Honeywell International Inc. awarded $96.9M for engineering services by Army Aviation and Missile Command
Contract Overview
Contract Amount: $96,934,838 ($96.9M)
Contractor: Honeywell International Inc.
Awarding Agency: Department of Defense
Start Date: 2005-02-22
End Date: 2024-02-06
Contract Duration: 6,923 days
Daily Burn Rate: $14.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: TAS::97 4930::TAS TREASURY CODE W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ05C0020
Place of Performance
Location: PHOENIX, MARICOPA County, ARIZONA, 85034
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $96.9 million to HONEYWELL INTERNATIONAL INC. for work described as: TAS::97 4930::TAS TREASURY CODE W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ05C0020 Key points: 1. Contract awarded for engineering services, a critical component of defense readiness. 2. The contract's duration spans over 19 years, indicating long-term support needs. 3. Awarded as a sole-source contract, raising questions about potential cost efficiencies. 4. The firm-fixed-price structure aims to control costs, but competition is absent. 5. Geographic location of performance is Arizona. 6. The contract value is substantial, reflecting significant investment in specialized engineering.
Value Assessment
Rating: fair
The contract value of $96.9 million over nearly two decades for engineering services warrants scrutiny. Without competitive bidding, it is difficult to benchmark pricing against market rates or similar contracts. The firm-fixed-price nature provides some cost certainty, but the lack of competition means potential savings may have been forgone. Further analysis would require access to detailed cost breakdowns and comparisons with other sole-source engineering contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Honeywell International Inc., was solicited. This approach bypasses the competitive bidding process, which typically drives down prices and encourages innovation. While sole-source awards can be justified for unique capabilities or urgent needs, they reduce transparency and limit opportunities for other qualified businesses to compete for government work.
Taxpayer Impact: Taxpayers may not be receiving the best possible value due to the absence of a competitive bidding process. This could result in higher costs than if multiple vendors had vied for the contract.
Public Impact
The U.S. Army Aviation and Missile Command benefits from specialized engineering expertise. Services likely support the development, maintenance, or enhancement of aviation and missile systems. The contract's performance is based in Arizona, potentially impacting the local economy and workforce. This contract ensures the continued availability of critical engineering support for defense programs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to inflated costs.
- Long contract duration could mask inefficiencies.
- Sole-source award limits market visibility for potential cost savings.
Positive Signals
- Firm-fixed-price contract provides cost certainty.
- Honeywell is an established provider of aerospace and defense solutions.
- Contract ensures continuity of essential engineering services.
Sector Analysis
This contract falls within the Engineering Services sector, a vital part of the broader aerospace and defense industry. The market for specialized engineering services supporting complex defense systems is often characterized by high barriers to entry due to required expertise and security clearances. Comparable spending benchmarks are difficult to establish without more specific details on the services rendered, but significant government investment in this area is common.
Small Business Impact
The contract data indicates that small business participation was not a stated requirement or outcome for this award (ss: false, sb: false). As a sole-source contract awarded to a large corporation, there are limited direct opportunities for small businesses to participate as prime contractors. Subcontracting opportunities may exist, but they are not explicitly detailed in the provided data and would depend on Honeywell's procurement practices.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The firm-fixed-price structure provides a degree of accountability by setting a ceiling on costs. Transparency is limited due to the sole-source nature of the award. Further oversight details would depend on the specific contract clauses and reporting requirements.
Related Government Programs
- Army Aviation and Missile Command Procurement
- Defense Engineering Services Contracts
- Sole-Source Defense Contracts
- Aerospace Engineering Support
Risk Flags
- Sole-source award
- Long contract duration
- Lack of detailed service description
Tags
defense, department-of-defense, army-aviation-and-missile-command, engineering-services, sole-source, firm-fixed-price, honeywell-international-inc, arizona, large-contract, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $96.9 million to HONEYWELL INTERNATIONAL INC.. TAS::97 4930::TAS TREASURY CODE W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ05C0020
Who is the contractor on this award?
The obligated recipient is HONEYWELL INTERNATIONAL INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $96.9 million.
What is the period of performance?
Start: 2005-02-22. End: 2024-02-06.
What specific engineering services are being provided under this contract?
The provided data classifies the contract under NAICS code 541330 (Engineering Services) and the PSC code is blank, making it difficult to ascertain the exact nature of the services. However, given the awarding agency (Army Aviation and Missile Command) and the contractor (Honeywell International Inc.), it is highly probable that these services relate to the design, development, testing, integration, or sustainment of aviation and missile systems. This could encompass a wide range of activities, from conceptual design and prototyping to systems engineering, technical support, and lifecycle management for complex military hardware.
How does the $96.9 million contract value compare to similar engineering services contracts awarded by the Department of Defense?
Benchmarking this $96.9 million contract value against similar engineering services contracts is challenging without more specific details on the scope of work and duration. However, for long-term, sole-source engineering support for major defense systems, this value is not unusual. Many large-scale defense programs require sustained engineering expertise over many years, leading to substantial contract values. The nearly 20-year duration of this contract contributes significantly to its overall value. A more precise comparison would require analyzing contracts with similar service types, durations, and complexity levels awarded to large defense contractors.
What are the primary risks associated with a sole-source contract of this magnitude and duration?
The primary risks associated with a sole-source contract of this magnitude and duration include potential cost overruns due to a lack of competitive pressure, reduced incentive for innovation from the contractor, and a lack of transparency in pricing. Taxpayers may not be receiving the best value for their money. Furthermore, the long duration could lead to vendor lock-in, making it difficult to switch providers or adopt new technologies if they emerge. There's also a risk that the contractor's focus may shift away from optimal performance if they perceive less oversight due to the lack of competition.
What is Honeywell International Inc.'s track record with the Army Aviation and Missile Command?
Honeywell International Inc. is a major defense contractor with a long history of providing various products and services to the Department of Defense, including the Army Aviation and Missile Command (AMCOM). While specific details of their past performance with AMCOM are not provided in this data snippet, Honeywell is known for its expertise in aerospace, avionics, and defense systems. Their extensive experience suggests a likely capability to fulfill the engineering services required. However, a comprehensive assessment would involve reviewing past performance evaluations and any documented issues or successes on previous contracts with AMCOM.
What are the implications of the firm-fixed-price (FFP) contract type for cost control?
The firm-fixed-price (FFP) contract type is generally considered favorable for cost control from the government's perspective. Under an FFP contract, the contractor agrees to a total price for a well-defined scope of work. This shifts the risk of cost overruns to the contractor. If Honeywell's costs exceed the agreed-upon price, they absorb the loss. Conversely, if their costs are lower than anticipated, they retain the profit. This structure incentivizes the contractor to manage their costs efficiently. However, the effectiveness of FFP in controlling costs can be diminished in sole-source situations where competition is absent, potentially leading to an initially higher negotiated price.
How has spending on engineering services by the Army Aviation and Missile Command trended historically?
Historical spending trends for engineering services by the Army Aviation and Missile Command (AMCOM) are not directly available from the provided data. However, defense agencies like AMCOM consistently require significant investment in engineering services to support the lifecycle of complex weapon systems, including aviation and missile technologies. Spending in this area is typically driven by modernization programs, sustainment requirements, and research and development initiatives. Fluctuations in spending can be influenced by budget allocations, geopolitical events, and the specific needs of ongoing defense programs. A detailed analysis would require access to historical procurement data for AMCOM.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
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: Honeywell International Inc
Address: 1300 W WARNER RD, TEMPE, AZ, 85284
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2005-02-22
Current End Date: 2024-02-06
Potential End Date: 2024-02-06 00:00:00
Last Modified: 2024-01-27
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