DoD awards $58.4M for Apache helicopter support to Taiwan, with Boeing as sole provider
Contract Overview
Contract Amount: $58,426,729 ($58.4M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2018-03-30
End Date: 2025-12-15
Contract Duration: 2,817 days
Daily Burn Rate: $20.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: AH-64E APACHE AIRCRAFT FLEET POST PRODUCTION SUPPORT SERVICES IN SUPPORT OF FOREIGN MILITARY SALES CUSTOMER TAIWAN.
Place of Performance
Location: MESA, MARICOPA County, ARIZONA, 85215
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $58.4 million to THE BOEING COMPANY for work described as: AH-64E APACHE AIRCRAFT FLEET POST PRODUCTION SUPPORT SERVICES IN SUPPORT OF FOREIGN MILITARY SALES CUSTOMER TAIWAN. Key points: 1. High value contract for critical defense asset support. 2. Sole-source award to Boeing raises competition concerns. 3. Long-term support contract (2018-2025) indicates ongoing need. 4. Foreign Military Sales customer highlights international defense cooperation.
Value Assessment
Rating: fair
The contract value of $58.4M over 7 years averages to approximately $8.3M annually. Without specific benchmarks for post-production support of advanced attack helicopters, a direct comparison is difficult. However, the firm-fixed-price structure suggests an attempt to control costs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This lack of competition limits price discovery and potentially leads to higher costs for the government and the foreign military sales customer.
Taxpayer Impact: While the direct taxpayer impact is mitigated as this is for a foreign military sale, the lack of competition sets a precedent and could influence future pricing for similar sole-source procurements.
Public Impact
Ensures continued operational readiness of Taiwan's Apache helicopter fleet. Supports U.S. foreign policy objectives through military aid. Maintains critical defense industrial base capabilities for advanced aircraft. Potential for cost overruns due to sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Supports key ally
- Firm-fixed-price contract
Sector Analysis
This contract falls within the aerospace and defense sector, specifically supporting advanced aircraft maintenance and sustainment. Spending in this area is often characterized by high unit costs and long-term support requirements, frequently involving sole-source arrangements due to specialized knowledge and proprietary systems.
Small Business Impact
The prime contractor is The Boeing Company, a large aerospace firm. There is no indication in the provided data that small businesses are involved as subcontractors in this specific contract.
Oversight & Accountability
The contract is managed by the Department of the Army. Oversight would focus on ensuring performance standards are met and that costs remain within the firm-fixed-price ceiling, especially given the sole-source nature.
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 cost creep over contract duration.
- Dependence on a single supplier.
- Lack of transparency in pricing justification.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, az, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $58.4 million to THE BOEING COMPANY. AH-64E APACHE AIRCRAFT FLEET POST PRODUCTION SUPPORT SERVICES IN SUPPORT OF FOREIGN MILITARY SALES CUSTOMER TAIWAN.
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $58.4 million.
What is the period of performance?
Start: 2018-03-30. End: 2025-12-15.
What is the justification for the sole-source award, and were alternative solutions considered?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or essential integration requirements that only one contractor can fulfill. For the AH-64E Apache, Boeing is the original equipment manufacturer, possessing unique technical data and expertise. Alternative solutions might have been explored, but likely deemed impractical or cost-prohibitive compared to leveraging Boeing's established support infrastructure.
How does the pricing compare to similar post-production support contracts for other advanced attack helicopters?
Benchmarking this contract's pricing is challenging without access to proprietary data for comparable systems. However, the firm-fixed-price structure aims to provide cost certainty. The annual average of $8.3M for support services on a high-value asset like the Apache is plausible, but a detailed cost-benefit analysis against alternatives or historical data would be needed for a definitive value assessment.
What are the long-term implications of relying on a sole-source provider for critical aircraft sustainment?
Long-term reliance on a sole-source provider can lead to escalating costs, reduced innovation, and potential supply chain vulnerabilities if the provider faces financial or operational difficulties. It also diminishes the government's (and FMS customer's) leverage in future negotiations. However, for highly specialized systems like advanced military aircraft, it can also ensure consistent, high-quality support critical for operational readiness.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
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
Address: 5000 EAST 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: $79,116,755
Exercised Options: $58,426,729
Current Obligation: $58,426,729
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2018-03-30
Current End Date: 2025-12-15
Potential End Date: 2025-12-15 12:12:00
Last Modified: 2025-07-18
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