DoD Awards Boeing $671.8M for KC-135 Horizontal Stabilizers Amidst Sole-Source Concerns
Contract Overview
Contract Amount: $671,827,771 ($671.8M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2025-09-25
End Date: 2032-04-30
Contract Duration: 2,409 days
Daily Burn Rate: $278.9K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MANUFACTURE OF HORIZONTAL STABLIZIERS, LEFT, RIGHT AND CENTER FOR THE KC -135 AIRCRAFT.
Place of Performance
Location: TULSA, TULSA County, OKLAHOMA, 74116
State: Oklahoma Government Spending
Plain-Language Summary
Department of Defense obligated $671.8 million to THE BOEING COMPANY for work described as: MANUFACTURE OF HORIZONTAL STABLIZIERS, LEFT, RIGHT AND CENTER FOR THE KC -135 AIRCRAFT. Key points: 1. Significant contract value for critical aircraft components. 2. Sole-source award to Boeing raises questions about competition. 3. Long contract duration (2032) requires ongoing oversight. 4. Defense Logistics Agency manages this substantial procurement.
Value Assessment
Rating: questionable
The $671.8 million award for horizontal stabilizers is substantial. Without competitive bidding, it's difficult to benchmark against similar contracts, raising concerns about potential overpricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, The Boeing Company, was considered. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying more than necessary for these critical aircraft parts.
Public Impact
Ensures continued operational readiness of the KC-135 fleet. Supports a key defense contractor, potentially impacting jobs. Highlights reliance on a single supplier for essential components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Long contract duration increases long-term financial commitment.
- Potential for cost overruns due to lack of competitive pressure.
Positive Signals
- Ensures supply of critical components for aging aircraft.
- Supports established relationship with a major defense manufacturer.
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. Spending benchmarks in this area are highly dependent on the specific component and aircraft type, but sole-source awards often deviate from competitive norms.
Small Business Impact
The data indicates this is a large sole-source contract awarded to a major prime contractor, The Boeing Company. There is no indication of subcontracting opportunities for small businesses within this specific award notice.
Oversight & Accountability
The sole-source nature of this award warrants close oversight by the Department of Defense and Congress to ensure fair pricing and prevent potential waste. Regular reviews of contract performance and cost justification are essential.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award
- Lack of price competition
- Long contract duration
- Potential for cost overruns
- Reliance on a single supplier
Tags
search-detection-navigation-guidance-aer, department-of-defense, ok, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $671.8 million to THE BOEING COMPANY. MANUFACTURE OF HORIZONTAL STABLIZIERS, LEFT, RIGHT AND CENTER 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 $671.8 million.
What is the period of performance?
Start: 2025-09-25. End: 2032-04-30.
What is the justification for awarding this contract on a sole-source basis, and has a thorough market analysis been conducted to confirm no other capable sources exist?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. A comprehensive market analysis is crucial to validate these claims and ensure no viable alternatives were overlooked. Without this information, the decision raises concerns about fair competition and potential cost inefficiencies.
How will the Defense Logistics Agency ensure cost-effectiveness and prevent overpricing given the absence of competitive bidding for these critical aircraft components?
The agency can employ several strategies, including rigorous price analysis based on historical data, should-cost modeling, and benchmarking against similar non-competitive procurements if available. Engaging independent cost estimators and negotiating firm fixed-price terms with clear performance metrics can also mitigate risks. Continuous monitoring of supplier costs and market conditions is vital.
What is the long-term strategy for KC-135 horizontal stabilizer procurement, and will future requirements be competed to foster innovation and reduce costs?
The long-term strategy should prioritize transitioning towards competitive procurements for future needs to leverage market dynamics for better pricing and innovation. This might involve breaking down requirements into smaller lots, encouraging new entrants, or exploring alternative designs. A clear roadmap for future competition should be established and communicated.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: SPRTA125R0151
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JAMES S 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: $671,827,771
Exercised Options: $671,827,771
Current Obligation: $671,827,771
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $468,510,276
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPRPA124D001E
IDV Type: IDC
Timeline
Start Date: 2025-09-25
Current End Date: 2032-04-30
Potential End Date: 2032-04-30 00:00:00
Last Modified: 2025-09-25
More Contracts from THE Boeing Company
- KC-X Modernization Program — $32.0B (Department of Defense)
- International Space Station — $22.4B (National Aeronautics and Space Administration)
- 200112!000108!9700!ZD60 !ballistic Missile Defense ORG. !HQ000601C0001 !A!N!*!N! !20001222!20080930!848025649!848025649!009256819!n!the Boeing Company !3370 E Miraloma AVE !anaheim !ca!92806!37000!089!01!huntsville !madison !alabama !+000383571022!n!n!000000000000!ad93!rdte/Other Defense-Adv Tech DEV !S1 !services !1caa!ballistic Missile Defense SYS !541710!*!*!3! ! ! !*!*!*!B!*!*!A! !A !U!R!2!001!B! !Z!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! — $18.8B (Department of Defense)
- USN P-8A FRP II Long Lead Material — $18.1B (Department of Defense)
- 200512!010860!2100!w56hzv!tacom - Warren !w56hzv05c0724 !A!N! !Y! ! !20050923!20141231!016544780!016544780!009256819!n!the Boeing Company !J S Mcdonnell Blvd !saint Louis !mo!63166!65000!510!29!st. Louis !ST. Louis (city) !missouri !+000219245691!n!n!000000000000!az15!rdte/Other Research&development-Eng/Manuf Devel !S1 !services !301 !FCS !541330!E! !1! ! ! ! ! !20200930!B! ! !A! !d!u!u!1!001!n!1a!z!y!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! ! TAS::21 2040::TAS — $12.7B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)