Start Date: 2022-01-01
Current End Date: 2023-04-30
Potential End Date: 2023-04-30 00:00:00
Last Modified: 2023-02-27
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