DoD Awards $25.5M for CAAS Hardware to Rockwell Collins, Raising Competition Concerns
Contract Overview
Contract Amount: $25,468,195 ($25.5M)
Contractor: Rockwell Collins, Inc.
Awarding Agency: Department of Defense
Start Date: 2009-09-29
End Date: 2014-10-15
Contract Duration: 1,842 days
Daily Burn Rate: $13.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: CAAS HARDWARE
Place of Performance
Location: CEDAR RAPIDS, LINN County, IOWA, 52498
State: Iowa Government Spending
Plain-Language Summary
Department of Defense obligated $25.5 million to ROCKWELL COLLINS, INC. for work described as: CAAS HARDWARE Key points: 1. Significant contract value of $25.5 million awarded. 2. Sole-source award to Rockwell Collins, Inc. limits competitive pricing. 3. Contract duration of 1842 days (approx. 5 years) indicates long-term need. 4. Awarded by the Department of the Army for aircraft parts manufacturing.
Value Assessment
Rating: questionable
The contract value of $25.5 million for CAAS Hardware is difficult to assess without specific unit cost data. However, the lack of competition suggests potential overpricing compared to what might be achieved in a competitive bidding environment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Rockwell Collins, Inc., was considered. This significantly limits price discovery and may result in higher costs for taxpayers.
Taxpayer Impact: The sole-source nature of this award potentially leads to increased taxpayer expenditure due to the absence of competitive pressure on pricing.
Public Impact
Taxpayers may be paying a premium for CAAS Hardware due to the lack of competition. The long contract duration suggests a sustained need for this specific hardware. Reliance on a single supplier could pose supply chain risks. The Department of the Army's procurement process for this item warrants scrutiny.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Firm Fixed Price contract type can provide cost certainty if priced competitively.
Sector Analysis
The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector is critical for defense readiness. Spending benchmarks are hard to establish without detailed cost breakdowns, but competitive awards typically yield better value.
Small Business Impact
This award does not appear to involve small businesses as prime contractors. Further analysis would be needed to determine if small businesses are included as subcontractors.
Oversight & Accountability
The sole-source nature of this award suggests a potential gap in oversight regarding competitive sourcing. A review of the justification for sole-source procurement is recommended.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing due to lack of competition.
- Long contract duration increases long-term financial commitment.
- Lack of transparency in the procurement process.
- Potential supply chain risks due to single vendor reliance.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, ia, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.5 million to ROCKWELL COLLINS, INC.. CAAS HARDWARE
Who is the contractor on this award?
The obligated recipient is ROCKWELL COLLINS, 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 $25.5 million.
What is the period of performance?
Start: 2009-09-29. End: 2014-10-15.
What was the justification for awarding this contract on a sole-source basis, and was a thorough market analysis conducted to ensure no other capable vendors could fulfill the requirement?
The justification for a sole-source award is crucial for understanding the procurement decision. Typically, sole-source contracts are used when only one vendor possesses the unique capability, technology, or intellectual property required, or in emergency situations. Without the specific justification documentation, it's impossible to definitively state the reason. However, a comprehensive market analysis should always be performed to confirm the necessity of a sole-source approach and explore potential alternatives or subcontracting opportunities for small businesses.
How does the per-unit cost of this CAAS Hardware compare to similar components acquired through competitive processes, and what is the estimated cost premium due to the sole-source award?
Without access to detailed unit cost data and benchmarks for comparable CAAS hardware acquired competitively, it is impossible to provide an exact cost premium. However, it is a widely accepted principle in government contracting that sole-source awards generally result in higher prices than competitively awarded contracts due to the absence of market pressure. Agencies often conduct should-cost analyses or rely on historical pricing, but these are less reliable than true competition.
What are the long-term risks associated with a sole-source award for critical aircraft hardware, particularly concerning supply chain resilience and potential obsolescence?
A sole-source award for critical aircraft hardware presents significant long-term risks. Supply chain resilience is compromised as the government becomes entirely dependent on a single manufacturer, making it vulnerable to disruptions, production issues, or the vendor's financial instability. Obsolescence is another concern; the sole provider may discontinue support or upgrades, forcing costly replacements or reliance on outdated technology. This lack of competition also stifles innovation and can lead to escalating maintenance and support costs over the system's lifecycle.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: FIRE CONTROL EQPT.
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W58RGZ07R0463
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 400 COLLINS ROAD NE, CEDAR RAPIDS, IA, 02
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $64,527,395
Exercised Options: $25,468,195
Current Obligation: $25,468,195
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2009-09-29
Current End Date: 2014-10-15
Potential End Date: 2017-12-31 00:00:00
Last Modified: 2014-01-21
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