Vertex Aerospace LLC contract for aircraft maintenance and logistics support valued at $59.3M shows fair value with limited competition

Contract Overview

Contract Amount: $59,288,195 ($59.3M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2018-08-18

End Date: 2022-04-30

Contract Duration: 1,351 days

Daily Burn Rate: $43.9K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST NO FEE

Sector: Defense

Official Description: IGF::CT::IGF T-45 U.S.N. AIRCRAFT MAINTENANCE AND LOGISTICS SUPPORT (CLS)

Place of Performance

Location: MADISON, MADISON County, MISSISSIPPI, 39110

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $59.3 million to VERTEX AEROSPACE LLC for work described as: IGF::CT::IGF T-45 U.S.N. AIRCRAFT MAINTENANCE AND LOGISTICS SUPPORT (CLS) Key points: 1. The contract demonstrates a reasonable value for the services provided, aligning with benchmarks for similar support activities. 2. Competition was limited, potentially impacting price discovery and overall cost-effectiveness for taxpayers. 3. Risk indicators appear manageable, with no significant red flags identified in performance or financial stability. 4. The contract's performance context is within the broader scope of U.S. Navy aircraft maintenance and logistics. 5. Positioned within the Defense sector, this contract supports critical operational readiness for air assets.

Value Assessment

Rating: fair

The contract's value of $59.3 million appears fair when benchmarked against similar aircraft maintenance and logistics support contracts. While specific per-unit cost data is not readily available for direct comparison, the overall award amount seems proportionate to the duration and scope of services. The pricing structure (Cost No Fee) suggests a focus on ensuring service delivery, though it necessitates robust oversight to manage costs effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. However, the specific number of bidders is not detailed, which makes it difficult to fully assess the intensity of the competition. Limited competition could potentially lead to higher prices than a more robust bidding process might achieve.

Taxpayer Impact: While full and open competition is generally beneficial for taxpayers, the lack of detailed bidder information prevents a definitive assessment of whether the most competitive pricing was secured.

Public Impact

The U.S. Navy benefits from enhanced aircraft maintenance and logistics, ensuring operational readiness. Services delivered include critical support activities for air transportation, maintaining fleet availability. The contract's geographic impact is primarily tied to the operational bases of the U.S. Navy's air assets. Workforce implications include employment opportunities for skilled technicians and support personnel in aviation maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to Cost No Fee pricing structure without detailed cost breakdowns.
Limited competition may have resulted in a less optimal price for taxpayers.
Dependence on a single contractor for critical support functions could pose a risk if performance falters.

Positive Signals

Contract awarded through full and open competition, allowing for broad market participation.
Vertex Aerospace LLC's role in providing essential maintenance supports U.S. Navy operational readiness.
The contract duration of over three years suggests a stable and reliable support mechanism.

Sector Analysis

This contract falls within the broader aerospace and defense sector, specifically supporting aviation maintenance and logistics. The market for such services is substantial, driven by the significant investments governments make in military aviation. Comparable spending benchmarks in this area often relate to the total cost of ownership for aircraft fleets, where maintenance and support constitute a significant portion. This contract represents a portion of that overall spending, focused on ensuring the operational capability of specific aircraft.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically mandated for small businesses through this award. The primary contractor, Vertex Aerospace LLC, will likely manage its own supply chain and support needs, with potential for small business engagement occurring at their discretion rather than through a set-aside requirement.

Oversight & Accountability

Oversight for this contract is managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures are inherent in the contract terms, including performance standards and delivery schedules. Transparency is facilitated through contract award databases, though detailed operational performance metrics may not be publicly disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance Services
Logistics Support Services
Defense Contract Management
U.S. Navy Aviation Programs
Aerospace Support Contracts

Risk Flags

Limited competition may impact price optimization.
Cost No Fee pricing requires diligent oversight to control costs.
Dependence on contractor performance for critical operational support.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $59.3 million to VERTEX AEROSPACE LLC. IGF::CT::IGF T-45 U.S.N. AIRCRAFT MAINTENANCE AND LOGISTICS SUPPORT (CLS)

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $59.3 million.

What is the period of performance?

Start: 2018-08-18. End: 2022-04-30.

What is Vertex Aerospace LLC's track record with similar government contracts, particularly in aircraft maintenance and logistics?

Vertex Aerospace LLC has a history of performing contracts related to aircraft maintenance, modification, and logistics support for various government agencies, including the Department of Defense. Their experience often involves complex aviation systems, requiring skilled personnel and adherence to stringent quality and safety standards. While specific performance ratings for past contracts are not detailed here, their continued engagement in this sector suggests a capacity to meet government requirements. Further analysis would involve reviewing past performance evaluations and any documented issues or commendations on federal procurement databases to fully assess their track record.

How does the $59.3 million contract value compare to the average cost of similar aircraft maintenance and logistics support contracts over a similar duration?

Benchmarking the $59.3 million contract value requires comparing it to contracts of similar scope, duration (approximately 3.7 years), and service type (maintenance and logistics for U.S. Navy aircraft). Without access to a comprehensive database of comparable contracts with detailed cost breakdowns, a precise comparison is challenging. However, for large-scale military aircraft support, this value appears within a reasonable range, considering the complexity and criticality of maintaining naval aviation assets. Factors like the specific aircraft types supported, the level of service required (e.g., depot-level maintenance vs. line maintenance), and geographic locations can significantly influence costs. The Cost No Fee (CNF) pricing structure also implies that the government is bearing the cost of performance, making oversight crucial.

What are the primary risk indicators associated with this contract, and how are they being managed?

Key risk indicators for this contract include the potential for cost overruns inherent in the Cost No Fee (CNF) pricing structure, where the contractor is reimbursed for actual costs plus a fixed fee, but the fee is not adjusted for cost increases. This necessitates robust government oversight to ensure costs remain reasonable and necessary. Another risk is the potential impact of limited competition on price discovery, which could lead to less favorable pricing for the government. Contractor performance risk is also present, as any degradation in maintenance quality or timeliness could impact U.S. Navy operational readiness. Management of these risks would typically involve detailed contract surveillance by the Defense Contract Management Agency (DCMA), regular performance reviews, and potentially incentive structures or penalties tied to performance metrics.

How effective is the competition level (full and open) in ensuring value for money for this specific contract?

The contract was awarded under 'full and open competition,' which theoretically maximizes the potential for value for money by allowing all eligible sources to compete. However, the effectiveness of this competition in securing optimal value is contingent on the number of actual bidders and the intensity of their proposals. If only a few bidders participated, or if the bidding process lacked robust evaluation criteria, the competitive pressure might be insufficient to drive down prices to the lowest feasible level. Without specific data on the number of bidders and their proposals, it's difficult to definitively state how effective the competition was in this instance. The 'fair' value assessment suggests that while competition was present, it may not have yielded the absolute best possible price.

What are the historical spending patterns for aircraft maintenance and logistics support within the Department of Defense, and how does this contract fit?

Historical spending on aircraft maintenance and logistics support within the Department of Defense represents a substantial and consistent portion of the overall defense budget, often running into billions of dollars annually. These expenditures are critical for maintaining the readiness and operational capability of the U.S. military's vast fleet of aircraft. This specific $59.3 million contract fits within this broader spending pattern as one of many individual awards designed to ensure the upkeep of specific aircraft types or support functions. It contributes to the overall goal of fleet availability and mission readiness, reflecting the ongoing investment required to sustain complex military aviation assets over their lifecycle.

What are the implications of the 'Other Support Activities for Air Transportation' (NAICS 488190) classification for this contract?

The NAICS code 488190, 'Other Support Activities for Air Transportation,' indicates that the contract covers a range of services beyond basic aircraft repair. This can include activities such as aircraft cleaning, de-icing, ground support, cargo handling, and other essential services that facilitate air operations but may not be directly related to engine or airframe repair. For this contract with Vertex Aerospace LLC, it suggests a comprehensive support role for U.S. Navy aircraft, encompassing logistical and operational readiness functions. This broad classification implies a need for diverse capabilities from the contractor and potentially a wider scope of oversight to ensure all aspects of support are adequately addressed.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0001912R0001

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 555 INDUSTRIAL DR S, MADISON, MS, 39110

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $59,288,195

Exercised Options: $59,288,195

Current Obligation: $59,288,195

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $83,845

Contract Characteristics

Consolidated Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001914D0011

IDV Type: IDC

Timeline