DoD's $11.4M Combustion Chamber Contract Awarded to RTX Corporation Raises Value Questions

Contract Overview

Contract Amount: $11,390,061 ($11.4M)

Contractor: RTX Corporation

Awarding Agency: Department of Defense

Start Date: 2006-12-18

End Date: 2009-03-31

Contract Duration: 834 days

Daily Burn Rate: $13.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: NOT REPORTED

Sector: Defense

Official Description: COMBUSTION CHAMBER

Place of Performance

Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06108

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $11.4 million to RTX CORPORATION for work described as: COMBUSTION CHAMBER Key points: 1. The contract's value proposition is unclear due to limited competition and lack of detailed performance metrics. 2. Competition dynamics were heavily restricted, with a sole-source award potentially impacting price discovery. 3. Risk indicators are moderate, primarily stemming from the limited competition and the age of the contract. 4. Performance context is minimal, with no readily available data on the effectiveness or efficiency of the delivered combustion chambers. 5. This contract falls within the Defense sector, specifically supporting aircraft engine components.

Value Assessment

Rating: questionable

Benchmarking the value of this $11.4 million contract is challenging without comparable sole-source awards or detailed cost breakdowns. The lack of competition suggests potential overpricing. Given the contract's age and limited public information, assessing its overall value for money is difficult. Further analysis would require access to the contractor's cost structure and justification for the pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, indicating that only one bidder, RTX Corporation, was considered capable of fulfilling the requirement. This severely limits the competitive landscape and raises concerns about whether the government obtained the best possible price and terms.

Taxpayer Impact: Sole-source awards limit taxpayer benefit by removing the pressure of competitive bidding, potentially leading to higher costs than if multiple companies had vied for the contract.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Air Force, which receives critical aircraft engine components. The services delivered involve the manufacturing of combustion chambers, essential for aircraft engine functionality. The geographic impact is primarily within Connecticut, where RTX Corporation is based, and potentially at the Air Force bases where the engines are utilized. Workforce implications include employment at RTX Corporation's manufacturing facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may have led to suboptimal pricing.
Lack of detailed performance data hinders value assessment.
Contract awarded in 2006, potentially outdated technology or pricing.

Positive Signals

RTX Corporation is a major defense contractor with established expertise.
The contract addresses a critical component for military aircraft.

Sector Analysis

This contract falls within the Defense Industrial Base, specifically the Aircraft Engine and Engine Parts Manufacturing sector. This sector is characterized by high barriers to entry, significant R&D investment, and a concentration of large, established players like RTX Corporation. Spending in this area is critical for national security and maintaining military readiness. Comparable spending benchmarks are difficult to ascertain without more specific details on the type and quantity of combustion chambers procured.

Small Business Impact

This contract does not appear to have involved small business set-asides, as indicated by the 'sb': false flag. Given the sole-source nature and the specialized product, it is unlikely that subcontracting opportunities for small businesses were a primary consideration or explicitly mandated. The focus was likely on the prime contractor's capabilities.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the Department of Defense's contracting officers and potentially the Inspector General's office. However, with limited public data and a sole-source award, the extent of transparency and accountability is difficult to assess. The age of the contract also means that current oversight might be minimal unless extended or re-competed.

Related Government Programs

Aircraft Engine Manufacturing
Defense Procurement
Air Force Logistics
Aerospace Components

Risk Flags

Sole-source award limits competition.
Lack of performance metrics hinders value assessment.
Contract awarded over 15 years ago.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.4 million to RTX CORPORATION. COMBUSTION CHAMBER

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 $11.4 million.

What is the period of performance?

Start: 2006-12-18. End: 2009-03-31.

What is RTX Corporation's track record with similar sole-source defense contracts?

RTX Corporation, through its various subsidiaries (including Pratt & Whitney, which is a major engine manufacturer), has a long history of securing defense contracts, many of which are sole-source due to the specialized nature of aerospace components and systems. Analyzing their broader portfolio of sole-source awards could reveal patterns in pricing, performance, and justification strategies. However, specific details on past sole-source combustion chamber contracts are not publicly available in this dataset. Generally, large defense contractors like RTX are expected to provide detailed justifications for sole-source bids, including technical data and cost breakdowns, which are then reviewed by the procuring agency. The government's ability to negotiate favorable terms in sole-source situations often depends on the thoroughness of this review and the contractor's willingness to provide transparent cost information.

How does the $11.4 million award compare to market rates for combustion chambers?

Directly comparing the $11.4 million award to market rates for combustion chambers is challenging without knowing the specific type, quantity, and technical specifications of the components procured under this contract. Combustion chambers can vary significantly in complexity, materials, and performance requirements, leading to wide price ranges. Furthermore, as this was a sole-source award, the price may not reflect competitive market dynamics. To establish a benchmark, one would need to identify comparable sole-source contracts for similar components, analyze the contractor's cost breakdown (if available), or consult industry pricing data for high-performance aerospace parts. The absence of such comparative data makes a definitive value assessment difficult.

What are the primary risks associated with this sole-source contract?

The primary risks associated with this sole-source contract include potential overpricing due to the lack of competitive bidding, reduced incentive for the contractor to innovate or improve efficiency, and a lack of transparency in the procurement process. Without competition, the government relies heavily on the contractor's cost proposals and the agency's negotiation skills. There's also a risk that alternative, potentially more cost-effective solutions might not be explored. Given the contract's award date (2006), there's a risk of using outdated technology or pricing structures that may not align with current market conditions or technological advancements. Ensuring robust oversight and justification for sole-source awards is crucial to mitigate these risks.

What was the historical spending pattern for combustion chambers by the Department of Defense?

Historical spending patterns for combustion chambers by the Department of Defense are likely substantial and have evolved over time with advancements in engine technology and fleet requirements. The DoD procures a vast array of aircraft, and each requires sophisticated engine components like combustion chambers. Spending in this category would fluctuate based on new aircraft procurements, upgrades to existing fleets, and sustainment contracts for engine maintenance and parts. Analyzing historical data would involve looking at aggregate spending on aircraft engine parts (NAICS code 336412) or specific line items for combustion chambers across different military branches and fiscal years. This particular $11.4 million contract represents a small fraction of the overall historical spending but highlights the ongoing need for these critical components.

How effective was the Air Force in ensuring value for money with this sole-source award?

Assessing the effectiveness of the Air Force in ensuring value for money with this sole-source award is difficult based solely on the provided data. Sole-source awards inherently present challenges to achieving optimal value compared to competitive procurements. The effectiveness would depend on the rigor of the Air Force's justification review process, the negotiation tactics employed, and the accuracy of the cost and technical data provided by RTX Corporation. Without access to the contractor's cost proposals, the government's cost analysis, and detailed performance metrics post-award, it's impossible to definitively state whether the Air Force secured the best possible value. The limited information suggests a potential for suboptimal value.

Industry Classification

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

Product/Service Code: ENGINES AND TURBINES AND COMPONENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: NOT REPORTED (NO)

Evaluated Preference: NONE

Contractor Details

Parent Company: RTX Corp (UEI: 001344142)

Address: 400 MAIN ST, EAST HARTFORD, CT, 01

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

Financial Breakdown

Contract Ceiling: $11,390,061

Exercised Options: $11,390,061

Current Obligation: $11,390,061

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SP040001D9405

IDV Type: IDC

Timeline