Department of the Navy awards $164.8M delivery order for aircraft parts to Sikorsky Aircraft Corporation

Contract Overview

Contract Amount: $164,871,364 ($164.9M)

Contractor: Sikorsky Aircraft Corporation

Awarding Agency: Department of Defense

Start Date: 2023-01-01

End Date: 2023-10-31

Contract Duration: 303 days

Daily Burn Rate: $544.1K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: H53 PHASE III POP 1 DELIVERY ORDER

Place of Performance

Location: STRATFORD, FAIRFIELD County, CONNECTICUT, 06615

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $164.9 million to SIKORSKY AIRCRAFT CORPORATION for work described as: H53 PHASE III POP 1 DELIVERY ORDER Key points: 1. Contract awarded on a firm-fixed-price basis, providing cost certainty. 2. The contract is a delivery order under a larger indefinite-delivery/indefinite-quantity contract. 3. Sikorsky Aircraft Corporation, a major aerospace manufacturer, is the sole awardee. 4. The contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code. 5. Awarded for a duration of 303 days, indicating a short-term need. 6. The contract was not competed, raising questions about potential price efficiencies. 7. Geographic location of performance is Connecticut.

Value Assessment

Rating: questionable

Benchmarking the value of this specific delivery order is challenging without knowing the terms of the parent IDIQ contract. However, the lack of competition for this particular order suggests potential for overpayment compared to a fully competed scenario. The firm-fixed-price structure offers some cost control, but the absence of competitive bids prevents a direct comparison to market rates for similar aircraft parts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a delivery order under a larger contract that was not competed. As a sole-source award for this specific delivery order, there was no opportunity for multiple bidders to submit proposals. This limits the government's ability to leverage competitive pressures to drive down costs and ensure the best possible value.

Taxpayer Impact: The lack of competition means taxpayers may not be receiving the most cost-effective pricing for these aircraft parts, as there was no bidding process to establish a competitive market rate.

Public Impact

The Department of the Navy benefits from the acquisition of necessary aircraft parts. This contract supports the operational readiness of naval aviation assets. The primary service delivered is the provision of aircraft parts. The geographic impact is concentrated in Connecticut, where Sikorsky Aircraft Corporation is located.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition for this delivery order may lead to higher costs for taxpayers.
Sole-source awards can reduce transparency and accountability in the procurement process.
Reliance on a single supplier could create supply chain risks if issues arise with the contractor.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Sikorsky Aircraft Corporation is a well-established manufacturer with a track record in the aerospace industry.
The contract supports critical defense needs for the Department of the Navy.

Sector Analysis

This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector, a critical component of the broader aerospace and defense industry. The market for aircraft parts is often characterized by specialized manufacturing processes and high technical requirements. Spending in this sector is driven by military readiness, commercial aviation demand, and ongoing research and development. Comparable spending benchmarks would typically involve analyzing other contracts for similar aircraft components awarded to major defense contractors.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no information provided regarding subcontracting plans for small businesses. The award to a large prime contractor like Sikorsky Aircraft Corporation suggests that the primary focus is on direct manufacturing capabilities rather than fostering small business participation through subcontracting opportunities on this specific order.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. As a delivery order under a larger contract, its execution is monitored against the terms of the parent IDIQ. Transparency is limited due to the sole-source nature of this award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Aircraft Procurement
Naval Aviation Support Contracts
Aerospace Manufacturing Contracts
Aircraft Parts and Components Supply

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $164.9 million to SIKORSKY AIRCRAFT CORPORATION. H53 PHASE III POP 1 DELIVERY ORDER

Who is the contractor on this award?

The obligated recipient is SIKORSKY AIRCRAFT 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 $164.9 million.

What is the period of performance?

Start: 2023-01-01. End: 2023-10-31.

What is the historical spending pattern for Sikorsky Aircraft Corporation with the Department of the Navy for similar aircraft parts?

Analyzing historical spending patterns for Sikorsky Aircraft Corporation with the Department of the Navy for similar aircraft parts requires access to comprehensive contract databases. Generally, Sikorsky, as a major helicopter manufacturer (a subsidiary of Lockheed Martin), has a long-standing relationship with the U.S. military, including the Navy. Their contracts often involve the production of helicopters, spare parts, maintenance, and upgrades. Without specific data on this particular NAICS code (336413 - Other Aircraft Parts and Auxiliary Equipment Manufacturing) and contract type (delivery order), it's difficult to provide precise historical figures. However, it is reasonable to assume that spending with Sikorsky for aircraft-related components and services by the Navy has been substantial over the years, reflecting their role as a key defense contractor. Further investigation into contract award histories would be needed to quantify this spending and identify trends or significant shifts.

How does the $164.8 million award compare to other 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' contracts awarded by the Department of the Navy?

The $164.8 million award represents a significant but not exceptionally large sum within the context of defense procurement for aircraft parts. The NAICS code 336413 covers a broad range of components, from engine parts to avionics and structural elements. The Department of the Navy, operating a vast fleet of aircraft, procures substantial quantities of parts annually. Awards in this category can range from a few million dollars for specialized components to hundreds of millions for major sub-assemblies or large-scale production runs. This specific award, being a delivery order under an IDIQ, suggests it's part of a larger, pre-negotiated framework. To provide a precise comparison, one would need to analyze the distribution of contract values within this NAICS code for the Navy over a specific period, looking at both competed and sole-source awards to understand typical pricing and volume.

What are the primary risks associated with a sole-source award for critical aircraft parts?

The primary risks associated with a sole-source award for critical aircraft parts include potential for inflated pricing due to the absence of competitive bidding, reduced incentive for the contractor to innovate or improve efficiency, and increased vulnerability to supply chain disruptions if the sole source faces production issues. Taxpayers may bear a higher cost than if the contract were competed. Furthermore, a sole-source award can limit the government's leverage in negotiating terms and conditions. For critical parts, reliance on a single supplier can also pose a national security risk if that supplier is unable to meet demand or faces geopolitical challenges. The government must rely heavily on its own cost estimation capabilities and the contractor's good faith to ensure fair pricing and timely delivery.

What is Sikorsky Aircraft Corporation's track record in fulfilling Department of the Navy contracts?

Sikorsky Aircraft Corporation, a Lockheed Martin company, has a long and extensive track record of fulfilling contracts for the Department of the Navy. They are a primary manufacturer of naval helicopters, including the MH-60 Seahawk variants, which are critical to naval operations. Their performance history typically involves complex manufacturing, integration, and sustainment services for these advanced platforms. While specific performance metrics for every contract are not publicly detailed, Sikorsky is generally considered a reliable, albeit high-cost, supplier within the defense industrial base. Their ability to deliver sophisticated aircraft and associated components has been crucial for naval aviation readiness. Any issues or delays on major programs are usually well-documented in defense acquisition reports and congressional testimonies.

How does the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector typically perform in terms of value for money?

The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector often presents a mixed picture regarding value for money. On one hand, the specialized nature of aerospace manufacturing, stringent quality control requirements, and the need for highly skilled labor can lead to higher costs. The defense segment, in particular, often involves unique specifications and low-volume production runs, which inherently increase per-unit costs compared to commercial mass production. However, when this sector is subject to robust competition, particularly for more standardized parts or through well-structured IDIQ contracts, significant value for money can be achieved. The challenge lies in ensuring that the procurement processes, especially for sole-source or limited-competition awards, adequately benchmark prices against market rates and incentivize efficiency and innovation from contractors.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 6900 MAIN ST, STRATFORD, CT, 06614

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: $205,915,124

Exercised Options: $205,915,124

Current Obligation: $164,871,364

Subaward Activity

Number of Subawards: 86

Total Subaward Amount: $4,119,778

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0038323DSU01

IDV Type: IDC

Timeline