DoD awards $32.15M for KC-135 Ruddevator/Boom Manufacturing to Boeing, a sole-source contract
Contract Overview
Contract Amount: $32,153,250 ($32.2M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2024-03-15
End Date: 2027-11-30
Contract Duration: 1,355 days
Daily Burn Rate: $23.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MANUFACTURE OF RUDDEVATOR, BOOM FOR THE KC-135 AIRCRAFT.
Plain-Language Summary
Department of Defense obligated $32.2 million to THE BOEING COMPANY for work described as: MANUFACTURE OF RUDDEVATOR, BOOM FOR THE KC-135 AIRCRAFT. Key points: 1. Significant contract for critical aircraft components. 2. Sole-source award to incumbent, raising competition concerns. 3. Long-term contract duration may impact price flexibility. 4. Focus on sustainment of aging aircraft fleet.
Value Assessment
Rating: fair
The award amount of $32.15M for a multi-year delivery order appears reasonable for specialized aircraft parts. However, without competitive bidding, it's difficult to definitively assess value against market alternatives.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This limits price discovery and potentially leads to higher costs compared to a competitive environment.
Taxpayer Impact: Taxpayer funds are committed without the benefit of competitive pricing, potentially increasing the overall cost of maintaining the KC-135 fleet.
Public Impact
Ensures continued operational readiness of the KC-135 Stratotanker fleet. Supports critical maintenance and repair capabilities for aging aircraft. Potential for increased costs due to lack of competition.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of competition
Positive Signals
- Ensures availability of critical parts
- Supports existing platform
Sector Analysis
This contract falls within the aerospace manufacturing sector, specifically focusing on aircraft parts. Spending in this area is driven by military readiness requirements and the sustainment of aging aircraft fleets.
Small Business Impact
The awardee is The Boeing Company, a large aerospace manufacturer. There is no indication that small businesses were involved in this specific contract, either as prime contractors or significant subcontractors.
Oversight & Accountability
The Department of Defense, through the Defense Logistics Agency, is responsible for this award. Oversight should focus on ensuring fair pricing and performance throughout the contract's duration, especially given the sole-source nature.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award limits price competition.
- Long contract duration may not reflect current market conditions.
- Potential for cost creep without competitive oversight.
- Reliance on a single supplier for critical components.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $32.2 million to THE BOEING COMPANY. MANUFACTURE OF RUDDEVATOR, BOOM FOR THE KC-135 AIRCRAFT.
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 $32.2 million.
What is the period of performance?
Start: 2024-03-15. End: 2027-11-30.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves factors like unique capabilities, proprietary technology, or the need for compatibility with existing systems. For this contract, the need to maintain the KC-135 fleet likely drove the decision. However, a thorough review should confirm that no viable competitive alternatives were overlooked and that the sole-source justification is robust and documented.
How does the pricing structure compare to historical data or industry benchmarks for similar aircraft components?
Without competitive bids, direct comparison is challenging. Analysis should involve reviewing historical pricing for similar components, Boeing's pricing on other sole-source contracts for comparable parts, and industry benchmarks for aircraft manufacturing and sustainment. Any significant deviations from these benchmarks should be investigated to ensure fair pricing.
What are the potential risks associated with the long contract duration and the sole-source nature of this award?
The primary risks include potential cost overruns due to a lack of competitive pressure, reduced incentive for Boeing to innovate or improve efficiency, and the possibility of the government being locked into unfavorable terms. Additionally, long-term reliance on a single supplier can create supply chain vulnerabilities if that supplier faces production issues or financial instability.
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
Solicitation ID: SPRTA122R0136
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JS 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: $32,153,250
Exercised Options: $32,153,250
Current Obligation: $32,153,250
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $21,657,000
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: SPE4A119G0013
IDV Type: BOA
Timeline
Start Date: 2024-03-15
Current End Date: 2027-11-30
Potential End Date: 2027-11-30 00:00:00
Last Modified: 2024-03-15
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