Boeing awarded $24.4M for inner wing sections, highlighting sole-source procurement in defense manufacturing
Contract Overview
Contract Amount: $24,378,970 ($24.4M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2024-07-29
End Date: 2027-04-26
Contract Duration: 1,001 days
Daily Burn Rate: $24.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: WING SECTION,INNER
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $24.4 million to THE BOEING COMPANY for work described as: WING SECTION,INNER Key points: 1. Contract awarded to a single, established supplier, raising questions about competitive pricing. 2. Focus on critical aircraft components underscores the importance of supply chain stability. 3. Long-term contract duration suggests a sustained need for these specific parts. 4. Fixed-price contract structure aims to control costs, but initial price needs benchmarking. 5. Sole-source nature limits opportunities for new entrants and potentially higher innovation. 6. Geographic concentration in Missouri for manufacturing may present logistical considerations.
Value Assessment
Rating: fair
The contract value of $24.4 million for inner wing sections appears substantial. Without specific details on the quantity of wing sections or the exact specifications, a direct comparison to similar contracts is challenging. However, given the sole-source nature, it is crucial to benchmark the pricing against historical data for similar components from Boeing or other major defense contractors to ensure fair value. The firm fixed-price structure provides cost certainty for the government, but the absence of competition means the price may not reflect the most economical market rate.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, The Boeing Company, was solicited. This approach is typically used when a specific capability or product is only available from a single source, or in cases of urgent and compelling need. The lack of competition means that price discovery through a bidding process did not occur, potentially leading to a higher price than if multiple vendors had competed.
Taxpayer Impact: The sole-source award means taxpayers did not benefit from the cost savings that can arise from a competitive bidding process. This could result in a higher overall expenditure for these critical aircraft components.
Public Impact
The primary beneficiary is the Department of the Navy, ensuring the continued availability of critical aircraft components. Services delivered include the manufacturing and supply of inner wing sections for unspecified aircraft. The geographic impact is concentrated in Missouri, where The Boeing Company's facility will undertake the work. Workforce implications include the potential for sustained employment at Boeing's Missouri plant.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement limits competitive pressure, potentially inflating costs.
- Lack of transparency in the sole-source justification requires careful review.
- Long contract duration could lead to price escalation if not managed effectively.
Positive Signals
- Firm fixed-price contract provides cost certainty.
- Award to established contractor, Boeing, suggests reliability and proven capability.
- Focus on critical aircraft parts ensures operational readiness for naval aviation.
Sector Analysis
This contract falls within the aerospace manufacturing sector, specifically focusing on aircraft parts. The market for specialized aircraft components, particularly for defense applications, is often characterized by high barriers to entry, significant R&D investment, and a limited number of qualified suppliers. Major defense contractors like Boeing dominate this space. Spending in this sub-sector is driven by military readiness requirements and the lifecycle support of existing aircraft fleets. Comparable spending benchmarks would involve analyzing other sole-source or competitively awarded contracts for similar high-value aircraft components.
Small Business Impact
This contract does not appear to involve a small business set-aside, as it was awarded to The Boeing Company, a large aerospace manufacturer. There is no explicit indication of subcontracting plans for small businesses within the provided data. The absence of a set-aside means that opportunities for small businesses to participate in this specific contract are limited, and their role in the broader supply chain for these wing sections is not detailed.
Oversight & Accountability
Oversight for this contract will be managed by the Department of the Navy, likely through contracting officers and program managers. Accountability measures are inherent in the firm fixed-price contract type, which obligates Boeing to deliver the specified wing sections at the agreed-upon price. Transparency regarding the sole-source justification and performance metrics would be subject to federal procurement regulations and agency policies. The Inspector General's office for the Department of Defense may conduct audits or investigations if concerns arise regarding contract performance or pricing.
Related Government Programs
- Aircraft Parts Manufacturing
- Defense Procurement
- Naval Aviation Support
- Aerospace Supply Chain
Risk Flags
- Sole-source procurement
- Lack of competitive bidding
- Potential for unbenchmarked pricing
Tags
defense, department-of-the-navy, missouri, sole-source, firm-fixed-price, aircraft-parts, aerospace, manufacturing, delivery-order, large-contractor
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $24.4 million to THE BOEING COMPANY. WING SECTION,INNER
Who is the contractor on this award?
The obligated recipient is THE BOEING 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 $24.4 million.
What is the period of performance?
Start: 2024-07-29. End: 2027-04-26.
What is the specific aircraft platform these inner wing sections are intended for, and what is the quantity being procured?
The provided data does not specify the exact aircraft platform for which these inner wing sections are intended, nor does it state the quantity. This information is crucial for a comprehensive value assessment, as different aircraft platforms have vastly different component requirements and costs. Understanding the quantity is essential for calculating a meaningful per-unit cost and comparing it against industry benchmarks. Without this context, it is difficult to determine if the $24.4 million award represents a fair price for the volume and complexity of the parts being acquired.
What was the justification for awarding this contract on a sole-source basis to The Boeing Company?
The justification for a sole-source award typically falls under specific exceptions to full and open competition, such as the availability of the item from only one responsible source, or an urgent and compelling need. For a critical component like an inner wing section, the justification might relate to proprietary design, specialized manufacturing capabilities held exclusively by Boeing, or the need to maintain commonality with existing fleet aircraft. A thorough review of the official Justification and Approval (J&A) document would be necessary to understand the precise rationale and ensure it aligns with federal procurement regulations.
How does the pricing of these inner wing sections compare to similar components procured competitively or from other suppliers?
Direct price comparison is challenging without knowing the exact specifications, quantity, and aircraft platform. However, as a sole-source award to a major contractor like Boeing, there is a risk that the price may be higher than if the contract had been competed. To assess value, one would need to benchmark the proposed price against historical data for similar wing sections, analyze Boeing's cost structure if available, or compare it to prices paid by other military branches or allied nations for comparable components. The firm fixed-price nature provides cost certainty but does not inherently guarantee the lowest possible price.
What are the key performance metrics and delivery milestones outlined in the contract?
The provided data indicates a contract duration from July 29, 2024, to April 26, 2027, spanning approximately 1001 days. While this gives a timeframe, specific performance metrics and detailed delivery milestones are not included. Key performance indicators (KPIs) would typically involve quality standards (e.g., defect rates), on-time delivery schedules for specific batches of wing sections, and adherence to technical specifications. The Department of the Navy would monitor these aspects to ensure contract compliance and operational readiness.
What is Boeing's historical performance record with the Department of the Navy for similar aircraft components?
The Boeing Company is a long-standing and major defense contractor with extensive experience supplying aircraft components to the Department of the Navy. Historically, Boeing has a significant track record, often involving large-scale production and complex systems. While specific performance metrics for this exact component type are not detailed here, Boeing's overall performance is generally considered robust, though like any large contractor, they may have experienced occasional delivery delays or quality issues on specific programs. A deeper dive into past contract performance evaluations (e.g., CPARS) would provide a more granular assessment.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JAMES S MCDONNELL BLVD, SAINT LOUIS, MO, 63134
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: $49,753,000
Exercised Options: $49,753,000
Current Obligation: $24,378,970
Subaward Activity
Number of Subawards: 5
Total Subaward Amount: $10,158,915
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: N0038322GYY01
IDV Type: BOA
Timeline
Start Date: 2024-07-29
Current End Date: 2027-04-26
Potential End Date: 2027-04-26 00:00:00
Last Modified: 2025-12-05
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