DoD's $53.5M Aircraft Engine Contract with RTX Corporation: A Deep Dive into Value and Competition
Contract Overview
Contract Amount: $53,476,223 ($53.5M)
Contractor: RTX Corporation
Awarding Agency: Department of Defense
Start Date: 2007-09-24
End Date: 2014-12-31
Contract Duration: 2,655 days
Daily Burn Rate: $20.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: CONTROL UNIT,SUPERV
Place of Performance
Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06108
Plain-Language Summary
Department of Defense obligated $53.5 million to RTX CORPORATION for work described as: CONTROL UNIT,SUPERV Key points: 1. Significant contract value of $53.5M awarded to RTX Corporation. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. Potential risks include long contract duration and reliance on a single manufacturer. 4. Spending falls within the Aircraft Engine and Engine Parts Manufacturing sector.
Value Assessment
Rating: good
The contract value of $53.5M for aircraft engines appears reasonable given the duration and the nature of the goods. Benchmarking against similar long-term defense contracts for specialized engine parts would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to compete. This method generally promotes price discovery and can lead to more favorable pricing for the government.
Taxpayer Impact: The competitive nature of the award suggests taxpayers likely benefited from a fair market price for these critical aircraft engine components.
Public Impact
Ensures continued operational readiness for Air Force aircraft through a steady supply of essential engine parts. Supports a major defense contractor, contributing to jobs and technological advancement in the aerospace industry. Long-term nature of the contract provides stability for both the government's supply chain and the contractor's production.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (2655 days) could lead to price escalation or obsolescence.
- Sole reliance on RTX Corporation for these specific parts may limit future negotiation leverage.
- Firm Fixed Price contract offers limited flexibility if unforeseen cost increases occur.
Positive Signals
- Awarded through full and open competition, indicating a robust bidding process.
- Contract supports critical defense needs for the Department of the Air Force.
- Clear end dates (2014) suggest the contract is likely completed or in its final stages.
Sector Analysis
This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector, a critical component of the aerospace and defense industry. Spending in this area is often characterized by high R&D costs, long product lifecycles, and significant government oversight due to national security implications.
Small Business Impact
The data does not indicate any specific provisions or awards made to small businesses under this contract. Further analysis would be needed to determine if small business participation was encouraged or achieved.
Oversight & Accountability
The contract was awarded by the Department of the Air Force, implying oversight from relevant defense contracting and auditing agencies. The firm fixed price structure suggests a focus on cost control from the outset.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Long contract duration
- Potential for price escalation over time
- Reliance on a single contractor for specific parts
- Lack of explicit small business participation data
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ct, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $53.5 million to RTX CORPORATION. CONTROL UNIT,SUPERV
Who is the contractor on this award?
The obligated recipient is RTX CORPORATION.
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 $53.5 million.
What is the period of performance?
Start: 2007-09-24. End: 2014-12-31.
What was the specific impact of the firm fixed price contract on the final cost to the government, especially considering the long duration?
A firm fixed price contract aims to transfer risk to the contractor, locking in costs. However, for a long duration like 2655 days, the initial price might not reflect later market fluctuations or unforeseen production challenges. The government's benefit depends on the accuracy of the initial cost estimation by RTX and the contractor's ability to manage risks effectively without compromising quality or delivery.
How did the 'full and open competition' process ensure the best value was achieved for taxpayers, given the specialized nature of aircraft engines?
Full and open competition allows multiple qualified vendors to bid, fostering a competitive environment that typically drives down prices and encourages innovation. For specialized items like aircraft engines, the challenge lies in defining clear specifications that allow for meaningful comparison between bidders while ensuring technical requirements are met. The success of this method hinges on the thoroughness of the solicitation and the evaluation criteria used.
What are the long-term implications for the Air Force's supply chain and maintenance capabilities stemming from this specific contract?
This contract likely ensured a stable supply of critical engine parts for a defined period, supporting aircraft readiness. However, the long duration and potential reliance on a single supplier could pose risks for future supply chain flexibility and potentially higher costs if new, more efficient technologies emerge. Diversification strategies might be considered for subsequent contracts to mitigate these long-term risks.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: ENGINE ACCESSORIES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 400 MAIN STREET, EAST HARTFORD, FL
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $53,477,423
Exercised Options: $53,477,423
Current Obligation: $53,476,223
Contract Characteristics
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: F3365798D0018
IDV Type: IDC
Timeline
Start Date: 2007-09-24
Current End Date: 2014-12-31
Potential End Date: 2014-12-31 00:00:00
Last Modified: 2014-11-04
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