DoD awards $26.7M contract to General Electric for T-700 engine repair, raising competition concerns
Contract Overview
Contract Amount: $26,708,215 ($26.7M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2023-10-01
End Date: 2024-09-30
Contract Duration: 365 days
Daily Burn Rate: $73.2K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: T-700 ENGINES COMPONENT REPAIR (PERFORMANCE BASED LOGISTICS) SUPPORT
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $26.7 million to GENERAL ELECTRIC COMPANY for work described as: T-700 ENGINES COMPONENT REPAIR (PERFORMANCE BASED LOGISTICS) SUPPORT Key points: 1. Significant contract value for specialized engine component repair. 2. Sole reliance on General Electric for critical T-700 engine support. 3. Potential risk of overpricing due to lack of competitive bidding. 4. Spending falls within the Aircraft Engine and Engine Parts Manufacturing sector.
Value Assessment
Rating: questionable
The $26.7 million award for T-700 engine component repair lacks a clear benchmark for comparison due to its sole-source nature. Without competitive bids, it's difficult to assess if the pricing is optimal or inflated.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only General Electric was solicited. This limits price discovery and potentially leads to higher costs for the government compared to a competed contract.
Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for essential T-700 engine repair services.
Public Impact
Ensures continued operational readiness of T-700 powered aircraft. Supports critical maintenance for a key defense asset. Potential for increased costs impacting overall defense budget allocation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for price escalation
Positive Signals
- Performance-based logistics approach
- Ensures critical component availability
Sector Analysis
This contract falls under the Aircraft Engine and Engine Parts Manufacturing sector, a critical area for defense readiness. Spending in this sector can be high due to the specialized nature and high cost of components and repairs.
Small Business Impact
The contract was awarded directly to General Electric Company, a large business. There is no indication of subcontracting opportunities for small businesses in this sole-source award.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure fair pricing and prevent potential waste. Further oversight may be needed to confirm the necessity of this procurement approach.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing.
- Lack of transparency in price discovery.
- Dependency on a single contractor for critical repairs.
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 $26.7 million to GENERAL ELECTRIC COMPANY. T-700 ENGINES COMPONENT REPAIR (PERFORMANCE BASED LOGISTICS) SUPPORT
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 $26.7 million.
What is the period of performance?
Start: 2023-10-01. End: 2024-09-30.
What is the historical cost trend for T-700 engine component repair services provided by General Electric?
Analyzing historical cost data for similar T-700 engine component repair services from General Electric is crucial. Without this data, it's challenging to establish a baseline for fair pricing and identify any significant cost escalations in the current sole-source award. Understanding past performance and pricing trends would provide valuable context for evaluating the current contract's value.
Are there any alternative repair providers or technologies that could be leveraged to introduce competition for T-700 engine components?
Exploring alternative repair providers or innovative technologies is essential to foster competition and potentially reduce costs for T-700 engine component repair. Investigating if other companies possess the capability or if new repair methods can be certified would challenge the sole-source status. This could lead to more competitive bidding in future contract actions.
How does the performance-based logistics (PBL) structure of this contract ensure cost-effectiveness and operational availability?
The performance-based logistics (PBL) structure aims to tie payment to achieved outcomes, such as engine availability or repair turnaround times, rather than just parts or labor. This incentivizes the contractor, General Electric, to optimize their processes for efficiency and reliability. Effective PBL implementation should lead to better value and sustained operational readiness for the T-700 engines.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts 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
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: $131,185,652
Exercised Options: $131,185,652
Current Obligation: $26,708,215
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $280,500
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0038322DZU01
IDV Type: IDC
Timeline
Start Date: 2023-10-01
Current End Date: 2024-09-30
Potential End Date: 2024-09-30 00:00:00
Last Modified: 2024-12-16
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