DoD's $120M Bell Boeing Contract for PBL Material Raises Concerns Over Competition and Value
Contract Overview
Contract Amount: $120,061,321 ($120.1M)
Contractor: Bell Boeing Joint Project Office
Awarding Agency: Department of Defense
Start Date: 2024-11-26
End Date: 2025-11-30
Contract Duration: 369 days
Daily Burn Rate: $325.4K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 8511022552!PBL MATERIAL BELL BOEING
Place of Performance
Location: AMARILLO, POTTER County, TEXAS, 79111
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $120.1 million to BELL BOEING JOINT PROJECT OFFICE for work described as: 8511022552!PBL MATERIAL BELL BOEING Key points: 1. Significant contract value of $120M for aircraft parts. 2. Lack of competition is a major concern, potentially inflating costs. 3. The 'Other Aircraft Parts' sector is broad, making direct benchmarks difficult. 4. Potential for taxpayer funds to be misallocated due to limited price discovery.
Value Assessment
Rating: questionable
The contract's firm fixed price structure is standard, but without competitive bidding, it's difficult to assess if the $120M price represents fair market value. Benchmarking against similar sole-source contracts in the defense sector is challenging due to unique specifications.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and negotiation leverage, potentially leading to higher costs for the government compared to a competitive environment.
Taxpayer Impact: The lack of competition means taxpayers may be paying a premium for these PBL materials, as the government did not benefit from multiple bids to drive down the price.
Public Impact
Taxpayers may be overpaying for essential aircraft parts due to the absence of competitive bidding. The Department of Defense relies on this sole-source provider, creating a potential dependency. Transparency in pricing and justification for the sole-source award is crucial for public trust.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for inflated pricing
- Limited transparency on cost justification
Positive Signals
- Firm fixed price contract type
- Long-term contract duration (369 days)
Sector Analysis
This contract falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector. Spending in defense aerospace manufacturing can be substantial, but sole-source awards like this can obscure true market value and efficiency benchmarks.
Small Business Impact
There is no indication that small businesses were involved in this specific contract award. The focus appears to be on a large, established joint venture, potentially bypassing opportunities for smaller suppliers.
Oversight & Accountability
Oversight is critical for sole-source contracts to ensure fair pricing and prevent waste. The Defense Logistics Agency should provide detailed justification for the non-competitive award and conduct thorough cost analyses.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award lacks competitive pricing.
- Potential for cost overruns due to limited price discovery.
- Lack of transparency in cost justification.
- Dependency on a single supplier.
- Limited opportunity for small business participation.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, tx, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $120.1 million to BELL BOEING JOINT PROJECT OFFICE. 8511022552!PBL MATERIAL BELL BOEING
Who is the contractor on this award?
The obligated recipient is BELL BOEING JOINT PROJECT OFFICE.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $120.1 million.
What is the period of performance?
Start: 2024-11-26. End: 2025-11-30.
What is the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure the price is fair and reasonable?
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 agency should have conducted a thorough price analysis, potentially using historical data, cost breakdowns from the contractor, or comparisons to similar, albeit non-identical, sole-source procurements to establish reasonableness.
How does the $120M price compare to industry benchmarks for similar aircraft parts, considering the sole-source nature of this contract?
Direct comparison to industry benchmarks is difficult for sole-source contracts, especially for specialized defense components. While the firm fixed price aims for cost certainty, the absence of competition means the price might exceed what could be achieved through bidding. The government likely relied on internal cost estimates or contractor-provided data, which may not reflect the most competitive market rate.
What is the potential impact on readiness and future procurement costs if the government becomes overly reliant on sole-source suppliers for critical aircraft parts?
Over-reliance on sole-source suppliers can stifle innovation, reduce competition, and lead to escalating costs over time as the contractor faces less pressure to improve efficiency or offer competitive pricing. This dependency can also create vulnerabilities in the supply chain and potentially impact military readiness if the sole source faces production issues or price hikes.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 401 TILTROTOR DR PLANT A, AMARILLO, TX, 79111
Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $120,061,321
Exercised Options: $120,061,321
Current Obligation: $120,061,321
Subaward Activity
Number of Subawards: 60
Total Subaward Amount: $15,397,568
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPE4AX20D9001
IDV Type: IDC
Timeline
Start Date: 2024-11-26
Current End Date: 2025-11-30
Potential End Date: 2025-11-30 00:00:00
Last Modified: 2025-03-28
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