Boeing awarded $76M task order for engineering services to support UAE, under a sole-source ID/IQ contract

Contract Overview

Contract Amount: $75,957,767 ($76.0M)

Contractor: THE Boeing Company

Awarding Agency: Department of Defense

Start Date: 2020-08-01

End Date: 2029-10-31

Contract Duration: 3,378 days

Daily Burn Rate: $22.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: U.S. ARMY CONTRACTING COMMAND - REDSTONE ARSENAL AWARDS TASK ORDER W58RGZ-20-F-0460 IN SUPPORT OF THE UNITED ARAB EMIRATES (UAE), UNDER INDEFINITE DELIVERY/INDEFINITE QUANTITY (ID/IQ) CONTRACT W58RGZ-20-D-0005 TO THE BOEING COMPANY.

Place of Performance

Location: MESA, MARICOPA County, ARIZONA, 85212

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $76.0 million to THE BOEING COMPANY for work described as: U.S. ARMY CONTRACTING COMMAND - REDSTONE ARSENAL AWARDS TASK ORDER W58RGZ-20-F-0460 IN SUPPORT OF THE UNITED ARAB EMIRATES (UAE), UNDER INDEFINITE DELIVERY/INDEFINITE QUANTITY (ID/IQ) CONTRACT W58RGZ-20-D-0005 TO THE BOEING COMPANY. Key points: 1. Task order awarded under an existing ID/IQ contract, suggesting a pre-established relationship and potentially streamlined procurement. 2. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 3. The duration of the task order is substantial, spanning over 8 years, indicating a long-term need for these services. 4. The award is for engineering services, a critical component for complex defense and aerospace projects. 5. The support is for the United Arab Emirates, highlighting international defense cooperation and sales. 6. The contract was not available for competition, raising questions about potential cost efficiencies and market engagement.

Value Assessment

Rating: fair

The total value of $75.96 million for engineering services over nearly 9 years suggests a significant investment. Benchmarking this specific task order's value is challenging without detailed scope of work and comparison to similar international support contracts. However, the firm-fixed-price nature is a positive indicator for cost control, provided the initial scope was well-defined. The absence of competition limits the ability to assess if the pricing is truly market-competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This task order was awarded under an existing ID/IQ contract (W58RGZ-20-D-0005) and was not available for competition. This indicates that the procurement strategy relied on a pre-selected vendor, likely Boeing, for these specific engineering services. The lack of a competitive bidding process means that multiple potential suppliers were not evaluated, which can limit price discovery and potentially lead to higher costs than if the contract had been competed.

Taxpayer Impact: Taxpayers may not be receiving the best possible price due to the absence of a competitive bidding process. Without competing the requirement, there is less pressure on the contractor to offer the most cost-effective solution.

Public Impact

The primary beneficiary is the United Arab Emirates, receiving critical engineering support for its defense or aerospace needs. The services delivered are engineering-focused, likely encompassing design, development, testing, or sustainment of complex systems. The geographic impact is primarily in the UAE, though the contract is managed by the U.S. Army Contracting Command. Workforce implications include potential employment for engineers and technical specialists within The Boeing Company.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in suboptimal pricing for taxpayers.
Long contract duration (over 8 years) increases the risk of scope creep or unforeseen cost increases if not managed tightly.
Sole-source awards can limit opportunities for emerging or smaller businesses to participate.

Positive Signals

Firm Fixed Price contract type shifts cost risk to the contractor.
Awarded under an existing ID/IQ contract, suggesting a streamlined process and potentially leveraging established relationships.
Engineering services are crucial for advanced technological support, indicating a focus on critical capabilities.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), which is a significant part of the broader aerospace and defense industry. The market for specialized engineering services supporting international defense partners is substantial, driven by global security needs and technological advancements. The Boeing Company is a major player in this sector, known for its extensive capabilities in aircraft, space, and defense systems. This award represents a portion of the overall spending within this specialized niche, where long-term support and technical expertise are highly valued.

Small Business Impact

The contract data indicates that small business participation (ss and sb fields) is false, suggesting this large task order was not specifically set aside for small businesses. Consequently, there are no direct subcontracting implications for small businesses stemming from this award itself. The absence of a small business set-aside means that opportunities for small businesses to compete for this specific work are limited, potentially impacting the small business ecosystem if this type of work is frequently awarded on a sole-source basis.

Oversight & Accountability

Oversight for this contract would primarily fall under the U.S. Army Contracting Command - Redstone Arsenal, which awarded the task order. As a Department of Defense contract, it is subject to internal DoD oversight mechanisms and potentially the Defense Contract Audit Agency (DCAA) for financial audits. Transparency is limited due to the sole-source nature, but contract awards are generally reported in federal procurement databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Foreign Military Sales (FMS)
Defense Engineering Services
Aerospace and Defense Contracts
Indefinite Delivery/Indefinite Quantity (ID/IQ) Contracts
International Security Cooperation

Risk Flags

Sole-source award limits price competition.
Long contract duration increases risk exposure.
Lack of specific service details hinders full assessment.
International support adds geopolitical complexity.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $76.0 million to THE BOEING COMPANY. U.S. ARMY CONTRACTING COMMAND - REDSTONE ARSENAL AWARDS TASK ORDER W58RGZ-20-F-0460 IN SUPPORT OF THE UNITED ARAB EMIRATES (UAE), UNDER INDEFINITE DELIVERY/INDEFINITE QUANTITY (ID/IQ) CONTRACT W58RGZ-20-D-0005 TO THE BOEING COMPANY.

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 $76.0 million.

What is the period of performance?

Start: 2020-08-01. End: 2029-10-31.

What is the historical spending pattern for The Boeing Company with the U.S. Army Contracting Command - Redstone Arsenal under ID/IQ contracts?

Analyzing historical spending patterns for The Boeing Company with the U.S. Army Contracting Command - Redstone Arsenal under ID/IQ contracts requires access to comprehensive federal procurement data. While this specific task order (W58RGZ-20-F-0460) represents a significant award of approximately $76 million, understanding the broader trend involves examining all contracts awarded to Boeing by this specific contracting command over time. Factors to consider include the volume and value of contracts, the types of services or products procured, and whether these awards were competed or sole-sourced. Without a detailed historical analysis, it's difficult to ascertain if this award is typical, an outlier, or indicative of a growing reliance on Boeing for specific support requirements. Such analysis would inform whether the current award aligns with past procurement strategies or represents a shift in focus or vendor dependency.

How does the $75.96 million value of this task order compare to other engineering services contracts awarded by the Department of Defense to international partners?

The $75.96 million value of this task order is substantial for engineering services, particularly when supporting an international partner like the UAE. To benchmark this value effectively, one would need to compare it against similar contracts awarded by the Department of Defense (DoD) for engineering support to foreign governments. This comparison should ideally account for the scope of services, the duration of the contract (nearly 9 years in this case), and the specific technological complexity involved. Larger, multi-year contracts for complex defense systems or infrastructure development can easily reach or exceed this figure. However, for standard engineering support, $76 million over this period might be considered high, especially if the competition was limited. A detailed analysis would involve identifying comparable contracts, adjusting for inflation and scope differences, and assessing the competitive landscape at the time of award.

What are the specific engineering services being provided to the UAE under this contract, and what is the risk associated with their delivery?

The provided data indicates the contract is for 'Engineering Services' (NAICS 541330) but does not specify the exact nature of these services. Given the context of a Department of the Army award supporting the UAE, these services likely pertain to defense systems, aerospace technology, or related infrastructure. Potential risks associated with delivering complex engineering services include technical challenges, integration issues with existing systems, schedule delays, and cost overruns (though mitigated by the FFP nature). For international support, geopolitical factors, differing technical standards, and communication barriers can add further layers of risk. The long duration of the task order (until October 2029) increases the potential for these risks to materialize if not proactively managed through robust project management, clear communication channels, and contingency planning.

Given the sole-source nature of this award, what mechanisms are in place to ensure accountability and prevent potential overpricing?

The sole-source nature of this award, awarded under an existing ID/IQ contract, bypasses the typical competitive bidding process designed to ensure price discovery and accountability. Accountability mechanisms in such cases often rely on pre-negotiated terms within the ID/IQ contract, stringent oversight by the contracting agency (U.S. Army Contracting Command - Redstone Arsenal), and potentially audits by the Defense Contract Audit Agency (DCAA). The Firm Fixed Price (FFP) contract type shifts the financial risk of cost overruns to the contractor, Boeing, which incentivizes them to manage costs effectively. However, preventing overpricing without competition is challenging. Agencies may use historical pricing data, should-cost analyses, or independent government cost estimates to validate the reasonableness of the proposed price. Transparency is limited, but contract award data is publicly available, allowing for some level of scrutiny.

What is the strategic importance of providing engineering services to the UAE, and how does this contract align with broader U.S. foreign policy objectives?

Providing specialized engineering services to the United Arab Emirates (UAE) under this contract likely aligns with broader U.S. foreign policy objectives related to regional security, defense cooperation, and maintaining stability in the Middle East. The UAE is a key strategic partner for the U.S., and supporting its defense capabilities can enhance interoperability and collective security efforts. The nature of engineering services suggests support for advanced military platforms or systems, potentially including aircraft, missile defense, or communication systems. By providing this technical expertise, the U.S. aims to bolster the UAE's self-defense capabilities, thereby contributing to deterrence and counter-terrorism efforts in the region. This contract can also be seen as a component of the U.S.'s security assistance framework, reinforcing alliances and promoting U.S. defense industry engagement abroad.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

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: $75,957,767

Exercised Options: $75,957,767

Current Obligation: $75,957,767

Subaward Activity

Number of Subawards: 39

Total Subaward Amount: $3,554,052

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W58RGZ20D0005

IDV Type: IDC

Timeline