DoD awards $54.4M for 4 Bell 412EP aircraft, with Bell Textron Inc. as the sole source provider

Contract Overview

Contract Amount: $54,426,267 ($54.4M)

Contractor: Bell Textron Inc

Awarding Agency: Department of Defense

Start Date: 2017-06-20

End Date: 2018-12-31

Contract Duration: 559 days

Daily Burn Rate: $97.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: PROCUREMENT OF 4 BELL412EP AIRCRAFT

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76118

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $54.4 million to BELL TEXTRON INC for work described as: PROCUREMENT OF 4 BELL412EP AIRCRAFT Key points: 1. The contract value of $54.4 million for four aircraft represents a significant investment in specialized aviation assets. 2. Sole-source procurement raises questions about potential price inflation and the absence of competitive pressure. 3. The fixed-firm price contract structure shifts cost risk to the contractor, which can be beneficial for the government. 4. The duration of 559 days suggests a focused, near-term delivery requirement for these aircraft. 5. The procurement falls under the Aircraft Manufacturing NAICS code, indicating a focus on specialized production. 6. The absence of small business set-asides means opportunities for smaller firms in this specific procurement are limited.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without comparable sole-source procurements of similar aircraft. The price per aircraft is approximately $13.6 million. Given the specialized nature of military-grade helicopters, this figure may fall within a reasonable range, but the lack of competition prevents a definitive assessment of optimal value for money. The firm-fixed-price nature provides cost certainty for the government.

Cost Per Unit: Approximately $13.6 million per aircraft. Direct comparison is difficult due to sole-source nature and specific configuration requirements.

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Bell Textron Inc., was solicited. This approach is typically used when only one responsible source is available or when there is a compelling justification for excluding competition. The lack of competition means the government did not benefit from price discovery through multiple bids, potentially leading to a higher price than if it had been competed.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. Without a competitive process, it is difficult to ascertain if the government secured the best possible price for these aircraft.

Public Impact

The primary beneficiaries are the Department of Defense, which will receive four new Bell 412EP aircraft for its operational needs. These aircraft will likely support various military missions, potentially including transport, utility, or special operations, depending on their final configuration. The geographic impact is primarily within Texas, where Bell Textron Inc. is located, but the operational deployment of the aircraft will be determined by military requirements. The procurement supports jobs within the aerospace manufacturing sector, specifically at Bell Textron Inc. and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Lack of transparency in the justification for sole-source procurement.
No small business participation noted in this direct award.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Procurement of specific, potentially critical, aviation assets.
Contract awarded to a known manufacturer with established capabilities.

Sector Analysis

The aerospace and defense sector is characterized by high barriers to entry, significant R&D investment, and often long production cycles. Aircraft manufacturing, a sub-sector, involves complex engineering and stringent quality control. The market for specialized military aircraft is typically dominated by a few large, established prime contractors. This contract for Bell 412EP aircraft fits within this landscape, representing a specific procurement within the broader defense aviation market. Comparable spending benchmarks would involve other military aircraft procurements, which can vary widely based on type and quantity.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The award to Bell Textron Inc., a large aerospace manufacturer, suggests that the primary focus was on acquiring the aircraft directly from the original equipment manufacturer. This means that opportunities for small businesses to directly participate in this specific contract award are likely minimal, though they may be involved further down the supply chain if they are suppliers to Bell Textron.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. As a definitive contract, it is subject to standard government oversight procedures. Transparency is limited by the sole-source nature of the award; the specific justification for not competing the contract would be key to assessing transparency. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Aircraft Procurement
Helicopter Manufacturing
Defense Aviation Contracts
Sole-Source Procurements

Risk Flags

Sole-source award
Lack of competition
Potential for price inflation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $54.4 million to BELL TEXTRON INC. PROCUREMENT OF 4 BELL412EP AIRCRAFT

Who is the contractor on this award?

The obligated recipient is BELL TEXTRON 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 $54.4 million.

What is the period of performance?

Start: 2017-06-20. End: 2018-12-31.

What is the specific justification provided by the Department of Defense for awarding this contract on a sole-source basis to Bell Textron Inc.?

The provided data indicates the contract was 'NOT COMPETED'. While the specific justification is not detailed in the abbreviated data, sole-source awards are typically justified under circumstances such as only one responsible source being available, or when a public exigency requires immediate procurement, or when the agency has entered into a sole-source contract with a particular firm for reasons of standardization and interoperability. For aircraft, justifications often relate to unique capabilities, existing fleet commonality, or specialized modifications only available from the original manufacturer. A full review of the contract file, including the Justification and Approval (J&A) document, would be necessary to understand the precise rationale.

How does the per-unit cost of $13.6 million for the Bell 412EP aircraft compare to similar military helicopter procurements?

Comparing the per-unit cost of $13.6 million for the Bell 412EP requires careful consideration of aircraft type, mission configuration, and procurement volume. The Bell 412EP is a medium utility helicopter. Military procurements of similar-sized utility or transport helicopters can range significantly. For instance, new procurements of Black Hawk variants (UH-60) can exceed $20 million per unit, while smaller utility helicopters might be in the $5-10 million range. Without knowing the exact military configuration and mission systems installed on these specific Bell 412EPs, a precise benchmark is difficult. However, $13.6 million per unit for a new, military-configured medium helicopter is not inherently unreasonable, but the sole-source nature prevents confirmation of optimal value.

What are the potential risks associated with a sole-source procurement of this magnitude for military aircraft?

The primary risk of a sole-source procurement is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may pay more than it would in an open market scenario. Another risk is reduced innovation, as the sole provider may have less incentive to offer cost-saving improvements or advanced features. Furthermore, sole-source awards can sometimes indicate a lack of strategic planning or market analysis by the procuring agency, potentially leading to over-reliance on a single supplier. There's also a reputational risk if the justification for sole-sourcing is not perceived as robust by oversight bodies or the public.

What is the typical role and capability of the Bell 412EP in military operations?

The Bell 412EP is a versatile twin-engine helicopter known for its reliability and utility. In military contexts, it is often employed for a range of missions including troop transport, cargo movement, medical evacuation (MEDEVAC), search and rescue (SAR), reconnaissance, and special operations support. Its cabin can be configured to accommodate passengers, litters, or specialized equipment. The 'EP' designation typically indicates enhanced performance features. Its medium-lift capability makes it suitable for various operational theaters where flexibility and moderate payload capacity are required.

What is the historical spending trend for Bell 412EP aircraft or similar platforms by the Department of Defense?

Historical spending data for specific aircraft models like the Bell 412EP by the DoD can be complex to track comprehensively without access to detailed procurement databases. The Bell 412 platform has been in service for many years, and various military branches have acquired them over time, often through different contract vehicles and configurations. Spending on such platforms tends to be cyclical, influenced by fleet modernization programs, operational tempo, and budget allocations. A review of historical contract awards for Bell 412 variants and comparable medium utility helicopters would reveal trends in acquisition costs, quantities, and the prevalence of competitive versus sole-source awards over different fiscal years.

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: W58RGZ17R0138

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Textron Inc (UEI: 001338979)

Address: 3255 BELL FLIGHT BLVD, FORT WORTH, TX, 76118

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: $68,301,267

Exercised Options: $54,426,267

Current Obligation: $54,426,267

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline