DoD's $25.9M Aircraft Engine Contract with RTX Corporation: A Decade-Long Award
Contract Overview
Contract Amount: $25,894,030 ($25.9M)
Contractor: RTX Corporation
Awarding Agency: Department of Defense
Start Date: 2000-01-27
End Date: 2010-05-31
Contract Duration: 3,777 days
Daily Burn Rate: $6.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Place of Performance
Location: PATUXENT RIVER, ST. MARY'S County, MARYLAND, 20670
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $25.9 million to RTX CORPORATION for work described as: Key points: 1. The contract, awarded to RTX Corporation, represents a significant investment in aircraft engine manufacturing. 2. Full and open competition was utilized, suggesting a potentially competitive bidding process. 3. The contract duration of over 10 years raises questions about long-term value and potential for price escalation. 4. The sector is critical for defense readiness, but the specific award details lack transparency on performance metrics.
Value Assessment
Rating: fair
The contract type is Cost Plus Fixed Fee, which can lead to higher costs compared to fixed-price contracts if not managed carefully. The total award amount of $25.9 million over nearly 10 years suggests a moderate value, but without detailed breakdowns, a precise pricing assessment is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple bidders were likely considered. This method generally promotes price discovery and can lead to more competitive pricing.
Taxpayer Impact: The long duration and cost-plus nature of the contract warrant scrutiny to ensure taxpayer funds are used efficiently and effectively over its lifespan.
Public Impact
Taxpayers may be impacted by the long-term commitment to a single supplier for critical aircraft engine components. The defense sector's reliance on advanced manufacturing like aircraft engines highlights the importance of competitive and cost-effective procurement. The lack of specific performance data or unit cost benchmarks makes it challenging for the public to assess the true value for money.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (over 10 years)
- Cost Plus Fixed Fee contract type
- Lack of specific performance metrics
- No indication of small business participation
Positive Signals
- Awarded under full and open competition
- Established supplier (RTX Corporation)
Sector Analysis
This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector, a high-value and technologically advanced area crucial for national defense. Spending benchmarks in this sector are often high due to R&D and specialized production, making competitive pricing essential.
Small Business Impact
There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. This represents a missed opportunity to foster small business growth within the defense industrial base.
Oversight & Accountability
The long duration of the contract necessitates robust oversight from the Department of Defense to ensure RTX Corporation meets performance requirements and cost controls are maintained. Regular reviews are crucial for accountability.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for cost overruns due to CPFF structure
- Lack of transparency on specific deliverables and performance metrics
- Long contract duration may limit flexibility and future innovation
- No evidence of small business participation
- Limited insight into competitive pricing effectiveness over time
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, md, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.9 million to RTX CORPORATION. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is RTX CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $25.9 million.
What is the period of performance?
Start: 2000-01-27. End: 2010-05-31.
What specific aircraft platforms or engine models does this contract support, and how does the awarded amount compare to the lifecycle costs of these platforms?
The contract supports aircraft engines and parts, likely for various Department of the Navy platforms. Without specific platform details, a direct comparison to lifecycle costs is impossible. However, the $25.9 million over nearly a decade suggests a significant but potentially reasonable investment if it ensures operational readiness and reduces long-term maintenance expenses for critical assets.
Given the Cost Plus Fixed Fee structure and long duration, what mechanisms are in place to mitigate cost overruns and ensure the government receives fair value?
The Cost Plus Fixed Fee structure inherently carries risk of cost overruns. Mitigation likely relies on stringent contract management, detailed audits of incurred costs, and performance incentives tied to the fixed fee. The Department of Defense must actively monitor expenditures and negotiate any necessary adjustments to ensure the fixed fee remains appropriate for the work performed over the contract's extended period.
How does the performance of RTX Corporation on this contract compare to industry benchmarks for aircraft engine manufacturing and maintenance?
Publicly available data does not provide specific performance metrics for this contract against industry benchmarks. While RTX is a major player, the effectiveness of this award hinges on factors like on-time delivery, engine reliability, and adherence to quality standards, which are not detailed here. Further analysis would require access to performance reports and comparative data.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 17900 BEELINE HWY, JUPITER, FL, 21
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2000-01-27
Current End Date: 2010-05-31
Potential End Date: 2010-05-31 00:00:00
Last Modified: 2009-04-27
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