Army Awards Boeing $37.2M for 2 MQ-18A Aircraft Upgrades to Modified Block II Configuration
Contract Overview
Contract Amount: $37,201,516 ($37.2M)
Contractor: Boeing Company, the
Awarding Agency: Department of Defense
Start Date: 2011-02-25
End Date: 2012-09-29
Contract Duration: 582 days
Daily Burn Rate: $63.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: UPGRADE OF 2 YMQ-18A AIRCRAFT TO MODIFIED BLOCK II CONFIGURATION
Place of Performance
Location: MESA, MARICOPA County, ARIZONA, 85215
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $37.2 million to BOEING COMPANY, THE for work described as: UPGRADE OF 2 YMQ-18A AIRCRAFT TO MODIFIED BLOCK II CONFIGURATION Key points: 1. Boeing secured the contract for aircraft upgrades. 2. The contract value is $37.2 million. 3. The upgrade aims to enhance aircraft capabilities to a modified Block II configuration. 4. This is a sole-source award, raising questions about competition. 5. The sector is Aircraft Manufacturing.
Value Assessment
Rating: fair
The contract is a Cost Plus Fixed Fee type, which can lead to cost overruns if not managed carefully. Benchmarking against similar aircraft upgrade contracts is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition may result in a higher cost to taxpayers than if the contract had been awarded through a competitive bidding process.
Public Impact
Taxpayers may be paying a premium due to the sole-source nature of the award. The upgrade enhances the capabilities of existing military assets, potentially improving operational effectiveness. The contract duration is 582 days, indicating a significant period for the upgrade work.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Cost-plus contract type carries inherent risk of cost overruns.
- Lack of detailed cost breakdown makes value assessment difficult.
Positive Signals
- Upgrades existing military hardware, potentially increasing operational readiness.
- Contract awarded to a known entity, The Boeing Company.
Sector Analysis
The Aircraft Manufacturing sector is critical for defense procurement. Spending benchmarks for specific aircraft upgrades can vary widely based on complexity and aircraft type. This contract falls within the defense spending domain.
Small Business Impact
The contract was awarded to The Boeing Company, a large prime contractor. There is no indication of small business participation in this specific award, which is common for large sole-source defense contracts.
Oversight & Accountability
As a sole-source award, oversight is crucial to ensure fair pricing and efficient execution. The Department of the Army's contracting officers are responsible for monitoring performance and costs.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
- Potential for cost overruns
- Limited small business participation
Tags
aircraft-manufacturing, department-of-defense, az, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $37.2 million to BOEING COMPANY, THE. UPGRADE OF 2 YMQ-18A AIRCRAFT TO MODIFIED BLOCK II CONFIGURATION
Who is the contractor on this award?
The obligated recipient is BOEING COMPANY, THE.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $37.2 million.
What is the period of performance?
Start: 2011-02-25. End: 2012-09-29.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without further documentation, it's difficult to assess if competitive strategies were thoroughly explored. Agencies must demonstrate why competition is not feasible to justify sole-source procurement, ensuring taxpayer funds are used efficiently.
How does the fixed fee in this Cost Plus Fixed Fee contract compare to industry standards for similar aircraft modifications?
Assessing the fairness of the fixed fee requires detailed knowledge of the specific modifications, labor hours, material costs, and profit margins typical for this type of aircraft upgrade. Benchmarking against similar contracts, if available, would provide a clearer picture. Without such data, it's challenging to determine if the fee is competitive or excessive.
What specific performance improvements or capabilities are expected from the modified Block II configuration, and how will their effectiveness be measured?
The effectiveness of the upgrade hinges on the specific enhancements delivered by the Block II configuration. Expected improvements might include enhanced avionics, increased payload capacity, or improved survivability. Measuring effectiveness would likely involve rigorous testing, operational deployment feedback, and comparison against pre-upgrade performance metrics and mission requirements.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W58RGZ11R0180
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: THE Boeing Company (UEI: 009256819)
Address: 5000 E MCDOWELL ROAD, MESA, AZ, 85215
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: $49,017,527
Exercised Options: $49,017,527
Current Obligation: $37,201,516
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2011-02-25
Current End Date: 2012-09-29
Potential End Date: 2012-09-29 00:00:00
Last Modified: 2016-04-12
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