DoD's $19.8M contract for aircraft engines and parts awarded to General Electric Company
Contract Overview
Contract Amount: $19,844,296 ($19.8M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2025-01-01
End Date: 2027-03-30
Contract Duration: 818 days
Daily Burn Rate: $24.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: 2025 MPPST, RDT&E
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $19.8 million to GENERAL ELECTRIC COMPANY for work described as: 2025 MPPST, RDT&E Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, indicating potential for cost overruns. 2. Sole-source award limits competitive pressure, potentially impacting price efficiency. 3. Long performance period of 818 days suggests a significant, ongoing need. 4. Awarded by the Department of the Navy, indicating a defense-centric application. 5. The contract falls under the Aircraft Engine and Engine Parts Manufacturing sector.
Value Assessment
Rating: questionable
The contract's cost-plus-fixed-fee structure warrants scrutiny, as it can incentivize higher spending by the contractor. Benchmarking against similar sole-source awards for aircraft engines and parts is difficult without more specific technical details. However, the base value of $19.8 million for a duration of over two years suggests a substantial investment. Without competitive bidding, it's challenging to definitively assess if this represents optimal value for money, but the lack of competition raises concerns about potential overpricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed. This typically occurs when only one responsible source can provide the required goods or services. The lack of competition means that the government did not benefit from a range of proposals and pricing strategies that would typically emerge from a competitive bidding process. This can limit the government's ability to secure the most favorable terms and pricing.
Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pricing. The government's negotiating position is weakened without alternative sources to consider.
Public Impact
The Department of the Navy benefits from the acquisition of critical aircraft engine components. This contract supports the operational readiness and maintenance of naval aviation assets. The primary beneficiaries are the military personnel who rely on these aircraft for national security missions. The contract has implications for the aerospace manufacturing workforce, particularly those skilled in engine production and maintenance.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award raises concerns about price reasonableness and potential lack of innovation.
- Cost-plus-fixed-fee contract type can lead to cost overruns if not closely monitored.
- Long performance period may indicate a lack of readily available alternative solutions.
- Limited transparency due to sole-source nature makes independent value assessment difficult.
Positive Signals
- Award to a major defense contractor like General Electric suggests access to specialized expertise.
- Contract supports critical defense capabilities, aligning with national security objectives.
- Fixed fee component provides some cost certainty compared to pure cost-plus contracts.
Sector Analysis
This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector, a critical component of the aerospace and defense industry. This sector is characterized by high barriers to entry, significant R&D investment, and stringent quality and performance requirements. General Electric is a dominant player in this market. Comparable spending benchmarks are difficult to establish without knowing the specific engine type and quantity, but large sole-source contracts are not uncommon for specialized defense systems where only a few manufacturers possess the necessary capabilities.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Given the nature of aircraft engine manufacturing, it is likely that General Electric will be the prime contractor, with potential for subcontracting opportunities to specialized small businesses within the aerospace supply chain. However, the primary award is not directly benefiting small businesses through a set-aside.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Navy's contracting and program management offices. Accountability measures would include performance reviews, delivery schedules, and adherence to the cost-plus-fixed-fee agreement. Transparency may be limited due to the sole-source nature, but contract modifications and performance reports are typically available through federal procurement databases. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Aircraft Engine Procurement
- Naval Aviation Readiness
- Defense Industrial Base
- Aerospace Manufacturing Contracts
Risk Flags
- Sole-source award
- Cost-plus-fixed-fee contract type
- Lack of detailed performance metrics
Tags
defense, department-of-defense, department-of-the-navy, aircraft-engine-manufacturing, sole-source, cost-plus-fixed-fee, delivery-order, massachusetts, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $19.8 million to GENERAL ELECTRIC COMPANY. 2025 MPPST, RDT&E
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 $19.8 million.
What is the period of performance?
Start: 2025-01-01. End: 2027-03-30.
What is the specific aircraft platform or program this contract supports?
The provided data does not specify the exact aircraft platform or program for which these aircraft engines and parts are intended. This information is crucial for understanding the strategic importance and operational context of the contract. Knowing the platform would allow for a more precise assessment of the engine's role, its criticality to fleet readiness, and potential alternatives or upgrades. Without this detail, the analysis remains at a general level concerning aircraft engine support for the Department of the Navy.
How does the pricing structure (Cost Plus Fixed Fee) compare to other sole-source engine contracts?
Cost Plus Fixed Fee (CPFF) contracts are common in defense procurement, especially for complex systems where exact costs are difficult to predict upfront. In a CPFF contract, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. Compared to other sole-source engine contracts, CPFF can offer some cost predictability due to the fixed fee, unlike pure cost-plus contracts where profit can escalate with costs. However, it still carries the risk of cost overruns if initial cost estimates are inaccurate or if unforeseen issues arise during performance. Benchmarking requires access to detailed cost breakdowns and profit margins of similar sole-source awards, which are often not publicly available.
What are the key performance indicators (KPIs) and delivery milestones for this contract?
The provided data does not detail the specific Key Performance Indicators (KPIs) or delivery milestones for this contract. Typically, for aircraft engine contracts, KPIs would include engine reliability, performance metrics (e.g., thrust, fuel efficiency), turnaround time for repairs or overhauls, and on-time delivery of parts. Delivery milestones would outline the schedule for engine deliveries, component replacements, or maintenance services. The absence of this information limits the ability to assess the contractor's performance expectations and the government's ability to track progress effectively against defined objectives.
What is General Electric's historical performance and track record with similar sole-source DoD contracts?
General Electric (GE) is a long-standing and major contractor for the Department of Defense, particularly in the aerospace sector. They have a extensive history of supplying engines and related services for various military aircraft platforms. While specific performance data for all past sole-source contracts is not readily available in the public domain, GE is generally recognized for its technical capabilities and significant market share in military engine production. However, like any large contractor, they may have faced performance challenges or cost issues on specific contracts, which would typically be managed through contract administration and oversight processes by the procuring agency.
What is the projected spending trend for aircraft engine and parts manufacturing within the Department of the Navy?
Projected spending trends for aircraft engine and parts manufacturing within the Department of the Navy are influenced by several factors, including fleet modernization plans, operational tempo, and anticipated retirement of older aircraft. While this specific $19.8 million contract represents a snapshot, broader trends can be inferred from defense budget allocations and strategic documents. The Navy consistently invests heavily in aviation, implying a sustained demand for engines and parts to maintain readiness. Factors like the development of new engine technologies or the sustainment of existing platforms will shape future spending patterns. Analyzing historical spending data and future procurement forecasts would provide a clearer picture of these trends.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: ENGINES AND TURBINES AND COMPONENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
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: $20,604,991
Exercised Options: $20,604,991
Current Obligation: $19,844,296
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0042123G0004
IDV Type: BOA
Timeline
Start Date: 2025-01-01
Current End Date: 2027-03-30
Potential End Date: 2027-03-30 00:00:00
Last Modified: 2026-01-12
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