DoD Awards $37.2M for F-108 Engine Repair, Raising Questions on Value and Competition

Contract Overview

Contract Amount: $37,230,211 ($37.2M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 2022-04-28

End Date: 2025-09-30

Contract Duration: 1,251 days

Daily Burn Rate: $29.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: F-108 CONTRACT REPAIR AUGMENTATION

Plain-Language Summary

Department of Defense obligated $37.2 million to CANADIAN COMMERCIAL CORPORATION for work described as: F-108 CONTRACT REPAIR AUGMENTATION Key points: 1. The contract's significant value of $37.2M warrants scrutiny for cost-effectiveness. 2. Competition method is 'Full and Open,' but the specific award mechanism needs review. 3. Potential risks include contract duration and the absence of small business participation. 4. The sector is Aircraft Engine and Engine Parts Manufacturing, a critical defense area.

Value Assessment

Rating: questionable

The contract value of $37.2M for engine repair over 1251 days appears high. Benchmarking against similar repair contracts for the F-108 engine or comparable aircraft engines is crucial to determine if this pricing is competitive and represents good value for taxpayer dollars.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition,' which is positive for price discovery. However, the award type is a 'Delivery Order,' suggesting it might be part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract, the specifics of which are not detailed here and could impact true competition.

Taxpayer Impact: The substantial $37.2M expenditure necessitates careful oversight to ensure it is justified and that taxpayers are not overpaying for essential aircraft engine repair services.

Public Impact

Military readiness could be impacted if engine repair costs are inflated, diverting funds from other critical needs. The lack of small business involvement may limit opportunities for specialized repair providers and potentially reduce competitive pricing. Transparency in the bidding process and award justification is essential for public trust in defense spending.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

No small business participation
Long contract duration (1251 days)
Potential for cost overruns in fixed-price contracts for complex repairs

Positive Signals

Full and open competition method
Critical defense asset repair

Sector Analysis

This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector, a highly specialized and critical area for national defense. Spending benchmarks in this sector are often high due to the complexity and proprietary nature of engine components and repair processes.

Small Business Impact

The absence of small business participation (ss: false) is a notable concern. This suggests that opportunities for smaller, potentially more agile or specialized firms were not pursued or were unable to compete, which could limit innovation and competitive pricing.

Oversight & Accountability

While awarded under full and open competition, the specific oversight mechanisms for this delivery order are not detailed. Ensuring robust monitoring of performance, quality, and cost adherence throughout the contract's duration is vital for accountability.

Related Government Programs

Aircraft Engine and Engine Parts Manufacturing
Department of Defense Contracting
Defense Logistics Agency Programs

Risk Flags

High contract value
Long contract duration
No small business participation
Potential lack of detailed cost breakdown
Dependency on a single supplier for critical repairs (if IDIQ is limited)

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.2 million to CANADIAN COMMERCIAL CORPORATION. F-108 CONTRACT REPAIR AUGMENTATION

Who is the contractor on this award?

The obligated recipient is CANADIAN COMMERCIAL CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $37.2 million.

What is the period of performance?

Start: 2022-04-28. End: 2025-09-30.

What is the benchmark cost for F-108 engine repair, and how does this contract's pricing compare?

A thorough benchmark analysis against historical F-108 repair contracts and comparable engine repair services is needed. Without this data, it's difficult to ascertain if the $37.2M award represents a fair and reasonable price. Factors like the scope of work, parts required, and labor rates must be considered in any comparison to ensure value for taxpayer money.

What specific factors led to the 'Full and Open Competition' designation, and were there any limitations on bidders?

The 'Full and Open Competition' designation implies that all responsible sources were permitted to submit offers. However, the nature of the 'Delivery Order' award suggests it might be against a pre-existing IDIQ contract. Further investigation into the original IDIQ's competition strategy and any specific requirements or restrictions for this particular order is necessary to fully understand the competitive landscape.

How does the 1251-day contract duration impact the risk of cost escalation and the ability to adapt to technological advancements?

A long duration like 1251 days increases the risk of cost escalation, especially with a firm-fixed-price contract if unforeseen issues arise. It also poses a risk of obsolescence or the need for upgrades during the contract period. Mitigation strategies, such as clear escalation clauses or phased reviews for technological relevance, should be in place to manage these long-term risks effectively.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing

Product/Service Code: ENGINES AND TURBINES AND COMPONENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 350 ALBERT ST SUITE 700, OTTAWA

Business Categories: Category Business, Foreign Government, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $37,230,211

Exercised Options: $37,230,211

Current Obligation: $37,230,211

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPE4AX20D9004

IDV Type: IDC

Timeline