Honeywell International Inc. awarded $14.9M contract for aircraft parts, raising questions about competition and value

Contract Overview

Contract Amount: $14,941,498 ($14.9M)

Contractor: Honeywell International Inc.

Awarding Agency: Department of Defense

Start Date: 2004-02-12

End Date: 2007-06-30

Contract Duration: 1,234 days

Daily Burn Rate: $12.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200408!002150!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ04C0091 !A!N! !N! ! !20040212!20050730!071896336!071896336!139691877!N!HONEYWELL INTERNATIONAL INC !2525 W 190TH STREET !TORRANCE !CA!90504!80000!037!06!TORRANCE !LOS ANGELES !CALIFORNIA!+000006396190!N!N!000000000000!4140!FANS, AIR CIRCULATORS, & BLOWER EQUIP !A1A!AIRFRAMES AND SPARES !000 !* !336413!E! !1! ! ! ! ! !99990909!B! ! !N!A!D!N!J!1!001!N!2A!A!Y!A! ! !N!C!N! ! ! !Z!Z!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: TEMPE, MARICOPA County, ARIZONA, 85284

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $14.9 million to HONEYWELL INTERNATIONAL INC. for work described as: 200408!002150!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ04C0091 !A!N! !N! ! !20040212!20050730!071896336!071896336!139691877!N!HONEYWELL INTERNATIONAL INC !2525 W 190TH STREET !TORRANCE !CA!90504!80000!037!06!TORRANCE !LOS … Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery. 2. Significant contract value for aircraft parts suggests a critical need or sole-source justification. 3. Long contract duration (over 1 year) may indicate a need for sustained supply. 4. The award to a large corporation warrants scrutiny for potential cost efficiencies. 5. Geographic location of contractor in California may have implications for logistics and support. 6. The specific part number (336413) points to a specialized component within aircraft systems.

Value Assessment

Rating: questionable

The contract value of $14.9 million for aircraft parts appears substantial. Without a competitive bidding process, it is difficult to benchmark this price against market rates or similar contracts. The lack of competition raises concerns about whether the government secured the best possible price. Further analysis would be needed to compare the unit cost of these parts to industry standards or previous procurements of similar items.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT COMPETED' basis, indicating a sole-source procurement. This means that only one vendor, Honeywell International Inc., was solicited for this requirement. The lack of competition prevents a robust price discovery process and may result in higher costs for the government compared to a fully competed contract. It suggests that either only Honeywell could provide the specific parts, or the justification for not competing was based on factors other than a lack of alternatives.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from competitive pricing, potentially leading to overpayment for goods and services.

Public Impact

The U.S. Army, a branch of the Department of Defense, is the primary beneficiary of this contract. The contract delivers essential aircraft parts, likely for maintenance, repair, and overhaul (MRO) operations. The geographic impact is national, supporting aviation readiness across various Army installations. Workforce implications include the potential for continued employment at Honeywell's Torrance, CA facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices.
Potential for vendor lock-in due to specialized parts.
Limited transparency in pricing due to sole-source award.

Positive Signals

Award to established contractor Honeywell International Inc. suggests reliability.
Contract duration indicates a stable supply chain for critical components.
Specific part identification (336413) implies a well-defined requirement.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically concerning aircraft parts and auxiliary equipment. The market for such components is characterized by high technical specifications, stringent quality control, and often, proprietary technology. While the exact market size for this specific part is not detailed, the broader industry for aircraft parts and MRO is substantial, with significant government spending. This contract represents a portion of that spending, likely for specialized components where original equipment manufacturers (OEMs) or their authorized distributors are the primary suppliers.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting plans for small businesses in the provided data. The award to a large corporation like Honeywell International Inc. suggests that the primary focus was on fulfilling the requirement directly. This could mean missed opportunities for small businesses to participate in the supply chain for these specific aircraft parts.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. The Defense Contract Audit Agency (DCAA) may also be involved in auditing costs, especially given the contract's value and non-competitive nature. Transparency is limited due to the sole-source award, but contract modifications, performance reports, and payment data would be subject to internal government review and potentially public disclosure through systems like FPDS.

Related Government Programs

Aircraft Parts and Auxiliary Equipment
Aerospace Manufacturing
Department of Defense Procurement
Army Aviation Support
Sole-Source Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.9 million to HONEYWELL INTERNATIONAL INC.. 200408!002150!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ04C0091 !A!N! !N! ! !20040212!20050730!071896336!071896336!139691877!N!HONEYWELL INTERNATIONAL INC !2525 W 190TH STREET !TORRANCE !CA!90504!80000!037!06!TORRANCE !LOS ANGELES !CALIFORNIA!+000006396190!N!N!000000000000!4140!FANS, AIR CIRCULATORS, & BLOWER EQUIP !A1A!AIRFRAMES AND SPARES !000 !* !336413!E! !1! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is HONEYWELL INTERNATIONAL INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $14.9 million.

What is the period of performance?

Start: 2004-02-12. End: 2007-06-30.

What is the specific function and criticality of part number 336413 (FANS, AIR CIRCULATORS, & BLOWER EQUIP)?

Part number 336413 is identified as 'FANS, AIR CIRCULATORS, & BLOWER EQUIP'. This suggests it is a component related to the environmental control systems or ventilation within an aircraft. Such equipment is critical for maintaining cabin pressure, temperature, and air quality, ensuring crew and passenger comfort and safety, as well as the proper functioning of other onboard systems that may be sensitive to heat or require airflow. Its criticality lies in its contribution to the overall airworthiness and operational effectiveness of the aircraft.

Why was this contract awarded on a sole-source basis instead of being competed?

The provided data indicates the contract was 'NOT COMPETED'. Common justifications for sole-source awards include that the item is available only from a single source (e.g., proprietary technology, unique manufacturing capability), or that there is an urgent, compelling need that cannot be met through competition. Without further documentation from the awarding agency (Department of the Army), the specific reason remains unknown. However, for specialized aircraft components like fans or blowers, it's plausible that Honeywell holds unique manufacturing rights or possesses the only approved source for specific military aircraft platforms, necessitating a sole-source procurement.

How does the contract value of $14.9 million compare to similar procurements for aircraft fans and blowers?

Direct comparison of the $14.9 million contract value for aircraft fans, air circulators, and blower equipment is challenging without knowing the exact quantity, specifications, and specific aircraft platforms involved. However, this value is substantial for such components, suggesting either a very large quantity order, a high unit cost for specialized or technologically advanced parts, or a long-term support agreement. Typically, individual fans or blowers might cost thousands to tens of thousands of dollars, depending on complexity and certification. A $14.9 million total contract value implies a significant procurement effort, potentially covering multiple aircraft or a lengthy sustainment period.

What is Honeywell International Inc.'s track record with the Department of Defense for similar parts?

Honeywell International Inc. is a major defense contractor with a long history of supplying various components and systems to the Department of Defense. While specific data on their track record for 'FANS, AIR CIRCULATORS, & BLOWER EQUIP' (part 336413) is not detailed here, the company is known for producing a wide range of aerospace products, including engines, avionics, and environmental control systems. Their extensive experience and established presence in the defense market suggest a capacity to meet the technical and logistical demands of such contracts. Historical data would likely show numerous awards for similar or related aerospace components.

What are the potential risks associated with a sole-source contract of this magnitude?

The primary risk associated with a sole-source contract of this magnitude ($14.9 million) is the potential for inflated pricing due to the lack of competitive pressure. The government may not be achieving the best value for its expenditure. Other risks include vendor lock-in, where the government becomes dependent on a single supplier, potentially limiting future options or negotiating leverage. There's also a reduced incentive for the contractor to innovate or improve efficiency beyond what is contractually required. Furthermore, the lack of transparency in the procurement process can raise concerns about fairness and potential inefficiencies.

What is the historical spending trend for this specific part number or category by the Department of the Army?

Historical spending data for the specific part number 336413 or the broader category 'FANS, AIR CIRCULATORS, & BLOWER EQUIP' by the Department of the Army is not directly available in the provided snippet. However, the presence of this contract suggests recurring needs for such components within Army aviation programs. Analyzing past contract awards for similar parts or within the 'AIRFRAMES AND SPARES' (A1A) or 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (ND) categories over several fiscal years would be necessary to establish a spending trend. This would help determine if $14.9 million represents an increase, decrease, or stable level of investment in these types of parts.

Industry Classification

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

Product/Service Code: REFRIG, AIR CONDIT/CIRCULAT EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: Honeywell International Inc (UEI: 139691877)

Address: 2525 W 190TH STREET, TORRANCE, CA, 90

Business Categories: Category Business, Not Designated a Small Business

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