Department of Defense awards $11.2M contract for aircraft parts, raising questions about competition and value

Contract Overview

Contract Amount: $11,247,967 ($11.2M)

Contractor: RTX Corporation

Awarding Agency: Department of Defense

Start Date: 2025-09-25

End Date: 2028-12-01

Contract Duration: 1,163 days

Daily Burn Rate: $9.7K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: LINER AUGMENTOR 2840-01-443-4069NZ 4083170 86 EACH

Place of Performance

Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06118

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $11.2 million to RTX CORPORATION for work described as: LINER AUGMENTOR 2840-01-443-4069NZ 4083170 86 EACH Key points: 1. The contract was awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. The per-unit cost for the LINER AUGMENTOR is not benchmarked, making value assessment difficult. 3. The contractor, RTX CORPORATION, has a significant presence in the aerospace and defense sector. 4. The contract duration extends over four years, indicating a long-term need for these parts. 5. The award is a delivery order under a larger contract, suggesting a pre-existing relationship. 6. The absence of small business participation raises concerns about broader economic impact.

Value Assessment

Rating: questionable

The total award amount is $11,247,966.74 for 8,600 units. Without a competitive bidding process, it is difficult to ascertain if this represents a fair market price. Benchmarking against similar LINER AUGMENTOR contracts or components from other manufacturers would be necessary to provide a more definitive value assessment. The firm fixed-price nature of the contract shifts some risk to the contractor, but the lack of competition is a primary concern for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP) and was awarded as a sole-source action. This means that only one bidder, RTX CORPORATION, was solicited. The lack of competition limits the government's ability to explore alternative suppliers or negotiate more favorable terms, potentially leading to higher prices than if multiple bids were considered.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure, as the government did not benefit from the price discovery mechanisms inherent in a multi-bidder scenario.

Public Impact

The primary beneficiaries are the Department of Defense and potentially military personnel who rely on the aircraft utilizing these LINER AUGMENTORS. The contract delivers essential aircraft parts, contributing to the operational readiness and maintenance of military aviation assets. The geographic impact is primarily within the Department of Defense's operational theaters, supporting global military missions. Workforce implications are likely concentrated within RTX CORPORATION's manufacturing and supply chain operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and potentially inflates costs.
Lack of per-unit cost benchmarking hinders value-for-money assessment.
No indication of small business participation or subcontracting plans.
Long contract duration without competitive re-evaluation could lead to sustained higher costs.

Positive Signals

Firm fixed-price contract shifts some cost risk to the contractor.
RTX CORPORATION is a known entity in the defense sector, suggesting some level of established capability.
Delivery order structure implies it's part of a larger, potentially established program.

Sector Analysis

This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector, a critical component of the broader aerospace and defense industry. This industry is characterized by high technological barriers to entry, significant R&D investment, and long product lifecycles. Spending in this sector is heavily influenced by defense budgets and geopolitical factors. Comparable spending benchmarks are difficult to establish without more specific part details, but the overall defense procurement of aircraft components represents billions annually.

Small Business Impact

The contract details indicate that small business participation was not a factor in this award (ss: false, sb: false). There is no mention of small business set-asides or subcontracting plans. This suggests that the prime contractor, RTX CORPORATION, will likely perform the work internally or with large business partners. This could limit opportunities for small businesses within the defense supply chain related to this specific procurement.

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 delivery. Inspector General (IG) jurisdiction would apply in cases of fraud, waste, or abuse. Transparency is limited due to the sole-source nature, but contract award data is publicly available.

Related Government Programs

Aircraft Component Procurement
Defense Logistics Agency Contracts
RTX CORPORATION Contracts
Sole-Source Defense Acquisitions
Military Aircraft Maintenance and Repair

Risk Flags

Sole-source award
Lack of competitive bidding
No per-unit cost benchmark provided
No small business participation indicated

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.2 million to RTX CORPORATION. LINER AUGMENTOR 2840-01-443-4069NZ 4083170 86 EACH

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 $11.2 million.

What is the period of performance?

Start: 2025-09-25. End: 2028-12-01.

What is the historical spending pattern for LINER AUGMENTORs by the Department of Defense?

Analyzing historical spending on LINER AUGMENTORs by the Department of Defense is crucial for understanding trends and identifying potential anomalies. Without specific historical data for this exact part number (2840-01-443-4069NZ), a broader look at similar aircraft components is necessary. Defense spending on aircraft parts is substantial, often running into billions of dollars annually, driven by fleet size, operational tempo, and modernization efforts. Historically, sole-source awards for specialized or legacy components can lead to higher unit costs over time if not periodically re-competed or benchmarked against evolving market capabilities. Examining past solicitations and awards for comparable parts could reveal if the current pricing structure is consistent with previous procurement strategies or if it represents a deviation.

What is RTX CORPORATION's track record with similar sole-source defense contracts?

RTX CORPORATION, a major defense contractor, has a long history of securing various contracts with the U.S. government, including sole-source awards. Their track record often involves complex systems and components for aerospace and defense platforms. When evaluating sole-source contracts, it's important to consider the contractor's performance history, including on-time delivery, quality of products, and adherence to contract terms on previous engagements. While sole-source awards are often justified by factors like proprietary technology, unique capabilities, or urgent needs, a pattern of consistently high pricing or performance issues on such contracts could be a red flag. A review of publicly available contract data and performance reports for RTX CORPORATION on similar sole-source procurements would provide context for assessing the risk and value associated with this specific LINER AUGMENTOR award.

How does the firm fixed-price (FFP) contract type impact risk and value in this sole-source scenario?

The Firm Fixed-Price (FFP) contract type is generally favored by the government as it places the majority of the cost risk on the contractor. This means RTX CORPORATION is obligated to deliver the LINER AUGMENTORS for the agreed-upon price, regardless of their actual costs incurred. This can incentivize efficiency and cost control on the contractor's part. However, in a sole-source situation, the 'firm' aspect of the price is determined without competitive pressure. While the FFP structure itself is beneficial for budget predictability, the lack of competition means the initial price agreed upon might not be the most economical. The value proposition of FFP is strongest when coupled with robust competition that helps establish a fair market price from the outset.

What are the potential risks associated with a sole-source award for critical aircraft components?

Sole-source awards for critical aircraft components like LINER AUGMENTORS carry several potential risks. Firstly, the lack of competition can lead to inflated prices, as the government does not benefit from the price discovery that occurs when multiple vendors bid. Secondly, it can reduce the incentive for the sole-source provider to innovate or improve efficiency, as they face no direct competitive threat. Thirdly, it creates a dependency on a single supplier, which can be problematic if that supplier experiences production issues, financial instability, or decides to discontinue the product line. This dependency can also make it difficult to switch to alternative suppliers in the future, even if more cost-effective options become available. Finally, sole-source awards can sometimes be perceived as less transparent, raising concerns about fairness and potential impropriety if not properly justified.

Are there alternative aircraft parts or manufacturers that could fulfill the function of the LINER AUGMENTOR?

Determining if alternative aircraft parts or manufacturers could fulfill the function of this specific LINER AUGMENTOR (part number 2840-01-443-4069NZ) requires detailed technical specifications and knowledge of the aircraft platform it serves. Often, specialized components are designed for specific systems and may not have direct, off-the-shelf replacements. However, in a sole-source scenario, it is incumbent upon the procuring agency to conduct thorough market research to ascertain if viable alternatives exist, even if they require minor modifications or different integration approaches. If alternatives were explored and deemed unsuitable, the justification for the sole-source award should detail these findings. Without access to the technical data package and market research reports, it's impossible to definitively state whether alternatives exist, but the absence of competition suggests such research may have been limited or concluded negatively.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: ENGINES AND TURBINES AND COMPONENT

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: SPRTA125R0087

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

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: $11,247,967

Exercised Options: $11,247,967

Current Obligation: $11,247,967

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: SPE4A121G0001

IDV Type: BOA

Timeline