Boeing awarded $57.6M IDIQ for F/A-18 support, raising questions about competition and value
Contract Overview
Contract Amount: $57,628,105 ($57.6M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2018-11-27
End Date: 2023-12-10
Contract Duration: 1,839 days
Daily Burn Rate: $31.3K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: IGF::OT::IGF F/A-18 IDIQ TO GENERAL ENGINEERING
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $57.6 million to THE BOEING COMPANY for work described as: IGF::OT::IGF F/A-18 IDIQ TO GENERAL ENGINEERING Key points: 1. Contract awarded without competition, limiting price discovery and potentially increasing costs. 2. Long performance period (over 5 years) suggests a need for ongoing support, but lacks transparency on specific deliverables. 3. Cost-plus fixed fee contract type can incentivize higher spending if not closely managed. 4. Focus on aircraft manufacturing (NAICS 336411) indicates a specialized, high-value sector. 5. Delivery order under an IDIQ structure implies a framework for future task orders, but details are not provided. 6. Limited public information on performance metrics makes it difficult to assess value for money. 7. Geographic location in Missouri for the prime contractor may have implications for regional economic impact.
Value Assessment
Rating: questionable
Benchmarking the value of this contract is challenging due to the lack of competitive bidding and detailed performance data. The cost-plus fixed fee structure, while common for complex defense contracts, requires rigorous oversight to ensure costs do not escalate unnecessarily. Without comparable sole-source contracts or detailed cost breakdowns, it's difficult to definitively assess if the pricing reflects fair market value. The extended performance period suggests a significant need, but the absence of specific deliverables makes a direct value comparison problematic.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded as a sole-source delivery order under an existing IDIQ, meaning it was not competed at the task order level. This approach bypasses the typical competitive process, which could lead to higher prices and reduced innovation. The lack of multiple bidders means there was no direct price comparison to drive down costs for the government. While sole-source awards can be justified for specialized needs, the absence of competition here warrants scrutiny regarding the necessity and justification for not seeking alternative quotes or bids.
Taxpayer Impact: The lack of competition means taxpayers may not be receiving the best possible price for these F/A-18 support services. Without competitive pressure, there is a risk of overpaying for the goods and services rendered.
Public Impact
The primary beneficiaries are the U.S. Navy and potentially other branches utilizing F/A-18 aircraft, ensuring operational readiness. Services delivered likely include maintenance, repair, overhaul, and technical support for the F/A-18 fleet. Geographic impact is concentrated around the contractor's facilities in Missouri, potentially supporting local jobs and the regional economy. Workforce implications include employment for skilled technicians, engineers, and support staff within the aerospace manufacturing sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition for this delivery order raises concerns about potential overpricing and reduced value for taxpayer dollars.
- The cost-plus fixed fee contract type necessitates robust oversight to prevent cost overruns and ensure efficient resource utilization.
- Limited transparency regarding specific performance metrics and deliverables makes it difficult to assess the effectiveness and efficiency of the services provided.
- The extended duration of the contract without clear milestones could indicate a lack of defined objectives or potential for scope creep.
Positive Signals
- The contract supports critical defense assets (F/A-18 aircraft), contributing to national security and military readiness.
- The awardee, The Boeing Company, is a major defense contractor with established expertise in aircraft manufacturing and support.
- The IDIQ structure provides a flexible framework for addressing ongoing support needs for the F/A-18 fleet.
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft support. The NAICS code 336411 (Aircraft Manufacturing) indicates a highly specialized industry characterized by high barriers to entry, significant R&D investment, and long product lifecycles. Spending in this sector is heavily influenced by government defense budgets and strategic priorities. Comparable spending benchmarks would typically involve other large-scale sustainment contracts for major weapon systems, often awarded to a limited number of prime contractors due to the complexity and security requirements.
Small Business Impact
This contract does not appear to have a small business set-aside component, nor is there explicit information regarding subcontracting opportunities for small businesses. Given the nature of the work (aircraft manufacturing and support) and the prime contractor's size, it is possible that larger subcontractors may be involved. Further analysis would be needed to determine if small businesses are being utilized in the supply chain or for specific support functions, and whether subcontracting goals are being met.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Inspector General's office for the Department of Defense would have jurisdiction for audits and investigations into potential fraud, waste, or abuse. Transparency is limited by the sole-source nature of the award and the lack of publicly available detailed performance reports. Accountability relies on the government's ability to monitor costs, schedule, and performance against the contract's terms and conditions.
Related Government Programs
- F/A-18 Super Hornet Program
- Naval Aviation Maintenance Programs
- Defense Contract Management Agency (DCMA) Oversight
- Aerospace Manufacturing and Repair Services
Risk Flags
- Sole-source award lacks competitive pricing.
- Cost-plus contract type requires robust oversight.
- Limited transparency on performance metrics.
- Extended contract duration without clear milestones.
Tags
defense, department-of-defense, navy, aircraft-manufacturing, f-18, support-services, sole-source, cost-plus-fixed-fee, missouri, large-contractor, defense-contracting, aerospace
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $57.6 million to THE BOEING COMPANY. IGF::OT::IGF F/A-18 IDIQ TO GENERAL ENGINEERING
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 $57.6 million.
What is the period of performance?
Start: 2018-11-27. End: 2023-12-10.
What is the historical spending pattern for F/A-18 support services awarded to The Boeing Company?
Analyzing historical spending for F/A-18 support services awarded to The Boeing Company requires access to comprehensive contract databases and procurement records. Generally, sustainment contracts for major weapon systems like the F/A-18 are long-term and involve significant annual expenditures. These costs can fluctuate based on operational tempo, fleet readiness requirements, and the specific services being procured (e.g., depot maintenance, component repair, engineering support). Without specific data on prior contracts, it's difficult to provide precise figures, but it's reasonable to assume consistent, substantial investment over the F/A-18's lifecycle. The current $57.6 million award represents a portion of this ongoing investment, and its value should be assessed in the context of the overall sustainment budget for the F/A-18 fleet.
How does the cost-plus fixed fee (CPFF) structure compare to other contract types for similar defense sustainment services?
The Cost-Plus Fixed Fee (CPFF) contract type is often used for complex research, development, or specialized services where the scope of work is not precisely defined at the outset, or where costs are difficult to estimate accurately. In defense sustainment, CPFF can be advantageous when unforeseen technical challenges or repair needs arise, allowing the contractor to be reimbursed for allowable costs plus a predetermined fixed fee. However, it carries a higher risk of cost overruns compared to fixed-price contracts, as the government bears the risk of cost increases. Other common contract types include Firm-Fixed-Price (FFP), which offers better cost certainty for the government but less flexibility for the contractor, and Cost-Plus-Incentive Fee (CPIF), which incentivizes both parties to control costs. The choice of CPFF for this F/A-18 support contract suggests a need for flexibility, but necessitates stringent oversight to manage costs effectively.
What are the specific performance metrics and deliverables associated with this $57.6 million award?
The provided data does not specify the exact performance metrics or deliverables associated with this $57.6 million IDIQ delivery order for F/A-18 support. Typically, such contracts would outline key performance indicators (KPIs) related to aircraft availability, turnaround times for repairs, quality of maintenance, and adherence to technical specifications. Deliverables might include completed maintenance actions, engineering reports, spare parts provisioning, or technical data updates. The absence of this detail in the summary data makes it challenging to independently assess the contractor's performance and the overall value derived from the contract. A thorough review of the contract's statement of work (SOW) would be necessary to ascertain these specifics.
What is the justification for awarding this contract on a sole-source basis rather than through full and open competition?
The justification for awarding this contract on a sole-source basis is not detailed in the provided data. However, sole-source awards in defense contracting are typically justified under specific circumstances outlined in federal acquisition regulations (FAR). These can include situations where only one responsible source can provide the required supplies or services, there is a compelling urgency, or the award is made pursuant to a treaty or international agreement. For aircraft support, justifications might stem from unique technical expertise, proprietary data, or the need to maintain commonality within a specific fleet. Without the official justification document (e.g., a Justification and Approval - J&A), it is difficult to validate the necessity of bypassing full and open competition.
What is the track record of The Boeing Company in delivering F/A-18 support services, and have there been past performance issues?
The Boeing Company has a long-standing and extensive track record in manufacturing and supporting the F/A-18 aircraft family for the U.S. Navy and international customers. As the original equipment manufacturer (OEM), they possess deep institutional knowledge and technical expertise. While specific past performance issues related to this particular contract or recent F/A-18 support efforts are not detailed in the provided data, large defense contractors can face scrutiny over cost, schedule, and quality on various programs. Government contract performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) are typically used to document past performance. A comprehensive review would involve examining these records for Boeing's performance on similar defense sustainment contracts to identify any recurring concerns or commendations.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N6893615R0072
Pricing Type: COST PLUS FIXED FEE (U)
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: $71,554,621
Exercised Options: $71,554,621
Current Obligation: $57,628,105
Actual Outlays: $8,256,390
Subaward Activity
Number of Subawards: 30
Total Subaward Amount: $5,608,000
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: N6893618D0026
IDV Type: IDC
Timeline
Start Date: 2018-11-27
Current End Date: 2023-12-10
Potential End Date: 2023-12-10 00:00:00
Last Modified: 2024-01-08
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