DoD awards $17M for Aircraft Engine Parts to General Electric, facing limited competition
Contract Overview
Contract Amount: $17,011,091 ($17.0M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2008-02-01
End Date: 2013-06-30
Contract Duration: 1,976 days
Daily Burn Rate: $8.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: TF39 08 CIP
Place of Performance
Location: CINCINNATI, HAMILTON County, OHIO, 45215
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $17.0 million to GENERAL ELECTRIC COMPANY for work described as: TF39 08 CIP Key points: 1. Significant contract value of $17 million. 2. Sole supplier for specific engine parts. 3. Potential for cost overruns due to Cost Plus Fixed Fee contract type. 4. Manufacturing sector focus on aircraft engines.
Value Assessment
Rating: fair
The Cost Plus Fixed Fee contract type can lead to higher costs than fixed-price contracts if not managed closely. Benchmarking against similar engine part contracts is difficult without more specific data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not competed, suggesting General Electric may be the sole source or a preferred provider for these specific aircraft engine parts. This lack of competition limits price discovery and potentially increases costs.
Taxpayer Impact: Taxpayer funds are used for this procurement. Without competitive bidding, there's a risk of paying a premium for these parts, impacting overall defense spending efficiency.
Public Impact
Ensures continued availability of critical aircraft engine parts for military operations. Supports a major defense contractor and its supply chain. Highlights potential inefficiencies in defense procurement processes when competition is limited.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost Plus Fixed Fee contract type
- Long contract duration
Positive Signals
- Ensures critical part availability
- Supports established supplier
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft engine components. Spending in this area is critical for maintaining military readiness but is also susceptible to high costs due to specialized requirements and limited suppliers.
Small Business Impact
The data indicates no specific set-aside for small businesses. Large prime contractors like General Electric often manage complex supply chains, and the extent of small business participation is not detailed here.
Oversight & Accountability
Oversight is provided by the Defense Contract Management Agency. The Cost Plus Fixed Fee structure necessitates diligent monitoring to ensure costs remain reasonable and within the fixed fee parameters.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Limited competition may lead to higher prices.
- Cost Plus Fixed Fee contract type carries inherent cost escalation risks.
- Long contract duration increases exposure to market fluctuations.
- Lack of small business participation noted.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, oh, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $17.0 million to GENERAL ELECTRIC COMPANY. TF39 08 CIP
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $17.0 million.
What is the period of performance?
Start: 2008-02-01. End: 2013-06-30.
What is the specific justification for not competing this contract, and are there viable alternatives for future procurements?
The justification for not competing is not provided in the data. Future procurements should explore options for increasing competition, such as breaking down the requirement into smaller lots, encouraging new entrants, or developing alternative part specifications to broaden the supplier base and improve price discovery.
How does the Cost Plus Fixed Fee structure impact the final cost compared to other contract types for similar engine parts?
Cost Plus Fixed Fee contracts allow the contractor to recover all allowable costs plus a predetermined fixed fee. This can lead to higher final costs compared to fixed-price contracts if the contractor's costs are higher than anticipated. Effective oversight is crucial to manage cost growth and ensure the fee remains appropriate for the effort.
What is the long-term strategy for ensuring a competitive and cost-effective supply of these critical aircraft engine parts?
A long-term strategy should involve market research to identify potential competitors, exploring opportunities for technology insertion or redesign to enable competition, and potentially developing strategic partnerships or long-term agreements that incentivize cost reduction and innovation from a broader range of suppliers.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 1 NEUMANN WAY, CINCINNATI, OH, 45215
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $25,136,716
Exercised Options: $25,136,716
Current Obligation: $17,011,091
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: F3365799D2050
IDV Type: IDC
Timeline
Start Date: 2008-02-01
Current End Date: 2013-06-30
Potential End Date: 2013-06-30 00:00:00
Last Modified: 2018-02-05
More Contracts from General Electric Company
- 200607!387702!1700!n00019!naval AIR Systems Command !N0001906C0088 !A!N! !N! ! !20060424!20090131!001408509!001408509!001367960!n!general Electric Company !1000 Western AVE !lynn !ma!01905!37490!009!25!lynn !essex !mass !+000018238000!n!n!000000000000!2840!gas Turbines and JET Engines, Acft & Comps !a1b!aircraft Engines and Spares !000 !NOT Discernable !336412!E! !3! ! ! ! ! !99990909!B! ! !A! !d!u!j!1!001!n!1a!z!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!b!y! ! ! !Y!1719!N00019!0001! ! — $2.4B (Department of Defense)
- Adaptive Engine Transition Program (aetp) — $2.1B (Department of Defense)
- 200608!001069!2100!w58rgz!usa Aviation and Missile Command!w58rgz06c0038 !A!N! !Y! ! !20051215!20101231!137488664!137488664!001367960!n!general Electric Company !1 Neumann WAY !cincinnati !oh!45215!15000!061!39!cincinnati !hamilton !ohio !+000177879422!n!n!000000000000!r706!logistics Support Services !a1b!aircraft Engines and Spares !000 !NOT Discernable !541330!E! !3! ! ! ! ! !99990909!B! ! !A! !d!n!j!1!001!n!1g!z!n!z! ! !Y!C!N! ! ! !a!a!a!a!000!a!d!n! ! ! ! ! ! !0001! ! — $1.6B (Department of Defense)
- 200210!004379!1700!AA427 !naval AIR Systems Command !N0001901C0147 !A!N! !N!P00001 !20020508!20031130!001408509!001408509!001367960!n!general Electric Company Inc !1000 Western AVE !lynn !ma!01910!37490!009!25!lynn !essex !mass !+000060619860!n!n!000000000000!2840!gas Turbines and JET Engines, Acft & Comps !a1b!aircraft Engines and Spares !2bjn!f414-Ge-400 !336412!E! !1! ! !C! ! !99990909!B! ! !A! !d!n!j!1!001!n!1a!a!w!f! ! !N!C!N! ! ! !a!a!a!a!000!a!b!y! ! ! ! ! ! !0001! — $1.5B (Department of Defense)
- F414-GE-400 Engines — $1.2B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)