DoD awards $5.36M for aircraft oxygen systems, with limited competition and a fixed price contract
Contract Overview
Contract Amount: $5,360,341 ($5.4M)
Contractor: ECI Defense Group, Inc.
Awarding Agency: Department of Defense
Start Date: 2025-12-23
End Date: 2026-12-23
Contract Duration: 365 days
Daily Burn Rate: $14.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: BOTTLE OXYGEN,AIRCR
Place of Performance
Location: LAWRENCEVILLE, GWINNETT County, GEORGIA, 30043
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $5.4 million to ECI DEFENSE GROUP, INC. for work described as: BOTTLE OXYGEN,AIRCR Key points: 1. The contract value of $5.36 million for aircraft oxygen systems appears reasonable for a two-year duration. 2. Limited competition for this specialized equipment may impact price competitiveness. 3. The firm fixed-price contract shifts risk to the contractor, potentially leading to higher initial costs. 4. This contract supports the Department of the Navy's aviation readiness and maintenance. 5. The supplier, ECI Defense Group, Inc., operates within the aircraft parts manufacturing sector.
Value Assessment
Rating: good
The contract value of $5.36 million for 365 days of service is within a reasonable range for specialized aircraft components. Benchmarking against similar contracts for oxygen systems is difficult without more specific technical details, but the fixed-price nature suggests a clear understanding of costs. The absence of a specific dollar amount for the base year makes a precise per-unit cost comparison challenging, but the overall value seems aligned with industry standards for such equipment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not competed on a full and open basis, indicating potential limitations in the bidding process. The specific reason for this limited competition is not detailed, but it could be due to specialized requirements, existing relationships, or a lack of qualified bidders. With only one award, it's difficult to assess the full impact on price discovery, but it suggests a less competitive environment than a multi-bidder scenario.
Taxpayer Impact: Limited competition may result in taxpayers paying a premium compared to a fully competed contract, as the government may have fewer options to negotiate the best price.
Public Impact
This contract directly benefits the U.S. Navy by ensuring the availability of critical oxygen systems for its aircraft fleet. The services delivered include the provision of essential aircraft parts, contributing to flight safety and operational readiness. The geographic impact is primarily within the operational theaters of the U.S. Navy, with parts likely distributed to various bases and deployed units. This contract supports jobs within the aerospace manufacturing sector, specifically in the production of aircraft components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition could lead to higher prices for taxpayers.
- Lack of transparency in the procurement process raises questions about best value.
- Reliance on a single source for critical components could pose supply chain risks.
Positive Signals
- Firm fixed-price contract effectively transfers cost overrun risk to the contractor.
- Contract duration of one year provides a defined period for supply.
- Award to an established defense contractor suggests a level of reliability.
Sector Analysis
The aerospace and defense manufacturing sector is characterized by high technological barriers to entry and stringent quality requirements. This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sub-sector, which is a critical component of the broader defense industrial base. Spending in this area is driven by military readiness needs and modernization programs. Comparable spending benchmarks would typically involve analyzing contracts for similar aircraft components across different branches of the military.
Small Business Impact
This contract was not set aside for small businesses, nor does it indicate any specific subcontracting requirements for small businesses. The award to ECI Defense Group, Inc., a presumably larger entity, suggests that small businesses may not have been primary participants in this specific procurement. Further analysis would be needed to determine if ECI Defense Group has a history of subcontracting with small businesses.
Oversight & Accountability
The contract is subject to standard Department of Defense oversight mechanisms. Accountability is maintained through the firm fixed-price structure, which obligates the contractor to deliver specified goods within the agreed-upon cost. Transparency is limited due to the non-competitive nature of the award. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Aircraft Parts Manufacturing
- Aerospace Defense Contracts
- Department of the Navy Procurement
- Air Force Aircraft Support Equipment
Risk Flags
- Limited Competition
- Lack of Transparency
- Potential for Overpricing
Tags
defense, department-of-defense, department-of-the-navy, aircraft-parts, oxygen-systems, firm-fixed-price, not-competed, georgia, ecidefensegroupinc, aerospace-manufacturing
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $5.4 million to ECI DEFENSE GROUP, INC.. BOTTLE OXYGEN,AIRCR
Who is the contractor on this award?
The obligated recipient is ECI DEFENSE GROUP, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $5.4 million.
What is the period of performance?
Start: 2025-12-23. End: 2026-12-23.
What is the specific type of aircraft oxygen system being procured, and what are its critical performance specifications?
The provided data does not specify the exact type of aircraft oxygen system or its critical performance specifications. The North American Industry Classification System (NAICS) code 336413, 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' indicates a broad category. To provide a detailed answer, access to the contract's statement of work (SOW) or technical specifications would be necessary. This information is crucial for understanding the complexity of the system, its intended use (e.g., fighter jets, transport planes, helicopters), and the technical expertise required for its manufacturing and supply. Without these details, it's challenging to assess the appropriateness of the price or the contractor's capabilities beyond general industry knowledge.
What is the historical spending pattern for aircraft oxygen systems by the Department of the Navy?
Historical spending data for aircraft oxygen systems by the Department of the Navy is not directly available in the provided summary. To analyze this, one would typically query federal procurement databases (like FPDS or USASpending) using relevant Product Service Codes (PSCs) or NAICS codes associated with oxygen systems and aircraft parts. This would reveal trends in contract values, awardees, and competition levels over previous fiscal years. Understanding historical spending helps in benchmarking current contract values, identifying potential price escalations, and assessing the consistency of procurement strategies for these critical components. A significant increase or decrease in spending could indicate changes in fleet size, modernization efforts, or supply chain dynamics.
What is the track record of ECI Defense Group, Inc. in supplying aircraft components to the U.S. military?
ECI Defense Group, Inc. has a track record of supplying various components and services to the U.S. military, as indicated by its presence in federal procurement data. To assess its specific performance related to aircraft oxygen systems, a deeper dive into its contract history would be required. This would involve examining past awards for similar items, on-time delivery rates, quality performance metrics (if available), and any past performance issues or disputes. A review of their financial stability and certifications relevant to aerospace manufacturing would also be prudent. Generally, established defense contractors have experience navigating complex military requirements, but individual contract performance can vary.
What are the specific risks associated with a 'NOT COMPETED' contract for critical aircraft parts?
A 'NOT COMPETED' contract, as seen here, carries several risks. Primarily, it limits the government's ability to secure the best possible price through competitive bidding, potentially leading to higher costs for taxpayers. It can also reduce innovation, as contractors may have less incentive to offer cost-saving or performance-enhancing solutions when competition is absent. Furthermore, it raises concerns about fairness and transparency in the procurement process. If the sole source or limited source justification is weak, it could indicate potential favoritism or a lack of market research. For critical aircraft parts, reliance on a single, non-competed source can also create supply chain vulnerabilities if that contractor faces production issues or goes out of business.
How does the firm fixed-price (FFP) contract type impact the government's risk and potential for cost savings in this scenario?
A Firm Fixed-Price (FFP) contract type, like the one awarded here, places the primary responsibility for cost overruns on the contractor, ECI Defense Group, Inc. This is generally advantageous for the government as it provides cost certainty and predictability. The government knows the total price upfront, assuming the contractor meets all contract requirements. This structure incentivizes the contractor to manage its costs efficiently to maximize profit. However, for highly specialized or uncertain requirements, an FFP contract might lead to a higher initial price to compensate the contractor for taking on more risk. In this case, for aircraft oxygen systems, the requirements are likely well-defined, making FFP a suitable choice for managing budget and risk.
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
Solicitation ID: N0038325RB261
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 970 PROGRESS CENTER AVE, LAWRENCEVILLE, GA, 30043
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $5,360,341
Exercised Options: $5,360,341
Current Obligation: $5,360,341
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2025-12-23
Current End Date: 2026-12-23
Potential End Date: 2026-12-23 00:00:00
Last Modified: 2025-12-31
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