Boeing awarded $154M for aircraft parts, with delivery orders extending through 2028
Contract Overview
Contract Amount: $154,408,112 ($154.4M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2025-08-25
End Date: 2028-05-22
Contract Duration: 1,001 days
Daily Burn Rate: $154.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: PARTS KIT,LANDING G
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $154.4 million to THE BOEING COMPANY for work described as: PARTS KIT,LANDING G Key points: 1. Contract value appears reasonable given the scope of aircraft parts and support. 2. Full and open competition suggests a healthy market for these components. 3. Long-term contract duration may introduce price escalation risks if not managed. 4. This contract supports ongoing readiness for Navy aircraft. 5. Boeing's established role in defense manufacturing positions them well for this award. 6. Fixed-price contract type shifts some risk to the contractor.
Value Assessment
Rating: good
The contract value of $154 million for aircraft parts is substantial but aligns with the typical costs associated with specialized components for military aviation. Benchmarking against similar sole-source or limited-competition contracts for advanced aircraft parts would be necessary for a precise value-for-money assessment. However, the full and open competition suggests that the pricing is likely competitive within the market for these types of parts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple vendors were likely invited to bid. This process generally leads to a more competitive pricing environment and allows the government to select the best value offer. The number of bidders is not specified, but the competition type suggests a robust market for these aircraft parts.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down prices through market forces, ensuring that the government receives the best possible value for its investment in critical aircraft components.
Public Impact
The U.S. Navy benefits from the reliable supply of essential aircraft parts. This contract ensures the continued operational readiness and maintenance of Navy aircraft fleets. The primary geographic impact is within the United States, supporting domestic manufacturing and supply chains. The contract supports jobs within the aerospace manufacturing sector, particularly at Boeing and its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long-term contract duration could lead to price increases over time if not carefully monitored.
- Reliance on a single primary contractor, Boeing, for a large portion of parts could pose supply chain risks.
- Potential for obsolescence of certain parts over the contract's lifespan if technology evolves rapidly.
Positive Signals
- Full and open competition indicates a healthy and competitive market for these parts.
- Firm fixed-price contract type provides cost certainty for the government.
- Boeing's established expertise in aircraft manufacturing suggests a high likelihood of successful delivery.
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. The market for such components is characterized by high technical requirements, stringent quality control, and significant barriers to entry due to specialized knowledge and manufacturing capabilities. Spending in this area is critical for maintaining national defense capabilities and supporting the operational readiness of military fleets. Comparable spending benchmarks would typically involve analyzing other large-scale contracts for similar aircraft components across different branches of the military.
Small Business Impact
While this contract was awarded to The Boeing Company, there is no explicit indication of a small business set-aside. However, large prime contractors like Boeing are often required to subcontract a portion of their work to small businesses. The extent to which small businesses will participate as subcontractors will be crucial for assessing the contract's impact on the small business ecosystem. Further analysis of subcontracting plans would be needed to determine the specific benefits to small businesses.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Navy's contracting and program management offices. Accountability measures are embedded in the firm fixed-price contract terms, requiring Boeing to deliver specified parts within agreed-upon timelines and quality standards. Transparency is facilitated through contract award databases and reporting requirements. The Inspector General for the Department of Defense may also have jurisdiction for audits and investigations related to potential fraud, waste, or abuse.
Related Government Programs
- Aircraft Maintenance and Repair Services
- Aerospace Component Manufacturing
- Defense Logistics and Supply Chain Management
- Naval Aviation Support Equipment
- Military Aircraft Parts Procurement
Risk Flags
- Long-term contract duration
- Potential for supply chain disruption
- Reliance on a single prime contractor
Tags
defense, department-of-defense, department-of-the-navy, aircraft-parts, landing-gear, full-and-open-competition, firm-fixed-price, delivery-order, boeing, missouri, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $154.4 million to THE BOEING COMPANY. PARTS KIT,LANDING G
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 $154.4 million.
What is the period of performance?
Start: 2025-08-25. End: 2028-05-22.
What is Boeing's historical performance record with the Department of Defense for similar aircraft parts contracts?
Boeing has a long-standing and extensive history of supplying aircraft parts and systems to the Department of Defense, including the Navy. Their track record generally includes successful delivery on numerous large-scale contracts, reflecting their established position as a major defense contractor. However, like any large contractor, there may have been instances of performance issues, delivery delays, or cost overruns on specific contracts. A detailed review of past performance metrics, such as on-time delivery rates, quality compliance, and customer satisfaction scores for similar parts kits and landing gear components, would provide a more granular understanding of their reliability in fulfilling such requirements.
How does the awarded price compare to market rates for similar aircraft parts?
The total award amount of $154,408,112 for 'PARTS KIT,LANDING G' is a significant figure. Without specific part numbers or detailed specifications, a direct market rate comparison is challenging. However, given that this is for aircraft landing gear parts and kits, and awarded under full and open competition, the price is likely reflective of specialized manufacturing, stringent quality control, and the complexity involved. Benchmarking would ideally involve comparing unit prices for identical or highly similar components from other manufacturers or previous government contracts. The firm fixed-price nature suggests the government has negotiated a price that includes anticipated costs and profit, aiming for value.
What are the primary risks associated with this contract, and how are they being mitigated?
Key risks include potential supply chain disruptions, price escalation over the contract's duration (though mitigated by fixed-price), and the risk of parts obsolescence if technology advances rapidly. Mitigation strategies are inherent in the contract structure: the firm fixed-price terms shift cost overrun risk to Boeing. The full and open competition suggests a diversified supplier base, reducing reliance on a single source. The contract's duration (ending 2028) implies that parts must remain relevant and supportable. The Navy's program management will also oversee quality and delivery, with potential remedies for non-performance.
How effective is the firm fixed-price contract type in ensuring value for taxpayers on this contract?
The firm fixed-price (FFP) contract type is generally considered effective for taxpayers when the scope of work is well-defined and the risks are understood. For a contract involving specific 'PARTS KIT,LANDING G,' FFP provides cost certainty for the government, as the contractor assumes the risk of cost overruns. This incentivizes the contractor to manage costs efficiently. However, if unforeseen technical challenges arise or material costs fluctuate significantly, the contractor might have less incentive to proactively address them if it impacts their profit margin. The initial negotiation of the FFP is crucial for ensuring it reflects a fair market value.
What is the historical spending trend for aircraft parts and landing gear components by the Department of Defense?
Historical spending by the Department of Defense on aircraft parts, including landing gear components, has consistently been in the billions of dollars annually. This spending fluctuates based on fleet modernization programs, maintenance schedules, and operational tempo. The Navy, in particular, requires a steady supply of high-quality, reliable parts to maintain its diverse fleet of aircraft. Trends often show increased spending during periods of heightened global security or when introducing new aircraft platforms that require specialized support equipment. Analyzing specific categories like 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (NAICS 336413) over several fiscal years would reveal detailed spending patterns.
What are the implications of the contract's end date (May 2028) for future procurement needs?
The contract's end date of May 22, 2028, signifies that the current procurement vehicle for these specific landing gear parts and kits will expire then. This necessitates that the Department of the Navy begins planning for future requirements well in advance. This could involve initiating a new full and open competition, potentially incorporating updated specifications or technologies, or extending the current contract if provisions allow and it remains advantageous. Early planning ensures continuity of supply and avoids potential gaps that could impact aircraft readiness.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: CHEMICALS AND CHEMICAL PRODUCTS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
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: $315,118,592
Exercised Options: $315,118,592
Current Obligation: $154,408,112
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: N0038322GYY01
IDV Type: BOA
Timeline
Start Date: 2025-08-25
Current End Date: 2028-05-22
Potential End Date: 2028-05-22 00:00:00
Last Modified: 2025-12-17
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