Textron Systems Corporation awarded $68.5M in engineering services for aircraft manufacturing, with 1414 days duration

Contract Overview

Contract Amount: $68,463,935 ($68.5M)

Contractor: Textron Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2012-06-15

End Date: 2016-04-29

Contract Duration: 1,414 days

Daily Burn Rate: $48.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: FY 12 ENGINEERING SERVICES

Place of Performance

Location: COCKEYSVILLE, BALTIMORE County, MARYLAND, 21030

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $68.5 million to TEXTRON SYSTEMS CORPORATION for work described as: FY 12 ENGINEERING SERVICES Key points: 1. Contract awarded for aircraft manufacturing engineering services, indicating a need for specialized technical support. 2. The contract's duration of 1414 days suggests a long-term requirement for these engineering services. 3. Awarded to a single contractor, raising questions about the extent of competition and potential for cost efficiencies. 4. The Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not closely managed. 5. The contract was not competed, suggesting potential limitations in market research or specific contractor capabilities. 6. The North American Industry Classification System (NAICS) code 336411 points to a focus on aircraft manufacturing.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without specific performance metrics or comparable contract data. The CPFF structure inherently carries a higher risk of cost escalation compared to fixed-price contracts. Given the lack of competition, it's difficult to assess if the pricing reflects optimal market value. Further analysis would require understanding the specific engineering tasks performed and their criticality to the overall program.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competitive bidding. This typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition limits the government's ability to leverage market forces to drive down costs and ensure the best possible value.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings typically achieved through competitive bidding processes. This can result in higher overall expenditure for the government.

Public Impact

The primary beneficiaries are likely the Department of Defense and its aircraft manufacturing programs, receiving essential engineering support. Services delivered include specialized engineering expertise crucial for the development, modification, or sustainment of aircraft. The geographic impact is centered in Maryland (ST: MD), where Textron Systems Corporation is located. Workforce implications include the employment of engineers and technical staff at Textron Systems Corporation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost Plus Fixed Fee contract type can incentivize higher costs if not managed stringently.
Lack of competition may indicate a missed opportunity for broader market engagement and innovation.
Long contract duration (1414 days) requires sustained oversight to ensure continued value and performance.
Absence of specific performance metrics makes objective value assessment difficult.

Positive Signals

Award to Textron Systems Corporation, a known entity in the defense sector, suggests established capabilities.
Engineering services are critical for complex defense programs, indicating a necessary procurement.
The contract duration implies a stable, long-term need, potentially leading to efficiencies through sustained effort.
Specific NAICS code provides clarity on the technical domain of the services.

Sector Analysis

The aircraft manufacturing sector is a critical component of the defense industrial base, characterized by high barriers to entry, significant R&D investment, and long product development cycles. Spending in this sector often involves complex engineering services for aircraft design, modification, and sustainment. Comparable spending benchmarks are difficult to establish without detailed service scope, but large-scale engineering contracts are common within the Department of Defense's aviation-related procurements.

Small Business Impact

This contract does not appear to have a small business set-aside component (SB: false). Furthermore, there is no indication of subcontracting plans specifically targeting small businesses. This suggests that the primary contractor, Textron Systems Corporation, will likely perform the majority of the work internally, with limited direct benefit or opportunity for the small business ecosystem in this particular award.

Oversight & Accountability

Oversight for this contract would fall under the Department of Defense's contract management structures, likely managed by the Defense Contract Management Agency (DCMA). Accountability measures would be tied to the terms of the Cost Plus Fixed Fee contract, requiring detailed reporting and auditing of costs and performance. Transparency is facilitated through contract databases, but the specific details of performance and cost justification may be less accessible due to the sole-source nature and potential proprietary information.

Related Government Programs

Aircraft Manufacturing
Engineering Services
Defense Procurement
Cost Plus Fixed Fee Contracts
Sole Source Contracts

Risk Flags

Sole Source Award
Cost Plus Fixed Fee Contract Type
Long Contract Duration
Lack of Competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $68.5 million to TEXTRON SYSTEMS CORPORATION. FY 12 ENGINEERING SERVICES

Who is the contractor on this award?

The obligated recipient is TEXTRON SYSTEMS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $68.5 million.

What is the period of performance?

Start: 2012-06-15. End: 2016-04-29.

What is Textron Systems Corporation's track record with similar government contracts, particularly in aircraft manufacturing engineering services?

Textron Systems Corporation has a significant history of contracting with the U.S. government, particularly within the defense sector. Their expertise spans various areas including aerospace, defense, and security solutions. For aircraft manufacturing engineering services, their track record likely includes support for aircraft design, development, testing, and sustainment. Analyzing past performance on similar Cost Plus Fixed Fee (CPFF) contracts would be crucial to assess their ability to manage costs effectively and deliver required technical outcomes. A review of their contract history, including any past performance evaluations or awards/debarments, would provide a clearer picture of their reliability and capability in fulfilling complex engineering requirements for the Department of Defense.

How does the $68.5 million contract value compare to other engineering service contracts within the aircraft manufacturing sector?

The $68.5 million contract value for engineering services in aircraft manufacturing is substantial, reflecting the complexity and duration of the work. However, without specific details on the scope of services, it's challenging to make a direct comparison. Large-scale defense contracts for aircraft development or sustainment can range from tens of millions to billions of dollars. This particular contract's value should be benchmarked against similar sole-source, CPFF contracts for engineering support on specific aircraft platforms or programs. If this represents a significant portion of a larger program's engineering budget, or if it's unusually high for the defined scope compared to other sole-source awards, it might warrant closer scrutiny regarding value for money.

What are the primary risks associated with a sole-source, Cost Plus Fixed Fee contract for engineering services?

The primary risks associated with a sole-source, Cost Plus Fixed Fee (CPFF) contract are twofold. Firstly, the sole-source nature eliminates competitive pressure, potentially leading to higher prices than might be achieved in a competitive environment. The government has less leverage to negotiate favorable terms. Secondly, the CPFF structure, while allowing for flexibility in evolving requirements, shifts much of the cost risk to the government. Contractors are reimbursed for allowable costs plus a fixed fee, which can incentivize cost overruns as the fee remains constant regardless of the final cost. Effective oversight, stringent cost controls, and clear performance metrics are essential to mitigate these risks and ensure value.

What is the historical spending pattern for engineering services related to aircraft manufacturing by the Department of Defense?

The Department of Defense (DoD) consistently allocates significant funds towards engineering services for aircraft manufacturing. Historical spending patterns reveal a continuous need for specialized technical expertise to support the design, development, modification, and maintenance of its vast aircraft fleet. This spending is influenced by modernization programs, new platform acquisitions, and sustainment efforts for existing assets. While specific figures fluctuate annually based on strategic priorities and budget allocations, engineering services represent a substantial and ongoing investment within the DoD's overall R&D and procurement budgets. Analyzing trends over multiple fiscal years would show the scale and consistency of this investment.

How does the 1414-day duration of the contract impact its overall value and risk profile?

The 1414-day duration (approximately 3.87 years) of this contract indicates a long-term requirement for the engineering services. From a value perspective, a longer duration can sometimes lead to economies of scale and more predictable resource allocation for the contractor, potentially translating to better overall value if managed effectively. However, it also increases the risk profile. Over such an extended period, requirements can change, technology can evolve, and the potential for cost creep in a CPFF contract is amplified. Sustained, rigorous oversight is critical to ensure the services remain relevant, costs are controlled, and performance objectives are met throughout the contract's life.

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: W58RGZ12R0001

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Textron Inc

Address: 124 INDUSTRY LN, HUNT VALLEY, MD, 21030

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: $69,308,555

Exercised Options: $69,308,555

Current Obligation: $68,463,935

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline