DoD's $15.9M Contract for Aircraft Engine Services Awarded to General Electric Company
Contract Overview
Contract Amount: $15,927,511 ($15.9M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2009-02-21
End Date: 2012-12-31
Contract Duration: 1,409 days
Daily Burn Rate: $11.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: ENGINEERING SERVICES
Place of Performance
Location: CINCINNATI, HAMILTON County, OHIO, 45215
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $15.9 million to GENERAL ELECTRIC COMPANY for work described as: ENGINEERING SERVICES Key points: 1. General Electric Company secured a significant contract valued at $15.9 million. 2. The contract falls under the Aircraft Engine and Engine Parts Manufacturing sector. 3. Awarded by the Department of the Air Force, this contract highlights a specific area of defense spending. 4. The contract duration spans over three years, indicating a sustained need for these services.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. Without a competitive bidding process, it's difficult to assess if the $15.9 million represents a fair market price.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no competitive pressure to drive down the price.
Taxpayer Impact: The lack of competition for this $15.9 million contract may result in taxpayers paying more than necessary for engineering services.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The Department of the Air Force relies on General Electric for critical aircraft engine services. This contract could set a precedent for future sole-source awards in this sector. The long duration of the contract suggests a continuous requirement for these specialized engineering services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost Plus Fixed Fee contract type
- Potential for cost overruns
Positive Signals
- Sustained need for critical services
- Award to established company
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 and specialized manufacturing capabilities.
Small Business Impact
There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. The award was made directly to General Electric Company.
Oversight & Accountability
The 'OH' designation suggests the contract may be subject to oversight in Ohio. However, the lack of competition raises questions about the effectiveness of existing oversight mechanisms in ensuring competitive pricing.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award lacks competition
- Cost Plus Fixed Fee contract type increases risk
- Potential for inflated pricing
- Limited transparency in pricing justification
- No apparent small business participation
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, oh, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.9 million to GENERAL ELECTRIC COMPANY. ENGINEERING SERVICES
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
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 $15.9 million.
What is the period of performance?
Start: 2009-02-21. End: 2012-12-31.
What was the justification for awarding this contract on a sole-source basis instead of through full and open competition?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent requirements where only one source can fulfill the need. Without specific documentation, it's impossible to determine the exact reason, but it's crucial for ensuring that such awards are truly necessary and not simply a matter of convenience or established relationships.
What measures were in place to control costs given the Cost Plus Fixed Fee structure and lack of competition?
Cost Plus Fixed Fee contracts require robust oversight to manage costs effectively. This includes detailed auditing of expenses, performance monitoring, and clear definition of the fixed fee. The absence of competition means the government must rely heavily on its internal controls and negotiation skills to prevent excessive spending and ensure value for money.
How does the pricing of this contract compare to similar sole-source or competed contracts for aircraft engine services?
Benchmarking this contract's pricing is challenging without access to detailed cost breakdowns and comparable contract data. However, sole-source contracts are generally expected to be higher than competed ones. A thorough review would involve comparing the labor rates, overheads, and profit margins against industry standards and any available historical data for similar services.
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, 90
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $15,927,511
Exercised Options: $15,927,511
Current Obligation: $15,927,511
Contract Characteristics
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: F3365799D2050
IDV Type: IDC
Timeline
Start Date: 2009-02-21
Current End Date: 2012-12-31
Potential End Date: 2012-12-31 00:00:00
Last Modified: 2014-09-16
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