AAR Supply Chain secures $4.8M contract for aircraft parts, highlighting specialized manufacturing capabilities

Contract Overview

Contract Amount: $4,845,489 ($4.8M)

Contractor: AAR Supply Chain, Inc

Awarding Agency: Department of Defense

Start Date: 2025-11-17

End Date: 2026-07-30

Contract Duration: 255 days

Daily Burn Rate: $19.0K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 8511725567!SEAL,GUNMOUNT

Place of Performance

Location: WOOD DALE, DUPAGE County, ILLINOIS, 60191

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $4.8 million to AAR SUPPLY CHAIN, INC for work described as: 8511725567!SEAL,GUNMOUNT Key points: 1. Contract value of $4.8M for aircraft parts suggests a need for specialized components. 2. Competition dynamics for this contract are not detailed, impacting price discovery assessment. 3. Risk indicators are moderate, given the definitive contract type and fixed-price structure. 4. Performance context is tied to the Defense Logistics Agency's ongoing supply chain needs. 5. Sector positioning is within the broader aerospace and defense manufacturing industry.

Value Assessment

Rating: good

The contract value of $4.8M for aircraft parts appears reasonable for specialized components. Benchmarking against similar contracts for specific aircraft parts would provide a more precise value-for-money assessment. The firm fixed-price structure suggests a degree of cost certainty for the government, assuming the scope is well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: unknown

The contract was competed under SAP (Simplified Acquisition Procedures), which typically involves a less extensive competition process than full and open competition. The number of bidders and the specific method of competition are not detailed, making it difficult to assess the breadth of market engagement and its impact on pricing.

Taxpayer Impact: Simplified acquisition procedures may result in less competitive pricing compared to full and open solicitations, potentially leading to higher costs for taxpayers if not managed carefully.

Public Impact

The Department of Defense benefits from the acquisition of essential aircraft parts. Services delivered include the supply of specialized aircraft components, crucial for fleet readiness. Geographic impact is primarily within the defense supply chain, supporting military operations. Workforce implications are likely within the specialized manufacturing and logistics sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed competition information limits assessment of optimal price discovery.
Potential for higher costs due to simplified acquisition procedures if competition was limited.
Dependence on a single contractor for specific parts could pose supply chain risks.

Positive Signals

Firm fixed-price contract provides cost predictability.
Award to AAR Supply Chain, Inc. suggests established capabilities in the aerospace sector.
Contract duration of 255 days ensures timely supply for a defined period.

Sector Analysis

The aerospace and defense manufacturing sector is characterized by high technological complexity and stringent quality requirements. This contract for aircraft parts fits within the broader industry landscape, where specialized suppliers play a critical role in maintaining military aviation assets. Comparable spending benchmarks for aircraft parts can vary significantly based on the specific components and aircraft platforms involved.

Small Business Impact

This contract does not appear to have a small business set-aside. Analysis of subcontracting opportunities for small businesses is not possible without further details on the contract's execution. The impact on the small business ecosystem is likely minimal unless AAR Supply Chain actively engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would fall under the Defense Contract Management Agency (DCMA) and the Defense Contract Audit Agency (DCAA), responsible for ensuring compliance with contract terms and financial accountability. Transparency is facilitated through contract databases, but detailed performance metrics are not publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance and Repair
Aerospace Parts Manufacturing
Defense Logistics Support
Military Aircraft Sustainment

Risk Flags

Simplified Acquisition Procedures may limit competition.
Lack of detailed competition data hinders value assessment.
Potential for supply chain disruption if contractor fails to deliver.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $4.8 million to AAR SUPPLY CHAIN, INC. 8511725567!SEAL,GUNMOUNT

Who is the contractor on this award?

The obligated recipient is AAR SUPPLY CHAIN, INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $4.8 million.

What is the period of performance?

Start: 2025-11-17. End: 2026-07-30.

What is AAR Supply Chain, Inc.'s track record with the Department of Defense?

AAR Supply Chain, Inc. has a history of providing logistics and supply chain solutions to the Department of Defense. While specific details of past performance on similar contracts are not provided in this data, their involvement suggests a recognized capability in supporting defense logistics. Further investigation into their contract history, including past performance reviews and any documented issues, would be necessary for a comprehensive assessment. Their sustained presence in the defense sector indicates a level of reliability and expertise that the DoD values for critical supply chain functions.

How does the $4.8M contract value compare to similar aircraft parts procurements?

The $4.8M contract value for aircraft parts is a moderate sum within the defense procurement landscape. Without knowing the specific type and quantity of parts, a direct comparison is challenging. However, for specialized or high-demand components, this value can be considered reasonable. Larger contracts often involve entire systems or extensive overhauls, while this appears to be for discrete parts. Benchmarking against contracts for similar component categories (e.g., engine parts, avionics, structural components) from the Defense Logistics Agency or other branches would provide a clearer picture of value for money.

What are the primary risks associated with this contract?

The primary risks associated with this contract include potential supply chain disruptions if AAR Supply Chain faces production or delivery issues, and the risk of cost overruns if the firm fixed-price contract does not adequately account for unforeseen expenses, though this is mitigated by the fixed-price nature. Another risk is the potential for obsolescence of the parts over time, depending on the aircraft's lifecycle. Furthermore, if the competition under SAP was limited, there's a risk that the government did not secure the most competitive pricing available in the market.

How effective is the Defense Logistics Agency in managing contracts like this?

The Defense Logistics Agency (DLA) is a major combat support agency responsible for providing logistics, acquisition, and support services to the U.S. Armed Forces. DLA manages a vast number of contracts, including those for aircraft parts, and employs established processes for contract oversight, performance monitoring, and risk management. Their effectiveness is generally considered high, given their critical role in maintaining military readiness. However, the effectiveness of any specific contract's management depends on factors like the clarity of the statement of work, the diligence of contract officers, and the contractor's performance.

What are the historical spending patterns for aircraft parts by the Defense Logistics Agency?

The Defense Logistics Agency consistently spends billions of dollars annually on a wide array of spare parts, including those for aircraft. Historical spending patterns show a significant and ongoing investment in maintaining the readiness of military aviation fleets. This spending is driven by the operational tempo, the age of aircraft, and the need for modernization. The DLA's procurement of aircraft parts is a critical component of its overall mission to provide integrated logistics support across the Department of Defense, ensuring that aircraft are operational and mission-capable.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: AAR Government Services Inc.

Address: 1100 N WOOD DALE RD, WOOD DALE, IL, 60191

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $4,845,489

Exercised Options: $4,845,489

Current Obligation: $4,845,489

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline