DoD awards $38.5M for aircraft parts, with Boeing securing the sole-source contract
Contract Overview
Contract Amount: $38,465,190 ($38.5M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2017-09-22
End Date: 2020-06-17
Contract Duration: 999 days
Daily Burn Rate: $38.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: HOOK,ARRESTING,AIRC
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $38.5 million to THE BOEING COMPANY for work described as: HOOK,ARRESTING,AIRC Key points: 1. Contract awarded to a single, established provider, raising questions about competitive pricing. 2. The fixed-price contract structure aims to control costs, but lacks competitive pressure. 3. Delivery order issued under a larger contract, suggesting potential for follow-on work. 4. Focus on aircraft parts indicates a critical need within the defense supply chain. 5. The contract's duration and value warrant scrutiny for long-term cost-effectiveness.
Value Assessment
Rating: fair
The contract value of $38.5 million for aircraft parts appears reasonable given the sole-source nature and the specialized products likely required. However, without competitive bids, it's difficult to benchmark the true value for money. The firm fixed-price structure provides cost certainty for the government, but the absence of competition may lead to higher-than-market prices. Further analysis would require comparing unit prices for similar components if available.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This typically occurs when only one vendor can provide the required goods or services, or for reasons of urgency or national security. The lack of competition means the government did not benefit from a bidding process that could drive down prices and encourage innovation. The award to a single entity limits price discovery and potentially increases costs for taxpayers.
Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the best possible price, as there was no opportunity for multiple vendors to compete and offer lower bids.
Public Impact
The Department of Defense benefits from the acquisition of essential aircraft parts. This contract supports the operational readiness of military aircraft. The primary beneficiaries are military personnel relying on well-maintained aircraft. The contract supports jobs within The Boeing Company and its supply chain.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to inflated prices.
- Sole-source awards can limit innovation and vendor diversity.
- Long-term reliance on a single supplier can create supply chain vulnerabilities.
Positive Signals
- Firm fixed-price contract provides cost certainty.
- Award to a major defense contractor suggests reliability and established capability.
- Contract supports critical defense logistics and aircraft maintenance.
Sector Analysis
The aerospace and defense sector is characterized by high barriers to entry, significant R&D investment, and long product lifecycles. This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sub-sector. Spending in this area is crucial for maintaining the operational readiness of military fleets. Comparable spending benchmarks are difficult to establish without detailed product specifications, but the overall defense procurement budget for aircraft components is substantial.
Small Business Impact
This contract was awarded directly to The Boeing Company and does not appear to include specific small business set-aside provisions. There is no indication of subcontracting goals for small businesses within the provided data. This suggests that opportunities for small businesses may be limited unless they are direct suppliers to Boeing for this specific contract.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of Defense's contracting and financial management regulations. The Defense Contract Management Agency (DCMA) likely provides oversight for contract performance and delivery. Transparency is facilitated through contract databases like FPDS, but detailed performance metrics and cost breakdowns are often not publicly available for sole-source awards.
Related Government Programs
- Aircraft Maintenance and Repair
- Defense Logistics Support
- Aerospace Manufacturing
- Military Aircraft Parts
Risk Flags
- Sole-source award
- Lack of competition
- Potential for price inflation
Tags
defense, department-of-defense, defense-logistics-agency, the-boeing-company, aircraft-parts, sole-source, firm-fixed-price, delivery-order, missouri, other-aircraft-parts-and-auxiliary-equipment-manufacturing
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $38.5 million to THE BOEING COMPANY. HOOK,ARRESTING,AIRC
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 $38.5 million.
What is the period of performance?
Start: 2017-09-22. End: 2020-06-17.
What is the track record of The Boeing Company in fulfilling similar defense contracts?
The Boeing Company is a major global aerospace company and a leading defense contractor with a long history of delivering aircraft, defense systems, and related services to the U.S. military and international customers. They have extensive experience in manufacturing and supplying aircraft parts, engines, and components. Their track record includes numerous large-scale contracts for various military platforms, such as fighter jets, bombers, transport aircraft, and helicopters. While generally considered reliable, Boeing has also faced scrutiny and challenges on specific programs related to production delays, cost overruns, and quality control issues. For this specific contract, its sole-source nature suggests a pre-existing relationship or a unique capability that Boeing possesses for the required parts.
How does the $38.5 million contract value compare to similar sole-source awards for aircraft parts?
Benchmarking sole-source awards is inherently challenging due to the lack of competitive pricing. The $38.5 million value for aircraft parts is significant and suggests a substantial quantity or high-value components. To assess value for money, one would ideally compare the unit prices of the specific parts procured under this contract against historical prices paid by the DoD for the same or equivalent parts, or against prices from other potential suppliers if such data were available. Without this granular data, it's difficult to definitively state if this represents good or poor value. However, sole-source awards often carry a premium compared to competed contracts.
What are the primary risks associated with this sole-source contract for aircraft parts?
The primary risks associated with this sole-source contract include potential price inflation due to the absence of competition, limited opportunities for technological innovation from alternative suppliers, and increased dependency on a single contractor. If The Boeing Company faces production issues, supply chain disruptions, or financial difficulties, it could significantly impact the availability of critical aircraft parts, potentially affecting military readiness. Furthermore, the lack of transparency in pricing negotiations for sole-source awards can obscure inefficiencies or excessive profit margins, posing a risk to taxpayer funds.
What is the expected program effectiveness or outcome of this contract?
The expected outcome of this contract is the timely delivery of essential aircraft parts to the Department of Defense, ensuring the continued operational readiness and maintenance of military aircraft. The effectiveness will be measured by the quality and reliability of the delivered parts, adherence to delivery schedules, and the overall contribution to maintaining the airworthiness of the fleet. Given that this is for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' it likely supports a broad range of aircraft systems. Successful execution means fewer aircraft grounding due to parts shortages and sustained mission capability.
What has been the historical spending pattern for aircraft parts by the Defense Logistics Agency?
The Defense Logistics Agency (DLA) is responsible for providing logistics support to the U.S. Armed Forces, including the procurement of a vast array of parts and equipment. Historical spending patterns for aircraft parts by DLA are substantial, reflecting the continuous need to maintain a large and diverse military aviation fleet. DLA procures billions of dollars worth of aviation-related items annually, encompassing everything from engine components and airframes to avionics and consumables. Spending fluctuates based on modernization programs, operational tempo, and the lifecycle of different aircraft platforms. Contracts for parts can range from small, routine orders to large, multi-year sole-source agreements for specialized or long-lead-time items, similar to this award.
Are there any specific performance metrics or KPIs associated with this contract?
The provided data does not specify the exact performance metrics or Key Performance Indicators (KPIs) for this particular contract. However, for defense contracts of this nature, typical performance metrics often include on-time delivery rates, quality acceptance rates (minimizing defects), adherence to technical specifications, and compliance with contractual terms. The Defense Contract Management Agency (DCMA) would likely monitor these aspects. For a sole-source award, the emphasis might be more heavily placed on ensuring delivery schedules are met and that the parts conform to the required standards, given the lack of competitive pressure to drive performance improvements.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: SPRPA115QX436
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: $38,465,190
Exercised Options: $38,465,190
Current Obligation: $38,465,190
Subaward Activity
Number of Subawards: 2
Total Subaward Amount: $537,578
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: SPE4A116G0010
IDV Type: BOA
Timeline
Start Date: 2017-09-22
Current End Date: 2020-06-17
Potential End Date: 2020-06-17 00:00:00
Last Modified: 2019-05-01
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