DoD awards $81M for J85 engine rotor and compressor support to General Electric
Contract Overview
Contract Amount: $81,222,964 ($81.2M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2024-09-30
End Date: 2029-12-31
Contract Duration: 1,918 days
Daily Burn Rate: $42.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: ROTOR, COMPRESSOR IN SUPPORT OF THE J85 ENGINE.
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $81.2 million to GENERAL ELECTRIC COMPANY for work described as: ROTOR, COMPRESSOR IN SUPPORT OF THE J85 ENGINE. Key points: 1. Contract awarded on a sole-source basis, raising questions about potential price overruns. 2. Significant duration of the contract (over 5 years) suggests a long-term need for these critical engine components. 3. The contract is for sustainment, indicating a focus on maintaining existing military readiness rather than new development. 4. High value suggests these components are essential for a substantial portion of the J85 engine fleet. 5. Lack of competition limits opportunities for cost savings through market forces. 6. The contract's fixed-price nature provides some cost certainty, but the absence of competition hinders true value assessment.
Value Assessment
Rating: questionable
Benchmarking the value of this contract is challenging due to its sole-source nature and the specialized components involved. Without competitive bids, it's difficult to ascertain if the $81.2 million represents a fair market price. The contract's duration and the critical nature of engine parts suggest a high baseline cost, but the lack of comparison data prevents a definitive value-for-money assessment. The provided benchmark data (br: 42348) is too abstract to be directly comparable without further context on unit volume or specific part numbers.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one bidder, General Electric Company, was considered. This typically occurs when a single entity possesses unique capabilities, intellectual property, or is the sole manufacturer of the required item. The lack of competition means there was no opportunity for price discovery through a bidding process, potentially leading to higher costs for the government.
Taxpayer Impact: Taxpayers may be paying a premium for these critical engine components due to the absence of competitive pressure. Without multiple bids, the government cannot be assured it is receiving the best possible price.
Public Impact
The primary beneficiaries are the Department of Defense and its aviation units relying on aircraft powered by the J85 engine. Services delivered include the provision of essential rotor and compressor components, crucial for engine functionality and aircraft readiness. The geographic impact is likely widespread, supporting military operations across various bases and deployment locations. Workforce implications may include continued employment for specialized manufacturing and maintenance personnel at General Electric.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition and potential cost savings.
- Long contract duration could lock in potentially inflated prices over time.
- Lack of transparency in the sole-source justification makes independent value assessment difficult.
Positive Signals
- Award to a known, established manufacturer (General Electric) suggests reliability and expertise.
- Firm Fixed Price contract provides cost predictability for the government.
- Contract supports critical sustainment needs for existing military assets.
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft engine components. The market for such specialized parts is often dominated by a few key original equipment manufacturers (OEMs) like General Electric, due to proprietary technology and extensive testing requirements. Spending in this area is critical for maintaining the operational readiness of military fleets, and contracts are often long-term to ensure supply chain stability for aging aircraft.
Small Business Impact
This contract does not appear to include a small business set-aside. Given the sole-source nature and the specialized manufacturing requirements for aircraft engine components, it is unlikely that small businesses would be primary awardees. However, General Electric may engage small businesses as subcontractors for certain parts or services, though this is not explicitly detailed in the provided data.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Defense's contracting and procurement regulations. The Defense Contract Management Agency (DCMA) would likely be involved in monitoring performance and compliance. Transparency is limited due to the sole-source award, but contract modifications and performance reports would be subject to internal DoD review and potentially Inspector General audits if performance issues arise.
Related Government Programs
- J85 Engine Sustainment Programs
- Aircraft Engine Component Procurement
- Defense Logistics Agency Supply Chain Management
- Military Aircraft Readiness Initiatives
Risk Flags
- Sole-source award
- Long-term contract duration
- Specialized aerospace components
Tags
defense, department-of-defense, general-electric, j85-engine, aircraft-manufacturing, sole-source, sustainment, rotor-compressor, firm-fixed-price, defense-logistics-agency, massachusetts, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $81.2 million to GENERAL ELECTRIC COMPANY. ROTOR, COMPRESSOR IN SUPPORT OF THE J85 ENGINE.
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $81.2 million.
What is the period of performance?
Start: 2024-09-30. End: 2029-12-31.
What is the historical spending pattern for J85 engine components from General Electric?
Analyzing historical spending for J85 engine components from General Electric requires access to historical contract data beyond this single award. Typically, sustainment contracts for major engine platforms are awarded over extended periods, often through multiple contract vehicles and delivery orders. Without specific historical data, it's difficult to establish a trend. However, it's common for such components to see consistent, significant investment to maintain fleet readiness, especially for widely used engines like the J85 which powers numerous trainer and light attack aircraft. The current $81.2 million award over approximately five years suggests an average annual spend of roughly $16 million, which would need to be compared against previous years' expenditures to identify any significant deviations or patterns.
What specific J85 engine models or aircraft platforms does this contract support?
The provided data indicates the contract supports the J85 engine, but does not specify the exact models or the aircraft platforms that utilize it. The J85 is a versatile engine used in a variety of military aircraft, including trainers like the T-37 Tweet and T-1 Jayhawk, light attack aircraft such as the A-37 Dragonfly, and reconnaissance aircraft like the OV-1 Mohawk. The specific rotor and compressor components procured would depend on the particular engine variants and the fleet size of the supported aircraft. Understanding the specific platforms would provide better context for the scale of the requirement and the criticality of these components to ongoing military operations.
What is the justification for the sole-source award, and what alternatives were considered?
The justification for a sole-source award typically stems from reasons such as unique capabilities, proprietary technology, or the absence of other responsible sources. For aircraft engine components, this often relates to the original equipment manufacturer (OEM) holding the necessary design data, manufacturing processes, and intellectual property rights. General Electric, as the likely OEM for the J85 engine, would possess these exclusive rights. Alternatives considered in a sole-source scenario usually involve assessing whether any other entity could realistically produce the required parts to the stringent military specifications, or if a competitive procurement could be structured without compromising technical requirements or incurring prohibitive non-recurring engineering costs. The specific justification document would detail these considerations.
What are the key performance metrics and delivery schedules associated with this contract?
The provided data specifies the contract's end date (2029-12-31) and duration (1918 days), indicating a long-term sustainment requirement. However, specific key performance metrics (KPIs) and detailed delivery schedules are not included. For sustainment contracts of this nature, common KPIs would likely include on-time delivery rates, component reliability and Mean Time Between Failures (MTBF), defect rates, and turnaround times for repairs or replacements. The delivery schedule would be managed through individual delivery orders issued against this contract, outlining quantities and required delivery dates for specific components to meet operational demands.
How does the $81.2 million contract value compare to the total lifecycle cost of the J85 engine program?
Estimating the total lifecycle cost of the J85 engine program and comparing this $81.2 million contract to it requires extensive data not provided. The J85 has been in service for decades, powering numerous aircraft across multiple branches of the military. Its lifecycle cost encompasses initial procurement, sustainment (including parts like those in this contract), maintenance, upgrades, and eventual retirement. This $81.2 million award represents a portion of the sustainment costs over its contract period. To assess its proportion of the total lifecycle cost, one would need to aggregate all sustainment spending over the engine's operational life, which could easily run into billions of dollars, making this contract a significant but not all-encompassing component.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: ENGINES AND TURBINES AND COMPONENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: SPRTA124R0089
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1000 WESTERN AVE, LYNN, MA, 01905
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: $81,222,964
Exercised Options: $81,222,964
Current Obligation: $81,222,964
Subaward Activity
Number of Subawards: 2
Total Subaward Amount: $583,071
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: SPE4A122G0010
IDV Type: BOA
Timeline
Start Date: 2024-09-30
Current End Date: 2029-12-31
Potential End Date: 2029-12-31 00:00:00
Last Modified: 2024-09-30
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