Boeing awarded $19.17M contract for maintenance training capability upgrade by the Department of the Navy

Contract Overview

Contract Amount: $19,165,293 ($19.2M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2022-04-20

End Date: 2025-02-28

Contract Duration: 1,045 days

Daily Burn Rate: $18.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: MAINTENACE TRAINING CAPABILITY UPGRADE

Place of Performance

Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $19.2 million to THE BOEING COMPANY for work described as: MAINTENACE TRAINING CAPABILITY UPGRADE Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns if not managed carefully. 2. The contract was not competed, raising questions about potential price efficiencies and best value. 3. A long performance period of 1045 days suggests a complex and potentially high-risk undertaking. 4. The specific Product Service Code (PSC) is not provided, making direct benchmarking difficult. 5. The contract is a delivery order under a larger contract, indicating a phased approach to procurement.

Value Assessment

Rating: questionable

Benchmarking the value of this $19.17 million contract is challenging without a specific Product Service Code (PSC) or detailed scope of work. The cost-plus-fixed-fee (CPFF) pricing structure inherently carries more risk for the government compared to fixed-price contracts, as contractor profit is guaranteed and costs can escalate. Without competitive bids, it's difficult to assess if the pricing reflects fair market value or if potential savings were forgone.

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 among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities or when urgency dictates. The lack of competition limits the government's ability to leverage market forces to achieve the best possible price and terms.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings that typically arise from a competitive bidding process.

Public Impact

The Department of the Navy benefits from an upgraded maintenance training capability, potentially improving readiness and operational efficiency. Personnel within the Navy's maintenance divisions will likely receive enhanced training, leading to improved skill sets. The contract's impact is primarily within the defense sector, specifically for naval aviation or other maintenance operations. The workforce implications are centered on the training personnel and potentially the contractors involved in developing and delivering the training.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus-fixed-fee contracts can incentivize cost overruns if not closely monitored.
The long duration of the contract increases the risk of scope creep or changing requirements.
Limited transparency due to sole-source award hinders public scrutiny of value for money.

Positive Signals

Addresses a critical need for maintenance training capability upgrades within the Department of the Navy.
The Boeing Company has a significant track record in defense contracting, suggesting potential for successful delivery.
The contract is a delivery order, implying it's part of a larger, potentially established framework, which can streamline execution.

Sector Analysis

The defense sector, particularly within aerospace and training systems, is characterized by long-term, high-value contracts. Companies like The Boeing Company are major players, often holding significant portions of the market for specialized training and maintenance solutions. This contract fits within the broader trend of defense agencies investing in advanced training technologies to maintain readiness and adapt to evolving operational demands. Benchmarking against similar training system upgrades in the defense sector would require access to detailed specifications and pricing structures, which are often proprietary.

Small Business Impact

There is no indication that this contract includes a small business set-aside. Given the sole-source nature and the prime contractor being The Boeing Company, it is unlikely that small businesses will be directly involved as set-aside awardees. However, Boeing may engage small businesses as subcontractors, but the extent and impact on the small business ecosystem are not detailed in the provided data.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. As a cost-plus-fixed-fee contract, rigorous financial oversight and auditing are crucial to ensure costs are reasonable and allocable. Transparency is limited due to the sole-source award, but contract performance reviews and milestone tracking would be standard accountability measures. The Inspector General for the Department of Defense would have jurisdiction for audits and investigations.

Related Government Programs

Naval Aviation Training Systems
Defense Training Simulators
Maintenance Support Services
Aerospace Training Technology

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.2 million to THE BOEING COMPANY. MAINTENACE TRAINING CAPABILITY UPGRADE

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 $19.2 million.

What is the period of performance?

Start: 2022-04-20. End: 2025-02-28.

What is The Boeing Company's track record with similar maintenance training capability upgrade contracts for the Department of Defense?

The Boeing Company has a substantial history of delivering complex training systems and capability upgrades for various branches of the U.S. military, including the Department of Defense. Their portfolio includes flight simulators, maintenance trainers, and virtual reality training environments for platforms ranging from aircraft to naval vessels. While specific contract details for similar maintenance training upgrades are often proprietary, Boeing's consistent presence as a prime contractor in this space suggests a recognized capability. However, performance can vary, and past performance reviews, often available through government contracting databases like the Federal Procurement Data System (FPDS), would provide a more granular assessment of their success rates, on-time delivery, and adherence to budget on comparable projects.

How does the $19.17 million cost compare to similar maintenance training capability upgrades in the defense sector?

Directly comparing the $19.17 million cost is difficult without knowing the specific scope, technology involved, and duration of the training capability upgrade. Defense training systems can range from basic procedural trainers to highly sophisticated virtual reality simulators. Contracts for such systems can vary significantly in price, from a few million dollars for simpler upgrades to hundreds of millions for entirely new platform simulators. The cost-plus-fixed-fee (CPFF) nature of this contract also introduces variability, as the final cost is not fixed upfront. To make a meaningful comparison, one would need to identify contracts with similar technological complexity, number of training modules, and user base within the Department of Defense or other military branches.

What are the primary risks associated with a sole-source, cost-plus-fixed-fee contract for a training capability upgrade?

The primary risks associated with a sole-source, cost-plus-fixed-fee (CPFF) contract for a training capability upgrade are multifaceted. From a cost perspective, the lack of competition means the government may not achieve the most favorable pricing, potentially paying a premium. The CPFF structure, while providing flexibility, can incentivize contractors to incur higher costs, as their fee is a percentage of those costs, increasing the risk of budget overruns if not meticulously managed and audited. Programmatically, sole-source awards can limit the pool of innovative solutions available, potentially leading to a less optimal or outdated training system. Furthermore, the extended performance period (1045 days) increases the risk of scope creep, requirement changes, and contractor performance issues over time, all of which are harder to mitigate without competitive pressure.

What is the expected effectiveness or impact of this maintenance training capability upgrade on Navy readiness?

The expected effectiveness of this maintenance training capability upgrade on Navy readiness hinges on the specific improvements it brings to the skills and knowledge of maintenance personnel. If the upgrade provides more realistic simulations, covers a wider range of maintenance scenarios, or incorporates advanced diagnostic tools, it could lead to faster, more accurate repairs and reduced downtime for naval assets. Enhanced training can also improve safety protocols and reduce errors. The ultimate impact on readiness will be measured by metrics such as reduced maintenance turnaround times, increased operational availability of equipment, and a more proficient and confident maintenance workforce. The success of the upgrade is contingent on its alignment with current and future maintenance needs and the quality of its implementation and utilization.

How has historical spending on maintenance training capabilities by the Department of the Navy trended in recent years?

Historical spending on maintenance training capabilities by the Department of the Navy has generally trended upwards, reflecting a continuous need to modernize training infrastructure and adapt to evolving platforms and technologies. Factors driving this trend include the introduction of new weapon systems, the increasing complexity of existing systems, and the desire for more cost-effective and efficient training methods, such as simulation and virtual reality. While specific figures for 'maintenance training capability upgrades' can be difficult to isolate from broader training and simulation budgets, the Navy consistently allocates significant resources to ensure its personnel are proficient in maintaining critical assets. Analyzing trends would involve examining annual budget requests, contract awards data for training systems, and strategic documents outlining modernization priorities.

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: N6134018R0002

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 6200 JAMES S 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: $19,165,293

Exercised Options: $19,165,293

Current Obligation: $19,165,293

Subaward Activity

Number of Subawards: 13

Total Subaward Amount: $1,712,205

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6134019D0906

IDV Type: IDC

Timeline