Navy Awards $21.7M for F/A-18 C/D Upgrade to CAE USA Inc., Lacking Competition
Contract Overview
Contract Amount: $21,684,329 ($21.7M)
Contractor: CAE USA Inc.
Awarding Agency: Department of Defense
Start Date: 2019-09-06
End Date: 2023-12-15
Contract Duration: 1,561 days
Daily Burn Rate: $13.9K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: F/A-18 C/D - PROVIDE SIMUSTRIKES, HIGH DEFINITION 9 (HD9) VISUAL SYSTEM, STORAGE AREA NETWORK, BRIEF/DEBRIEF STATION/MISSION OPERATIONS CENTER (BDS/MOC) WITH VIDEO WALL, SPARES, OBOGS UPGRADE, AND WINDOWS 10 UPGRADES.
Place of Performance
Location: ARLINGTON, TARRANT County, TEXAS, 76011
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $21.7 million to CAE USA INC. for work described as: F/A-18 C/D - PROVIDE SIMUSTRIKES, HIGH DEFINITION 9 (HD9) VISUAL SYSTEM, STORAGE AREA NETWORK, BRIEF/DEBRIEF STATION/MISSION OPERATIONS CENTER (BDS/MOC) WITH VIDEO WALL, SPARES, OBOGS UPGRADE, AND WINDOWS 10 UPGRADES. Key points: 1. Significant contract value for specialized aircraft upgrades. 2. Sole-source award to CAE USA Inc. raises competition concerns. 3. Focus on avionics, visual systems, and operational readiness. 4. Potential for cost overruns due to limited price discovery.
Value Assessment
Rating: fair
The contract value of $21.7 million for F/A-18 C/D upgrades appears reasonable given the specialized nature of the systems. However, without competitive bidding, it's difficult to ascertain if this represents the best possible price.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning there was no competition. This limits price discovery and may result in higher costs for taxpayers compared to a competed procurement.
Taxpayer Impact: The lack of competition for this significant contract value means taxpayers may not be receiving the best possible price for these critical F/A-18 upgrades.
Public Impact
Enhances F/A-18 C/D capabilities for naval aviation missions. Supports pilot training and mission planning with advanced visual systems. Addresses critical system upgrades including OBOGS and Windows 10. Ensures continued operational readiness of a key naval asset.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Potential for cost escalation without competitive pressure.
- Contract duration extends over several years.
Positive Signals
- Addresses critical system upgrades for naval aviation.
- Includes essential spares and maintenance components.
- Focus on enhancing mission effectiveness and readiness.
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on aircraft modernization. Spending benchmarks for such specialized upgrades can vary widely based on system complexity and technology insertion.
Small Business Impact
The awardee, CAE USA Inc., is a large business. There is no indication in the provided data that small businesses were involved in this specific sole-source contract.
Oversight & Accountability
The Department of the Navy is responsible for oversight of this contract. The sole-source nature warrants close monitoring to ensure fair pricing and effective delivery of contracted services.
Related Government Programs
- Other Commercial and Service Industry Machinery Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
- Long contract duration
Tags
other-commercial-and-service-industry-ma, department-of-defense, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $21.7 million to CAE USA INC.. F/A-18 C/D - PROVIDE SIMUSTRIKES, HIGH DEFINITION 9 (HD9) VISUAL SYSTEM, STORAGE AREA NETWORK, BRIEF/DEBRIEF STATION/MISSION OPERATIONS CENTER (BDS/MOC) WITH VIDEO WALL, SPARES, OBOGS UPGRADE, AND WINDOWS 10 UPGRADES.
Who is the contractor on this award?
The obligated recipient is CAE USA 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 $21.7 million.
What is the period of performance?
Start: 2019-09-06. End: 2023-12-15.
What is the justification for awarding this contract on a sole-source basis?
The provided data does not specify the justification for the sole-source award. Typically, sole-source procurements are used when only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. Further investigation into the contract file would be required to determine the specific rationale.
What is the potential risk associated with the lack of competition for these F/A-18 upgrades?
The primary risk of a sole-source award is the potential for inflated pricing due to the absence of competitive pressure. Without competing offers, the government may pay more than necessary. Additionally, it could limit innovation and the adoption of potentially more cost-effective solutions that might emerge in a competitive environment.
How will the implemented upgrades impact the overall effectiveness and readiness of the F/A-18 C/D fleet?
The upgrades, including the SimuStrikes, HD9 visual system, and OBOGS, are designed to enhance pilot training realism, improve situational awareness, and ensure critical system reliability. These improvements are expected to directly contribute to the overall effectiveness and readiness of the F/A-18 C/D fleet by providing more advanced training tools and maintaining the aircraft's operational capabilities.
Industry Classification
NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing
Product/Service Code: TRAINING AIDS AND DEVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N6134018R0006
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: CAE Inc
Address: 2200 ARLINGTON DOWNS RD, ARLINGTON, TX, 76011
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: $22,447,490
Exercised Options: $21,684,329
Current Obligation: $21,684,329
Actual Outlays: $947,978
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N6134018D0004
IDV Type: IDC
Timeline
Start Date: 2019-09-06
Current End Date: 2023-12-15
Potential End Date: 2023-12-15 00:00:00
Last Modified: 2025-08-28
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