DoD Awards Boeing $19.7M for PBL Material, Raising Concerns Over Lack of Competition
Contract Overview
Contract Amount: $19,772,532 ($19.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2023-10-05
End Date: 2025-06-30
Contract Duration: 634 days
Daily Burn Rate: $31.2K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 8510190992!PBL MATERIAL BOEING
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $19.8 million to THE BOEING COMPANY for work described as: 8510190992!PBL MATERIAL BOEING Key points: 1. Significant award to a single large contractor, Boeing. 2. Focus on aircraft manufacturing materials suggests critical defense supply chain role. 3. Lack of competition is a primary risk factor. 4. The sector is dominated by a few large aerospace firms.
Value Assessment
Rating: questionable
The award amount of $19.7M for PBL material is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to potential alternatives or if it reflects premium pricing due to the sole-source nature.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to offer the best price.
Taxpayer Impact: The lack of competition means taxpayers may be paying more than necessary for these essential aircraft manufacturing materials.
Public Impact
Potential for inflated costs due to non-competitive award. Impacts readiness if critical materials are over-priced. Highlights reliance on a single major defense contractor.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- Potential for cost overruns
- Reliance on a single supplier
Positive Signals
- Essential materials for defense
- Long-term contract duration
Sector Analysis
This award falls within the Aircraft Manufacturing sector, which is characterized by high barriers to entry and a limited number of major players. Spending in this area is critical for national defense capabilities.
Small Business Impact
The awardee is The Boeing Company, a major aerospace corporation. There is no indication that small businesses were involved in this specific contract, either as prime contractors or significant subcontractors.
Oversight & Accountability
The sole-source nature of this award warrants close oversight by the Defense Logistics Agency to ensure the pricing remains reasonable throughout the contract period and that performance meets all requirements.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award lacks competitive pricing.
- Potential for cost overruns due to lack of market pressure.
- High dependency on a single large contractor.
- Limited transparency in price justification.
- Risk of supply chain disruption.
Tags
aircraft-manufacturing, department-of-defense, mo, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $19.8 million to THE BOEING COMPANY. 8510190992!PBL MATERIAL BOEING
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 Logistics Agency).
What is the total obligated amount?
The obligated amount is $19.8 million.
What is the period of performance?
Start: 2023-10-05. End: 2025-06-30.
What is the justification for awarding this contract on a sole-source basis, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. The Defense Logistics Agency should have documented this justification. To ensure fair pricing, they should conduct robust price analyses, benchmark against historical data, and potentially negotiate specific cost elements aggressively.
What are the risks associated with relying solely on Boeing for these critical PBL materials, especially regarding supply chain disruptions?
Sole reliance on Boeing for critical PBL materials poses significant supply chain risks. Disruptions due to manufacturing issues, geopolitical events, or other unforeseen circumstances could severely impact aircraft availability and readiness. Diversification of suppliers or robust contingency planning by the DoD would mitigate these risks.
How does the fixed price contract structure mitigate or exacerbate the risks associated with this sole-source award?
A firm fixed-price contract shifts most of the cost risk to the contractor (Boeing). While this can protect the government from cost overruns if Boeing manages its expenses well, it doesn't inherently guarantee a fair price in a sole-source scenario. If Boeing's costs are higher than a competitive market would dictate, the government still pays that higher price.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JAMES S 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: $19,772,532
Exercised Options: $19,772,532
Current Obligation: $19,772,532
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SPRPA121D9001
IDV Type: IDC
Timeline
Start Date: 2023-10-05
Current End Date: 2025-06-30
Potential End Date: 2025-06-30 00:00:00
Last Modified: 2024-12-09
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