DoD's $12.6M contract for aircraft engines awarded to RTX Corporation, raising questions about competition
Contract Overview
Contract Amount: $12,604,205 ($12.6M)
Contractor: RTX Corporation
Awarding Agency: Department of Defense
Start Date: 2007-03-27
End Date: 2009-09-30
Contract Duration: 918 days
Daily Burn Rate: $13.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: SEAL, AIR, AIRCRAFT G
Place of Performance
Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06108
Plain-Language Summary
Department of Defense obligated $12.6 million to RTX CORPORATION for work described as: SEAL, AIR, AIRCRAFT G Key points: 1. Significant spending on aircraft engine components highlights a critical defense sector. 2. Sole-source award to RTX Corporation suggests limited market competition. 3. Long-term contract duration may impact price competitiveness over time. 4. The 'Aircraft Engine and Engine Parts Manufacturing' sector is highly specialized.
Value Assessment
Rating: questionable
The contract value of $12.6 million for aircraft engines is difficult to assess without specific part details. However, given the specialized nature of aerospace components, this amount could be reasonable for a firm-fixed-price contract, but the lack of competition is a concern.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating that only one vendor, RTX Corporation, was considered capable of fulfilling the requirement. This significantly limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competitive bidding on this $12.6 million contract means taxpayers may not have received the best possible price, as there was no market pressure to drive down costs.
Public Impact
Ensures continued operational readiness for Air Force aircraft by providing essential engine parts. Supports a major defense contractor, RTX Corporation, and its supply chain. Potential for higher costs due to the absence of competitive pricing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Essential for aircraft operations
- Firm fixed price contract
Sector Analysis
The 'Aircraft Engine and Engine Parts Manufacturing' sector is a highly technical and consolidated industry. Spending benchmarks are difficult to establish without specific part numbers and quantities, but defense contracts in this area are typically substantial due to R&D and manufacturing complexity.
Small Business Impact
This contract was awarded to RTX Corporation, a large prime contractor. There is no indication of small business participation in this specific award, suggesting that opportunities for small businesses may be limited for this particular requirement.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure that the Department of Defense adequately justified the lack of competition and that the pricing is fair and reasonable. Further review of the justification for sole-source procurement is recommended.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing due to lack of competition.
- Long contract duration may reduce future price flexibility.
- Lack of transparency regarding justification for sole-source.
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 $12.6 million to RTX CORPORATION. SEAL, AIR, AIRCRAFT G
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 $12.6 million.
What is the period of performance?
Start: 2007-03-27. End: 2009-09-30.
What was the specific justification for awarding this contract on a sole-source basis, and were alternative solutions explored?
The justification for a sole-source award typically involves factors such as unique technical capabilities, urgent needs, or the unavailability of other sources. Without the specific justification document, it's impossible to confirm the exact reasons. However, the government should have explored all reasonable avenues for competition before resorting to a sole-source procurement to ensure taxpayer value.
How does the pricing of this contract compare to similar sole-source or competitively bid contracts for comparable aircraft engine parts?
Benchmarking pricing for sole-source contracts is challenging due to the inherent lack of comparative data. A thorough review would involve comparing the unit costs, if available, against historical data for similar parts procured under competitive conditions or against industry benchmarks for specialized aerospace components. The absence of competition suggests a higher risk of non-competitive pricing.
What is the long-term impact of this sole-source award on the Air Force's ability to procure these engine parts efficiently and cost-effectively in the future?
Sole-source awards can diminish market competition over time, potentially leading to increased prices and reduced innovation for future procurements. The Air Force should consider strategies to foster competition for these parts in subsequent contract actions, perhaps by breaking down requirements or encouraging new entrants into the market, to ensure long-term cost-effectiveness.
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: FIRM FIXED PRICE (J)
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, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $12,604,205
Exercised Options: $12,604,205
Current Obligation: $12,604,205
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SP040001D9405
IDV Type: IDC
Timeline
Start Date: 2007-03-27
Current End Date: 2009-09-30
Potential End Date: 2009-09-30 00:00:00
Last Modified: 2013-02-23
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