Boeing Aerospace Operations awarded $194M for aircraft support, with a 5-year duration

Contract Overview

Contract Amount: $33,293,407 ($33.3M)

Contractor: Boeing Aerospace Operations, Inc.

Awarding Agency: Department of Defense

Start Date: 2003-10-22

End Date: 2008-09-30

Contract Duration: 1,805 days

Daily Burn Rate: $18.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200405!000098!5700!GD90 !OC-ALC/LKD (CLS AIRCRAFT) !F0960301D0213 !A!N! !N!SD08 ! !20031022!20040930!194293544!085188316!009256819!N!BOEING AEROSPACE OPERATIONS, I!2601 LIBERTY PKWY !MIDWEST CITY !OK!73110!48350!109!40!MIDWEST CITY !OKLAHOMA !OKLAHOMA !+000003481289!N!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !000 !* !336413!E! !5!B!M! !A! !99990909!B! ! !A! !A!N!J!2!002!B! !A!N!Z! ! !N!C!N! ! ! !Z!Z!A!A!000!A!C!N! ! ! !Y! ! !0001! !

Place of Performance

Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73135, UNITED STATES OF AMERICA

State: Oklahoma Government Spending

Plain-Language Summary

Department of Defense obligated $33.3 million to BOEING AEROSPACE OPERATIONS, INC. for work described as: 200405!000098!5700!GD90 !OC-ALC/LKD (CLS AIRCRAFT) !F0960301D0213 !A!N! !N!SD08 ! !20031022!20040930!194293544!085188316!009256819!N!BOEING AEROSPACE OPERATIONS, I!2601 LIBERTY PKWY !MIDWEST CITY !OK!73110!48350!109!40!MIDWEST CITY !OKLA… Key points: 1. Contract value of $194M over 5 years suggests a significant investment in aircraft sustainment. 2. The contract was awarded under full and open competition, indicating a competitive bidding process. 3. The duration of 1805 days (approx. 5 years) allows for long-term planning and sustained support. 4. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 5. The primary service involves aircraft fixed-wing support, crucial for maintaining operational readiness. 6. The contractor, Boeing Aerospace Operations, Inc., has a substantial presence in Oklahoma. 7. The contract falls under the broader category of Aircraft Manufacturing and Airframes and Spares. 8. The award was made by the Department of the Air Force, a major defense spender.

Value Assessment

Rating: good

The contract value of $194M over approximately five years for aircraft support appears reasonable given the scope of sustaining complex aerospace assets. Benchmarking against similar long-term sustainment contracts for major aircraft platforms would provide a more precise value-for-money assessment. The Firm Fixed Price (FFP) structure is generally favorable for the government when the scope is well-defined, as it caps the contractor's potential profit and transfers cost overrun risk.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition,' suggesting that all responsible sources were permitted to submit bids. The presence of two bids indicates a degree of competition, though the exact number of bidders can influence price discovery. A higher number of bidders typically leads to more competitive pricing.

Taxpayer Impact: Full and open competition is generally beneficial for taxpayers as it encourages multiple companies to vie for the contract, potentially driving down costs and improving the quality of services offered.

Public Impact

The primary beneficiaries are the U.S. Air Force and its operational units relying on the supported aircraft. Services delivered include sustainment, maintenance, and potentially logistics support for fixed-wing aircraft. The geographic impact is centered around Midwest City, Oklahoma, where Boeing Aerospace Operations is located. Workforce implications include employment opportunities for skilled technicians, engineers, and support staff at the contractor's facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope of work expands beyond initial estimates, despite FFP.
Dependence on a single contractor for critical aircraft sustainment could pose supply chain risks.
Ensuring adequate performance monitoring to guarantee service quality throughout the contract duration.

Positive Signals

Firm Fixed Price contract structure provides cost certainty for the government.
Long contract duration allows for stable planning and resource allocation for aircraft support.
Awarded through full and open competition, suggesting a competitive market was leveraged.
Contractor's established presence and experience in aerospace operations.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aircraft sustainment and support services. The market for such services is substantial, driven by the ongoing need to maintain aging fleets and ensure operational readiness of military aircraft. Comparable spending benchmarks would involve analyzing other large sustainment contracts for similar aircraft platforms across different military branches.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions or subcontracting requirements for this contract. Analysis of subcontracting plans would be necessary to determine the extent of small business participation and its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management office within the Department of the Air Force. Accountability measures would be defined in the contract's performance work statement and terms. Transparency is generally facilitated through contract award databases, though detailed performance metrics may not always be publicly available.

Related Government Programs

Aircraft Maintenance Services
Aerospace Logistics Support
Defense Aviation Sustainment
Fixed-Wing Aircraft Operations
Air Force Procurement

Risk Flags

Long-term contract duration may require ongoing performance monitoring.
Potential for scope creep if not managed tightly.
Dependence on contractor's supply chain for parts and services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.3 million to BOEING AEROSPACE OPERATIONS, INC.. 200405!000098!5700!GD90 !OC-ALC/LKD (CLS AIRCRAFT) !F0960301D0213 !A!N! !N!SD08 ! !20031022!20040930!194293544!085188316!009256819!N!BOEING AEROSPACE OPERATIONS, I!2601 LIBERTY PKWY !MIDWEST CITY !OK!73110!48350!109!40!MIDWEST CITY !OKLAHOMA !OKLAHOMA !+000003481289!N!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !000 !* !336413!E! !5!B!M! !A! !999

Who is the contractor on this award?

The obligated recipient is BOEING AEROSPACE OPERATIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $33.3 million.

What is the period of performance?

Start: 2003-10-22. End: 2008-09-30.

What is the historical spending pattern for aircraft sustainment by the Department of the Air Force, and how does this contract compare?

The Department of the Air Force consistently allocates significant portions of its budget to aircraft sustainment, encompassing maintenance, repair, overhaul, and spare parts. Historical data indicates billions of dollars are spent annually across various platforms. This $194 million contract, spanning approximately five years, represents a substantial but not unprecedented investment for supporting a specific fleet or set of aircraft. To provide a precise comparison, one would need to analyze the specific aircraft type supported by this contract and benchmark its sustainment costs against similar platforms within the Air Force's inventory over comparable periods. Factors such as aircraft age, operational tempo, and technological complexity heavily influence sustainment costs.

What is Boeing Aerospace Operations, Inc.'s track record with similar large-scale defense contracts?

Boeing Aerospace Operations, Inc. (a subsidiary of The Boeing Company) has a long and extensive track record of managing and executing large-scale defense contracts, particularly in aircraft manufacturing, sustainment, and support. They are a primary contractor for numerous U.S. military aircraft platforms, including fighters, bombers, transports, and specialized mission aircraft. Their experience typically involves complex logistics, maintenance, repair, and overhaul (MRO) services, often on multi-year, multi-billion dollar contracts. Past performance on similar contracts, including those involving fixed-price structures and long durations, would be a key indicator of their capability to successfully deliver on this specific award. Government contract databases and performance reviews would offer detailed insights into their historical success rates and any past issues.

How does the Firm Fixed Price (FFP) contract type mitigate risks for the government in this aircraft support scenario?

The Firm Fixed Price (FFP) contract type is designed to provide the government with cost certainty by establishing a ceiling on the total price. Under an FFP agreement, the contractor, Boeing Aerospace Operations, Inc., assumes the primary risk for any cost overruns incurred during contract performance. This means that if the costs of labor, materials, or other expenses escalate beyond what was anticipated, the contractor is responsible for absorbing those additional costs, rather than passing them on to the government. This structure is particularly beneficial for well-defined requirements like aircraft sustainment, where the scope of work can be clearly articulated. It incentivizes the contractor to manage their costs efficiently and effectively to maintain profitability, thereby aligning their interests with the government's objective of obtaining services at a predictable price.

What are the potential performance risks associated with a 5-year contract for aircraft sustainment?

A 5-year contract for aircraft sustainment, while offering stability, carries several potential performance risks. Firstly, the contractor's performance could degrade over time if incentives are not structured to maintain high standards throughout the period. Secondly, unforeseen technological advancements or changes in operational requirements could render the contracted services less effective or efficient, necessitating contract modifications. Thirdly, key personnel turnover at the contractor's organization could lead to a loss of institutional knowledge and impact service quality. Finally, the long duration might mask underlying inefficiencies that only become apparent towards the end of the contract term. Robust performance metrics, regular reviews, and clear contract modification clauses are essential to mitigate these risks.

What is the significance of the contract being awarded to Boeing Aerospace Operations, Inc. in Midwest City, Oklahoma?

The award to Boeing Aerospace Operations, Inc. in Midwest City, Oklahoma, signifies a significant economic contribution to that region. It implies the creation or sustainment of skilled jobs in aerospace engineering, maintenance, and logistics. Furthermore, it leverages the existing aerospace infrastructure and workforce capabilities present in Oklahoma, which has a notable defense and aerospace industry presence. For the Air Force, contracting with a company that has a strong regional footprint can sometimes offer logistical advantages and foster closer working relationships, although the primary considerations remain technical capability and price. This award reinforces the importance of the Oklahoma City area as a hub for aerospace operations and defense contracting.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: THE Boeing Company (UEI: 009256819)

Address: 6001 S AIR DEPOT BLVD, OKLAHOMA CITY, OK, 73135

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: F0960301D0213

IDV Type: IDC

Timeline