DoD awards $24.1M for TF33 engine component parts to RTX Corporation, citing sole-source justification

Contract Overview

Contract Amount: $24,132,918 ($24.1M)

Contractor: RTX Corporation

Awarding Agency: Department of Defense

Start Date: 2020-09-22

End Date: 2025-09-05

Contract Duration: 1,809 days

Daily Burn Rate: $13.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIXED PRICE REDETERMINATION

Sector: Defense

Official Description: NEW MANUFACTURE OF COMPONENT PARTS FOR THE TF33 AIRCRAFT ENGINE.

Place of Performance

Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06118

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $24.1 million to RTX CORPORATION for work described as: NEW MANUFACTURE OF COMPONENT PARTS FOR THE TF33 AIRCRAFT ENGINE. Key points: 1. Contract awarded to a single, established manufacturer, raising questions about competitive pricing. 2. Long-term contract duration (over 5 years) suggests a need for sustained component supply. 3. Fixed Price Redetermination contract type introduces potential for cost fluctuations. 4. No small business set-aside indicates a focus on specialized manufacturing capabilities. 5. High value suggests critical components for a significant defense platform.

Value Assessment

Rating: fair

The contract value of $24.1 million for component parts for the TF33 aircraft engine appears substantial. Without specific details on the quantity and nature of the components, a direct value-for-money assessment is challenging. However, the sole-source nature of the award means there was no direct price competition to benchmark against. The Fixed Price Redetermination (FPR) contract type suggests that initial pricing is an estimate, subject to adjustment based on actual costs incurred by the contractor, which can introduce risk for the government if not managed closely.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, RTX Corporation, was solicited. The justification for sole-sourcing is not provided in the data, but it typically implies that only one responsible source is capable of making the required supplies or performing the services. This lack of competition limits the government's ability to explore alternative pricing and potentially discover lower costs through a competitive bidding process.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as there is no competitive pressure on the contractor to offer the most cost-effective solution.

Public Impact

The primary beneficiaries are the Department of Defense and potentially military personnel relying on TF33-powered aircraft. Services delivered include the manufacture of essential component parts for a specific aircraft engine. Geographic impact is likely concentrated around RTX Corporation's manufacturing facilities, primarily in Connecticut. Workforce implications include job retention and potential expansion within RTX's manufacturing sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Fixed Price Redetermination contract type carries inherent cost uncertainty.
Lack of small business involvement may limit opportunities for smaller specialized manufacturers.

Positive Signals

Award to RTX Corporation, a known defense contractor, suggests access to established expertise and supply chains.
Long contract duration indicates a stable supply of critical components for an extended period.
Focus on component parts for a specific engine implies specialized manufacturing capabilities are being utilized.

Sector Analysis

The TF33 engine is a turbofan engine used in various military aircraft, including some strategic bombers and reconnaissance platforms. The market for specialized aircraft engine components is typically dominated by a few large, established aerospace manufacturers due to the high barriers to entry, including complex engineering, stringent quality control, and significant capital investment. RTX Corporation (formerly Raytheon Technologies) is a major player in this sector. Spending in this area is critical for maintaining the operational readiness of aging but still vital military assets.

Small Business Impact

This contract does not appear to have a small business set-aside, as indicated by 'sb: false'. Given the nature of manufacturing specialized aircraft engine components, it is likely that the prime contractor, RTX Corporation, possesses unique capabilities or existing infrastructure that makes it the sole viable option. There is no information provided on subcontracting plans, but large sole-source contracts often have provisions for small business participation, though it is not guaranteed.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and procurement regulations, managed by the Defense Logistics Agency. The Fixed Price Redetermination (FPR) contract type necessitates close monitoring of the contractor's cost accounting and performance to ensure fair pricing adjustments. Inspector General (IG) oversight is likely, particularly concerning cost claims and performance metrics. Transparency may be limited due to the sole-source nature and proprietary manufacturing processes.

Related Government Programs

TF33 Engine Maintenance and Repair
Aircraft Component Manufacturing
Defense Logistics Agency Procurement
RTX Corporation Defense Contracts

Risk Flags

Sole-source award may limit cost savings.
FPR contract type requires diligent cost monitoring.
Dependency on a single supplier for critical components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.1 million to RTX CORPORATION. NEW MANUFACTURE OF COMPONENT PARTS FOR THE TF33 AIRCRAFT ENGINE.

Who is the contractor on this award?

The obligated recipient is RTX CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $24.1 million.

What is the period of performance?

Start: 2020-09-22. End: 2025-09-05.

What is the specific justification provided by the Defense Logistics Agency for awarding this contract on a sole-source basis to RTX Corporation?

The provided data indicates the contract was 'NOT COMPETED' and is 'sole-source'. While the specific justification is not detailed, common reasons for sole-source awards in defense contracting include the unique capability of a single contractor, urgent and compelling needs where competition is not feasible, or when the item is a follow-on to a previously competed contract where only one source can provide the necessary compatibility. For the TF33 engine components, it's plausible that RTX Corporation holds the intellectual property, specialized tooling, or manufacturing expertise essential for these specific parts, making them the only viable source.

How does the Fixed Price Redetermination (FPR) contract type typically function, and what are the potential risks and benefits for the government?

A Fixed Price Redetermination (FPR) contract establishes an initial price that is subject to adjustment based on the contractor's actual costs incurred and a pre-negotiated profit margin. The government benefits by potentially securing a lower price if the contractor's costs are lower than anticipated. However, the primary risk lies in the potential for cost overruns. The government must have robust cost accounting surveillance to ensure the redetermined price accurately reflects legitimate costs and is not inflated. This requires significant oversight effort to verify the contractor's expenses and profit calculations.

What is the historical spending pattern for TF33 aircraft engine component parts, and how does this $24.1 million award compare?

Without access to historical spending data specifically for TF33 engine component parts, a direct comparison is difficult. However, the $24.1 million award over approximately five years suggests a consistent, albeit not massive, annual expenditure. If this represents a significant portion of the total lifecycle cost for maintaining the TF33 engine fleet, it indicates a substantial investment. Examining past contracts for similar components or engine overhauls could provide context, but the current data point suggests a sustained need for these parts, likely for an operational fleet of aircraft.

What are the implications of RTX Corporation being the sole awardee for the long-term supply of these critical engine components?

The long-term supply of critical engine components by a single entity, RTX Corporation, has several implications. Positively, it ensures supply chain stability and leverages RTX's established expertise with the TF33 engine. Negatively, it creates a dependency on RTX, potentially reducing the government's leverage in future negotiations. It also means that any disruptions at RTX (e.g., labor issues, supply chain problems, financial difficulties) could directly impact the availability of these vital parts, potentially grounding aircraft. Continuous performance monitoring and strong contract management are crucial.

Are there any known performance issues or track record concerns associated with RTX Corporation regarding similar defense manufacturing contracts?

RTX Corporation, through its various legacy companies (Pratt & Whitney, Collins Aerospace, Raytheon Missiles & Defense), has a long and extensive track record in defense manufacturing, including engine components. While specific performance issues on individual contracts can arise for any large contractor, RTX is generally considered a reliable supplier of complex aerospace and defense systems. Without specific data on past performance related to TF33 components, it's reasonable to assume the award was based on their established capabilities. However, ongoing performance monitoring throughout this contract's duration remains essential.

Industry Classification

NAICS: Manufacturing › Hardware Manufacturing › Hardware Manufacturing

Product/Service Code: ENGINES AND TURBINES AND COMPONENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIXED PRICE REDETERMINATION (A)

Evaluated Preference: NONE

Contractor Details

Parent Company: Rockwell Collins Australia PTY Limited

Address: 400 MAIN ST, EAST HARTFORD, CT, 06118

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: $24,132,918

Exercised Options: $24,132,918

Current Obligation: $24,132,918

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: SPE4AX20DR001

IDV Type: IDC

Timeline