DoD Awards $189M to Boeing for P-8A Training Systems Hardware, Lacking Competition
Contract Overview
Contract Amount: $188,900,000 ($188.9M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2022-01-31
End Date: 2028-10-13
Contract Duration: 2,447 days
Daily Burn Rate: $77.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: P-8A SOUTH KOREA TRAINING SYSTEMS PHASE 1 HARDWARE
Place of Performance
Location: ORLANDO, ORANGE County, FLORIDA, 32826
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $188.9 million to THE BOEING COMPANY for work described as: P-8A SOUTH KOREA TRAINING SYSTEMS PHASE 1 HARDWARE Key points: 1. Significant investment in advanced training systems for the P-8A Poseidon aircraft. 2. Sole reliance on Boeing raises concerns about potential cost inefficiencies and limited innovation. 3. High contract value indicates critical need but also substantial taxpayer exposure. 4. Sector focus on defense training technology, a specialized and high-cost area.
Value Assessment
Rating: questionable
The contract value of $188.9 million for P-8A training systems hardware is substantial. Without competitive bidding, it's difficult to benchmark pricing against similar systems or assess if the firm fixed price represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, The Boeing Company, was considered. This lack of competition limits price discovery and may lead to higher costs than if multiple vendors had competed.
Taxpayer Impact: The absence of competition increases the risk of overpaying, potentially costing taxpayers more than necessary for these critical training systems.
Public Impact
Enhances pilot and crew readiness for the P-8A maritime patrol aircraft. Supports critical defense capabilities for the U.S. Navy and potentially allied nations. Invests in advanced simulation and training technology, crucial for complex aircraft operations. Potential for long-term sustainment and upgrade contracts with the same vendor.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price negotiation.
- Long contract duration (over 4 years) increases risk of cost overruns.
- Lack of small business participation noted.
Positive Signals
- Addresses a critical need for advanced training systems.
- Firm fixed price contract provides some cost certainty.
- Awarded to a known, experienced defense contractor.
Sector Analysis
This contract falls within the defense sector, specifically focusing on specialized training and simulation equipment for advanced aircraft like the P-8A. Spending in this niche can be high due to technological complexity and limited market players.
Small Business Impact
The data indicates no specific set-aside for small businesses in this sole-source award. This suggests that opportunities for small businesses to participate in this specific contract are likely limited, potentially through subcontracting if Boeing chooses.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure Boeing is delivering value and managing costs effectively. Accountability will be key in monitoring performance and expenditures throughout the contract's life.
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
- High contract value
- Long contract duration
- No small business set-aside
Tags
other-commercial-and-service-industry-ma, department-of-defense, fl, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $188.9 million to THE BOEING COMPANY. P-8A SOUTH KOREA TRAINING SYSTEMS PHASE 1 HARDWARE
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 $188.9 million.
What is the period of performance?
Start: 2022-01-31. End: 2028-10-13.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without further details, it's unclear if other companies could have met the requirements or if a competitive process was genuinely explored. Understanding this is crucial for assessing the necessity of bypassing competition and its potential impact on cost.
How does the cost of this training system compare to similar systems procured competitively?
Benchmarking this $188.9 million contract against similar P-8A training systems or comparable aircraft training solutions procured through competitive means is essential. A lack of competitive data makes it difficult to determine if the price is reasonable. Further analysis would require access to cost data from other, potentially competitive, training system procurements.
What mechanisms are in place to ensure effective performance and prevent cost overruns during the contract's duration?
Given the long duration and sole-source nature, robust performance monitoring and cost control mechanisms are vital. This includes clear performance metrics, regular progress reviews, and potentially independent cost audits. Ensuring accountability for meeting delivery schedules and technical specifications without exceeding the firm fixed price is paramount for taxpayer protection.
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: N6134019R0009
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JS 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: $188,900,000
Exercised Options: $188,900,000
Current Obligation: $188,900,000
Subaward Activity
Number of Subawards: 65
Total Subaward Amount: $24,509,062
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: N6134019G0002
IDV Type: BOA
Timeline
Start Date: 2022-01-31
Current End Date: 2028-10-13
Potential End Date: 2028-10-13 00:00:00
Last Modified: 2025-04-02
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