Boeing awarded $60.1M contract for NAVAIR IPS, a sole-source delivery order
Contract Overview
Contract Amount: $60,120,979 ($60.1M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2019-12-19
End Date: 2020-12-31
Contract Duration: 378 days
Daily Burn Rate: $159.1K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: NAVAIR IPS
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $60.1 million to THE BOEING COMPANY for work described as: NAVAIR IPS Key points: 1. Contract value represents a significant investment in aircraft parts and auxiliary equipment. 2. Sole-source award suggests limited market alternatives or specific contractor capabilities. 3. Delivery order structure indicates a need for immediate or phased supply. 4. Fixed-price contract type shifts cost risk to the contractor. 5. Contract duration of 378 days suggests a medium-term supply requirement. 6. Awarded by the Department of Defense, highlighting its strategic importance.
Value Assessment
Rating: fair
The contract value of $60.1 million for aircraft parts and auxiliary equipment is substantial. Without specific benchmarks for NAVAIR IPS, it's difficult to definitively assess value for money. However, as a sole-source award, there's a reduced opportunity for competitive pricing, which could lead to less favorable terms compared to a competed contract. The firm fixed-price structure provides cost certainty for the government, but the absence of competitive bids raises questions about whether the price reflects the best possible market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed. This typically occurs when only one responsible source is available or when there is a compelling justification for not seeking competition. The lack of multiple bidders means there was no direct price comparison or negotiation driven by market forces, potentially impacting the final price achieved.
Taxpayer Impact: Sole-source awards limit the government's ability to leverage competition to secure the lowest possible prices, potentially resulting in higher costs for taxpayers.
Public Impact
The primary beneficiaries are likely the Department of Defense and its aviation units, receiving essential aircraft parts and auxiliary equipment. The contract supports the operational readiness and maintenance of naval aircraft. The geographic impact is centered around the delivery and integration of these parts, potentially involving NAVAIR facilities. Workforce implications may include roles in manufacturing, quality control, and logistics at The Boeing Company and its supply chain.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to higher prices than a competed contract.
- Sole-source awards can reduce transparency in pricing and value assessment.
- Dependence on a single contractor for critical components can pose supply chain risks.
Positive Signals
- Firm fixed-price contract provides cost certainty for the government.
- Award to a major defense contractor like Boeing suggests established capabilities and reliability.
- Delivery order structure allows for phased or immediate fulfillment of needs.
Sector Analysis
The aerospace and defense sector is characterized by high barriers to entry, complex supply chains, and significant government procurement. Contracts for aircraft parts and auxiliary equipment are crucial for maintaining fleet readiness and technological advancement. The market size for such components is substantial, driven by global defense spending. This contract fits within the broader category of defense sustainment and modernization, where specialized manufacturing capabilities are paramount.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the prime contractor is The Boeing Company, a large aerospace firm. While Boeing may utilize small businesses in its supply chain, this specific award does not directly benefit small businesses through a set-aside. The subcontracting opportunities for small businesses would depend on Boeing's internal procurement practices and the nature of the components required.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Defense's contracting and program management structures, including the Defense Contract Management Agency (DCMA). As a sole-source award, scrutiny might focus on the justification for non-competition and the reasonableness of the price. Transparency is limited by the lack of competitive bidding, but contract performance and payment would be subject to standard government oversight and audit procedures.
Related Government Programs
- NAVAIR Procurement
- Defense Aircraft Maintenance
- Aerospace Component Manufacturing
- Sole-Source Defense Contracts
- Fixed-Price Supply Contracts
Risk Flags
- Sole-source award lacks competitive pricing.
- Potential for higher costs due to lack of competition.
- Dependency on a single supplier.
Tags
defense, department-of-defense, navair, the-boeing-company, sole-source, delivery-order, firm-fixed-price, aircraft-parts, missouri, non-competed
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $60.1 million to THE BOEING COMPANY. NAVAIR IPS
Who is the contractor on this award?
The obligated recipient is THE BOEING 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 $60.1 million.
What is the period of performance?
Start: 2019-12-19. End: 2020-12-31.
What is the historical spending pattern for NAVAIR IPS with The Boeing Company?
Analyzing historical spending for NAVAIR IPS with The Boeing Company requires access to detailed contract databases beyond the provided data. However, the current award of $60.1 million for a 378-day period suggests a significant, medium-term investment. Without prior contract data, it's impossible to determine if this represents an increase, decrease, or consistent level of spending. Future analysis should aim to identify previous contracts for the same or similar services/products to establish a trend and assess year-over-year or program-lifecycle spending patterns. This would help in understanding the long-term commitment and potential for cost escalation or savings.
How does the pricing of this contract compare to similar sole-source awards for aircraft parts?
Benchmarking the pricing of this $60.1 million sole-source contract against similar awards is challenging without access to a comprehensive database of comparable sole-source procurements for aircraft parts. Sole-source contracts inherently lack the competitive pressure that drives down prices, making direct comparisons difficult. Key factors influencing price include the specific components, quantities, technological complexity, and urgency of need. To assess value, one would ideally compare the per-unit cost or total price against historical sole-source awards for identical or highly similar items, adjusted for inflation and quantity. The absence of competition means the government relies on negotiation and cost analysis to ensure price reasonableness, which is a less robust method than competitive bidding.
What are the primary risks associated with this sole-source contract for NAVAIR IPS?
The primary risks associated with this sole-source contract stem from the lack of competition. Firstly, there's a significant risk of paying a higher price than would be achievable in a competitive environment, as there's no market pressure to offer the lowest bid. Secondly, there's a potential for reduced innovation or responsiveness from the contractor, as they face less pressure from potential competitors. Thirdly, a sole-source award can create a dependency on The Boeing Company for these specific parts, potentially leading to supply chain vulnerabilities if Boeing faces production issues or decides to discontinue the product line. Finally, the justification for sole-sourcing itself could be subject to review, raising administrative or compliance risks if not adequately documented.
What is the expected program effectiveness or outcome of this contract?
The expected outcome of this contract is the timely delivery of essential aircraft parts and auxiliary equipment for the NAVAIR IPS program. The effectiveness will be measured by the quality and reliability of the delivered components, their contribution to the operational readiness of naval aircraft, and the overall support provided to the fleet. As a firm fixed-price contract, the government expects to receive the specified goods within the agreed-upon budget. The success hinges on The Boeing Company's ability to meet the technical specifications and delivery schedules outlined in the contract, thereby ensuring the continued functionality and maintenance of critical naval aviation assets.
What is the track record of The Boeing Company in fulfilling similar defense contracts?
The Boeing Company has an extensive and long-standing track record of fulfilling complex defense contracts for the U.S. Department of Defense and international partners. They are a major global aerospace company with significant experience in manufacturing aircraft, defense systems, and related components. While specific performance metrics for this particular NAVAIR IPS contract are not yet available due to its recent award, Boeing's history includes numerous large-scale programs, often involving intricate supply chains and advanced technologies. Their track record generally demonstrates a capacity to deliver sophisticated products, though like any large contractor, they have faced challenges and scrutiny on specific programs regarding cost, schedule, and performance. Independent reviews and government performance ratings would provide a more granular assessment.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JS MCDONNELL BLVD, SAINT LOUIS, MO, 63134
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $62,096,288
Exercised Options: $62,096,288
Current Obligation: $60,120,979
Subaward Activity
Number of Subawards: 10
Total Subaward Amount: $8,074,935
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPRPA114D002U
IDV Type: IDC
Timeline
Start Date: 2019-12-19
Current End Date: 2020-12-31
Potential End Date: 2020-12-31 00:00:00
Last Modified: 2023-08-02
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