DoD awards $50M+ for rotor blades, with Sikorsky Aircraft Corporation as sole source

Contract Overview

Contract Amount: $50,166,431 ($50.2M)

Contractor: Sikorsky Aircraft Corporation

Awarding Agency: Department of Defense

Start Date: 2023-04-17

End Date: 2025-08-10

Contract Duration: 846 days

Daily Burn Rate: $59.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MAIN, ROTOR BLADE

Place of Performance

Location: STRATFORD, FAIRFIELD County, CONNECTICUT, 06614

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $50.2 million to SIKORSKY AIRCRAFT CORPORATION for work described as: MAIN, ROTOR BLADE Key points: 1. Significant investment in critical aircraft components highlights ongoing defense needs. 2. Sole-source award raises questions about potential price inflation and limited market exploration. 3. Long contract duration suggests a sustained requirement for these specialized parts. 4. The absence of competition may limit opportunities for innovation and cost reduction. 5. Focus on a single supplier could create supply chain vulnerabilities. 6. Contract value indicates a substantial portion of the agency's budget allocated to this specific need.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the sole-source nature, which inherently limits direct price comparisons. The contract value of over $50 million for rotor blades suggests a high unit cost, but without competitive bids or publicly available cost breakdowns, it's difficult to definitively assess if this represents fair market value. The fixed-price structure offers some cost certainty, but the lack of competition means the government may not be benefiting from the most economical pricing achievable in a more open market.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Sikorsky Aircraft Corporation, was considered. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source awards can be justified in specific circumstances, such as when only one vendor possesses the necessary proprietary technology or capability, it significantly reduces the opportunity for price discovery and potentially leads to higher costs for the government.

Taxpayer Impact: Taxpayers may be paying a premium for these rotor blades due to the lack of competitive pressure. Without multiple bids, there is less incentive for the contractor to offer the lowest possible price, potentially leading to inefficient use of public funds.

Public Impact

The primary beneficiaries are the Department of Defense, ensuring operational readiness of aircraft equipped with these rotor blades. Services delivered include the manufacturing and supply of critical rotor blade components essential for helicopter and other rotorcraft operations. The geographic impact is primarily within the United States, supporting defense manufacturing and supply chains. Workforce implications include sustained employment for skilled manufacturing personnel at Sikorsky Aircraft Corporation and its suppliers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings.
Lack of competition may reduce pressure for innovation in rotor blade technology.
Dependence on a single supplier could pose supply chain risks.
Contract duration of over two years may not reflect current market efficiencies.

Positive Signals

Ensures supply of critical, potentially specialized, rotor blade components.
Fixed-price contract provides cost predictability for the awarded amount.
Sikorsky Aircraft Corporation is a known entity with established defense manufacturing capabilities.

Sector Analysis

The aerospace manufacturing sector, particularly for defense applications, is characterized by high barriers to entry, significant R&D investment, and often long production cycles. This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' industry code (NAICS 336413). The market for specialized rotor blades is often concentrated among a few key players due to stringent performance and safety requirements. Spending in this sub-sector is directly tied to military readiness and modernization programs.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The sole-source nature further limits opportunities for small businesses to participate directly. While Sikorsky Aircraft Corporation may engage small businesses as suppliers, the primary award does not reflect a direct effort to boost small business participation in federal contracting.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA) and the Defense Contract Audit Agency (DCAA), responsible for ensuring compliance with contract terms, quality standards, and financial accountability. The Defense Logistics Agency (DLA) as the contracting agency also maintains oversight. Transparency is limited by the sole-source nature, but contract modifications and performance reports would be subject to internal review and potentially Inspector General audits if specific concerns arise.

Related Government Programs

Department of Defense Aircraft Procurement
Defense Logistics Agency Aviation Support
Helicopter Component Manufacturing
Aerospace Parts Supply Chain

Risk Flags

Sole-source award lacks competitive pricing.
Potential for supply chain disruption if single supplier faces issues.
Limited transparency into cost structure due to non-competitive nature.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $50.2 million to SIKORSKY AIRCRAFT CORPORATION. MAIN, ROTOR BLADE

Who is the contractor on this award?

The obligated recipient is SIKORSKY AIRCRAFT CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $50.2 million.

What is the period of performance?

Start: 2023-04-17. End: 2025-08-10.

What is the historical spending pattern for rotor blades by the Defense Logistics Agency?

Analyzing historical spending patterns for rotor blades by the Defense Logistics Agency (DLA) requires access to detailed procurement databases. However, general trends indicate consistent investment in aircraft components to maintain fleet readiness. Sole-source awards like this one, especially for specialized parts, suggest that the DLA may have limited options for competitive procurement due to the proprietary nature of the technology or the limited number of qualified manufacturers. Over time, the total expenditure on rotor blades would likely correlate with the operational tempo and modernization efforts of the U.S. military's rotorcraft fleet. Without specific historical data for this exact part number or category, it's difficult to provide precise figures, but the consistent need for aircraft maintenance and upgrades implies ongoing, substantial spending in this area.

What are the specific performance requirements for these rotor blades?

The provided data does not detail the specific performance requirements for these rotor blades. However, for defense applications, rotor blades are critical components subject to rigorous engineering and safety standards. These typically include requirements related to aerodynamic efficiency, structural integrity under extreme stress (including high G-forces and varying temperatures), fatigue life, resistance to environmental factors (like sand, ice, and corrosion), and compatibility with specific aircraft models and systems. Manufacturers must adhere to strict military specifications (Mil-Specs) and often undergo extensive testing and certification processes to ensure reliability and safety in demanding operational environments. The sole-source nature of this award might imply that Sikorsky Aircraft Corporation holds specific patents or unique manufacturing processes that meet these exacting requirements.

How does the fixed-price contract type mitigate risk for the government?

The Firm Fixed Price (FFP) contract type offers significant risk mitigation for the government regarding cost overruns. Under an FFP agreement, the contractor, Sikorsky Aircraft Corporation, assumes the primary responsibility for all costs incurred to complete the work. The price is set at the outset and generally does not change, regardless of the contractor's actual costs. This provides budget certainty for the Defense Logistics Agency (DLA). While the government benefits from predictable spending, the contractor bears the risk of cost increases, potentially leading them to build in higher profit margins or contingency reserves to account for unforeseen issues. This can sometimes result in a higher initial price compared to cost-reimbursement contracts, but it protects the government from unexpected escalations.

What is Sikorsky Aircraft Corporation's track record with the Defense Logistics Agency?

Sikorsky Aircraft Corporation, a subsidiary of Lockheed Martin, has a long-standing and extensive track record as a major supplier of helicopters and related components to the U.S. military, including the Department of Defense (DoD) and its agencies like the Defense Logistics Agency (DLA). They are known for producing iconic military rotorcraft such as the Black Hawk and Seahawk families. Their history with the DLA likely involves numerous contracts for spare parts, maintenance, and potentially new aircraft. Given their established position and specialized expertise in rotorcraft technology, it is common for them to be awarded sole-source contracts for critical components like rotor blades, especially when specific designs or technologies are proprietary or require unique manufacturing capabilities that only they possess.

Are there alternative suppliers for these specific rotor blades?

The data indicates this contract was awarded on a sole-source basis, suggesting that for this specific requirement, the Defense Logistics Agency (DLA) determined that Sikorsky Aircraft Corporation was the only responsible source capable of providing the necessary rotor blades. This could be due to proprietary technology, unique design specifications, existing integration with specific aircraft platforms, or specialized manufacturing processes held exclusively by Sikorsky. While other companies manufacture rotor blades, they may not produce the exact specifications required for the particular aircraft models supported by this contract, or they may not have undergone the necessary military qualification and certification processes. Therefore, while alternatives might exist in the broader market, they may not be viable or suitable for this specific defense procurement.

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

Parent Company: Lockheed Martin Corp

Address: 6900 MAIN ST, STRATFORD, CT, 06614

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

Financial Breakdown

Contract Ceiling: $50,166,431

Exercised Options: $50,166,431

Current Obligation: $50,166,431

Actual Outlays: $8,578,646

Subaward Activity

Number of Subawards: 15

Total Subaward Amount: $25,367,639

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: SPE4AX15D9423

IDV Type: IDC

Timeline