DOD Awards $40.7M for 52 AH-64 Engines to General Electric, Sole-Source
Contract Overview
Contract Amount: $40,746,564 ($40.7M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2021-04-29
End Date: 2023-12-31
Contract Duration: 976 days
Daily Burn Rate: $41.7K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: T700 REQUIREMENT: THE PURPOSE OF THIS DELIVERY ORDER W58RGZ-21-F-0304 IS TO PROCURE FIFTY TWO (52) 701D AH-64 ENGINES IN SUPPORT OF MOROCCO PROGRAM, FOR CY 2023 DELIVERIES IN ACCORDANCE WITH CONTRACT CLAUSES H-3, DELIVERY ORDER - ENGINES.
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $40.7 million to GENERAL ELECTRIC COMPANY for work described as: T700 REQUIREMENT: THE PURPOSE OF THIS DELIVERY ORDER W58RGZ-21-F-0304 IS TO PROCURE FIFTY TWO (52) 701D AH-64 ENGINES IN SUPPORT OF MOROCCO PROGRAM, FOR CY 2023 DELIVERIES IN ACCORDANCE WITH CONTRACT CLAUSES H-3, DELIVERY ORDER - ENGINES. Key points: 1. Procurement of 52 AH-64 engines for the Morocco Program. 2. Contract awarded to General Electric Company. 3. Sole-source award raises questions about price discovery. 4. Spending falls within the Aircraft Engine Manufacturing sector.
Value Assessment
Rating: fair
The total award is $40.7 million for 52 engines. This averages to approximately $783,587 per engine. Benchmarking against similar military engine contracts is difficult without more specific data on engine model and configuration.
Cost Per Unit: $783,587
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. Without competition, there is a risk that the price may not reflect the best value achievable, as there was no market pressure to drive down costs.
Taxpayer Impact: Taxpayers may have paid a premium due to the lack of competitive bidding on this significant engine procurement.
Public Impact
Ensures operational readiness of AH-64 helicopters for a partner nation. Supports critical defense supply chains for aviation components. Potential for higher costs due to sole-source award impacts taxpayer funds. Highlights reliance on specific manufacturers for specialized defense equipment.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition.
- Lack of detailed cost breakdown.
- Long contract duration with potential for cost overruns.
Positive Signals
- Supports critical military aircraft.
- Procurement for a partner nation program.
- Firm fixed price contract provides cost certainty.
Sector Analysis
This spending falls within the Aircraft Engine and Engine Parts Manufacturing sector, a specialized area often dominated by a few key players. Benchmarks for similar military-grade engines can vary significantly based on technology and specific requirements.
Small Business Impact
This contract was awarded to General Electric Company, a large business. There is no indication of subcontracting opportunities for small businesses within the provided data.
Oversight & Accountability
The award was issued as a delivery order against an existing contract. Oversight would focus on ensuring timely delivery, adherence to specifications, and proper financial management throughout the contract period.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award
- Potential for inflated pricing
- Lack of transparency in justification
- Long contract performance period
- Dependence on a single supplier
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ma, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $40.7 million to GENERAL ELECTRIC COMPANY. T700 REQUIREMENT: THE PURPOSE OF THIS DELIVERY ORDER W58RGZ-21-F-0304 IS TO PROCURE FIFTY TWO (52) 701D AH-64 ENGINES IN SUPPORT OF MOROCCO PROGRAM, FOR CY 2023 DELIVERIES IN ACCORDANCE WITH CONTRACT CLAUSES H-3, DELIVERY ORDER - ENGINES.
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC 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 $40.7 million.
What is the period of performance?
Start: 2021-04-29. End: 2023-12-31.
What is the justification for the sole-source award, and was any market research conducted to confirm the necessity of this approach?
The provided data states the contract was 'NOT COMPETED,' implying a sole-source justification. A thorough review would require access to the contract file to understand the specific reasons, such as unique capabilities or urgent needs, and to verify if market research was performed to ensure no other sources could meet the requirement.
How does the per-unit cost of these AH-64 engines compare to historically procured engines of similar specifications?
The calculated per-unit cost is approximately $783,587. Without access to historical procurement data for identical or comparable AH-64 engine models and configurations, a precise comparison is not possible. Factors like technological upgrades, inflation, and specific contract terms significantly influence pricing.
What are the potential risks associated with relying on a single supplier for such critical aviation components, particularly in a sole-source scenario?
Sole-source reliance on General Electric for these critical AH-64 engines presents risks including potential price inflation due to lack of competition, vulnerability to supply chain disruptions affecting only one provider, and reduced leverage for the government in negotiating future contracts or modifications.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: ENGINES AND TURBINES AND COMPONENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1000 WESTERN AVE, LYNN, MA, 01905
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $40,746,564
Exercised Options: $40,746,564
Current Obligation: $40,746,564
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W58RGZ15D0048
IDV Type: IDC
Timeline
Start Date: 2021-04-29
Current End Date: 2023-12-31
Potential End Date: 2023-12-31 00:00:00
Last Modified: 2025-04-26
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