DoD Awards $19.8M for MT 30 Engines to Rolls-Royce Corporation, No Competition Identified

Contract Overview

Contract Amount: $19,799,198 ($19.8M)

Contractor: Rolls-Royce Corporation

Awarding Agency: Department of Defense

Start Date: 2023-05-01

End Date: 2025-10-24

Contract Duration: 907 days

Daily Burn Rate: $21.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MT 30 ENGINE

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46225

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $19.8 million to ROLLS-ROYCE CORPORATION for work described as: MT 30 ENGINE Key points: 1. Significant award to a single, established contractor for specialized engines. 2. Lack of competition raises questions about price discovery and potential overspending. 3. The contract duration extends over two years, indicating a substantial commitment. 4. The sector is Defense, specifically related to shipbuilding and repair.

Value Assessment

Rating: questionable

The contract value of $19.8 million for 907 days of duration is difficult to benchmark without specific per-unit cost data. However, the absence of competition suggests potential for inflated pricing compared to a competitive environment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source or limited competition award. This method bypasses competitive bidding, potentially leading to higher prices and reduced value for taxpayer money.

Taxpayer Impact: The lack of competition means taxpayers may be paying a premium for these engines, as there was no market pressure to drive down costs.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. The long contract duration suggests a critical need for these specific engines. Potential for follow-on contracts without competition could continue to impact costs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for price inflation
Long contract duration

Positive Signals

Award to established contractor
Specific need identified

Sector Analysis

The Department of Defense frequently procures complex machinery and components for naval vessels. Rolls-Royce is a known entity in engine manufacturing, suggesting this award is for specialized, potentially proprietary, technology. Benchmarks for similar specialized engine contracts are often difficult to ascertain due to unique specifications.

Small Business Impact

This contract was awarded to Rolls-Royce Corporation, a large business. There is no indication that small businesses were involved in this specific procurement, either as prime contractors or subcontractors.

Oversight & Accountability

The 'NOT COMPETED' status warrants further oversight to ensure the justification for sole-source procurement was robust and that the pricing is fair and reasonable. Agency oversight from the Defense Contract Management Agency is noted.

Related Government Programs

Ship Building and Repairing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source award
Potential for price inflation
Lack of transparency in pricing
Limited opportunity for small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.8 million to ROLLS-ROYCE CORPORATION. MT 30 ENGINE

Who is the contractor on this award?

The obligated recipient is ROLLS-ROYCE CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $19.8 million.

What is the period of performance?

Start: 2023-05-01. End: 2025-10-24.

What is the specific justification for awarding this contract on a sole-source basis, and was a market survey conducted to confirm the lack of viable alternatives?

The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. A thorough market survey should have been conducted to validate that no other capable sources exist or could be developed within the required timeframe. Without this information, it's difficult to assess if the government truly exhausted all competitive options.

How does the per-unit cost of these MT 30 engines compare to industry benchmarks or previous procurements, if available, given the lack of competition?

Benchmarking the per-unit cost is challenging without competitive data. If previous procurements exist, comparing those prices, adjusted for inflation and any specification changes, would be a starting point. However, the absence of current competition means the government lacks the leverage to negotiate the best possible price. Independent cost analysis or review of Rolls-Royce's cost proposals would be crucial for validation.

What is the long-term strategy for ensuring competitive sourcing for future engine needs, particularly if the MT 30 remains a critical component?

The long-term strategy should focus on fostering competition where feasible. This could involve encouraging new entrants into the market, exploring alternative engine technologies, or breaking down future procurements into smaller lots to allow for broader participation. If the MT 30 is indeed unique and essential, the government might consider investing in research and development to create alternative sources or technologies to mitigate future sole-source risks.

Industry Classification

NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing

Product/Service Code: ENGINES AND TURBINES AND COMPONENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rolls-Royce Holdings PLC

Address: 450 S. MERIDIAN ST, INDIANAPOLIS, IN, 46225

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $19,799,198

Exercised Options: $19,799,198

Current Obligation: $19,799,198

Subaward Activity

Number of Subawards: 28

Total Subaward Amount: $12,913,574

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002419G4108

IDV Type: BOA

Timeline