DoD's $30M Turbine Component Contract Awarded to RTX Corporation Amidst Limited Competition
Contract Overview
Contract Amount: $30,021,470 ($30.0M)
Contractor: RTX Corporation
Awarding Agency: Department of Defense
Start Date: 2014-06-20
End Date: 2016-10-31
Contract Duration: 864 days
Daily Burn Rate: $34.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: NEW MANUFACTURED MATERIAL OF HUB TURBINE, AIRCRAF; DISK AND HUB, COMPRE; DISK TURBINE; CHAMBER COMBUSTION; RETAINER TURBINE BLADE
Place of Performance
Location: EAST HARTFORD, HARTFORD County, CONNECTICUT, 06118
Plain-Language Summary
Department of Defense obligated $30.0 million to RTX CORPORATION for work described as: NEW MANUFACTURED MATERIAL OF HUB TURBINE, AIRCRAF; DISK AND HUB, COMPRE; DISK TURBINE; CHAMBER COMBUSTION; RETAINER TURBINE BLADE Key points: 1. High-value contract for critical aerospace components. 2. RTX Corporation, a major defense contractor, is the sole awardee. 3. Potential risk associated with single-source procurement for specialized parts. 4. Spending falls within the Defense sector, specifically aircraft parts manufacturing.
Value Assessment
Rating: fair
The contract value of $30,021,470.23 for turbine components appears reasonable given the specialized nature of the parts. However, without detailed cost breakdowns or benchmarks for similar complex aerospace manufacturing, a definitive assessment of value for money is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source or limited competition award. This approach may be justified if RTX Corporation possesses unique capabilities or intellectual property for these specific turbine components. However, it limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition may result in a higher price than could be achieved through a competitive bidding process, impacting taxpayer funds.
Public Impact
Ensures supply of critical components for military aircraft maintenance and readiness. Supports a major defense contractor, potentially impacting industry employment. Highlights reliance on established, large-scale manufacturers for specialized defense needs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Sole-source award
- Potential for cost overruns without competitive pressure
Positive Signals
- Ensures availability of critical components
- Supports established defense industrial base
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on turbine components. Spending benchmarks for such highly specialized parts are difficult to establish due to unique design and manufacturing requirements, but $30 million represents a significant investment.
Small Business Impact
The awardee, RTX Corporation, is a large aerospace and defense conglomerate. There is no indication that small businesses were involved in this specific contract, either as prime contractors or subcontractors, which is common for highly specialized sole-source procurements.
Oversight & Accountability
The award was made by the Defense Logistics Agency, a component of the Department of Defense responsible for supply chain management. Oversight would typically involve contract performance monitoring and financial audits to ensure compliance with the firm fixed-price agreement.
Related Government Programs
- Bolt, Nut, Screw, Rivet, and Washer Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for higher costs due to lack of competitive bidding.
- Dependence on a single contractor for critical components.
- Lack of transparency in cost justification for specialized parts.
Tags
bolt-nut-screw-rivet-and-washer-manufact, department-of-defense, ct, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $30.0 million to RTX CORPORATION. NEW MANUFACTURED MATERIAL OF HUB TURBINE, AIRCRAF; DISK AND HUB, COMPRE; DISK TURBINE; CHAMBER COMBUSTION; RETAINER TURBINE BLADE
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 $30.0 million.
What is the period of performance?
Start: 2014-06-20. End: 2016-10-31.
What is the justification for the sole-source award, and were alternative sourcing options explored?
The justification for a sole-source award typically stems from unique technical requirements, proprietary technology, or the unavailability of alternative suppliers capable of meeting the stringent specifications for critical aerospace components like turbine disks and chambers. Agencies are generally required to document extensive market research to confirm the lack of competition before proceeding with a sole-source strategy. Exploring alternatives, even if ultimately unsuccessful, is a key part of responsible procurement.
How does the unit cost of these turbine components compare to industry benchmarks, if available?
Benchmarking the unit cost for highly specialized, manufactured components like turbine disks and combustion chambers is exceptionally difficult due to proprietary designs, advanced materials, and stringent quality control required for aerospace applications. Without access to detailed specifications and RTX Corporation's internal cost structures, a direct comparison to industry benchmarks is not feasible. The 'fair' rating reflects this uncertainty and the potential for higher costs due to the lack of competition.
What is the long-term strategic impact of relying on a single supplier for such critical aircraft components?
Long-term reliance on a single supplier for critical components like turbine parts can create strategic vulnerabilities. It increases dependence on that supplier's production capacity, pricing decisions, and financial stability. While it can ensure consistent quality and supply in the short term, it may limit future innovation and negotiation leverage for the government. Diversifying suppliers or developing alternative technologies should be considered for long-term risk mitigation.
Industry Classification
NAICS: Manufacturing › Machine Shops; Turned Product; and Screw, Nut, and Bolt Manufacturing › Bolt, Nut, Screw, Rivet, and Washer Manufacturing
Product/Service Code: ENGINES AND TURBINES AND COMPONENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: RTX Corp (UEI: 001344142)
Address: 400 MAIN ST, EAST HARTFORD, CT, 06108
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $30,021,470
Exercised Options: $30,021,470
Current Obligation: $30,021,470
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPE4AX13D9424
IDV Type: IDC
Timeline
Start Date: 2014-06-20
Current End Date: 2016-10-31
Potential End Date: 2016-10-31 00:00:00
Last Modified: 2016-02-01
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