Army awards $11.5M contract for aircraft engine overhaul to Honeywell, highlighting specialized manufacturing needs

Contract Overview

Contract Amount: $11,546,672 ($11.5M)

Contractor: Honeywell International Inc.

Awarding Agency: Department of Defense

Start Date: 2025-08-28

End Date: 2026-03-30

Contract Duration: 214 days

Daily Burn Rate: $54.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: OVERHAUL OF ENGINE, AIRCRAFT, TURBO-SHAFT

Place of Performance

Location: PHOENIX, MARICOPA County, ARIZONA, 85034

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $11.5 million to HONEYWELL INTERNATIONAL INC. for work described as: OVERHAUL OF ENGINE, AIRCRAFT, TURBO-SHAFT Key points: 1. Contract addresses critical maintenance for turboshaft engines, ensuring operational readiness. 2. Sole-source award suggests limited market availability or specialized contractor capabilities. 3. Performance period of approximately 1.5 years indicates a focused, short-term maintenance requirement. 4. Firm-fixed-price structure aims to control costs and provide budget certainty. 5. Geographic focus on Arizona for this specific engine overhaul requirement.

Value Assessment

Rating: fair

Benchmarking the value of this engine overhaul contract is challenging without specific details on the scope of work and the exact engine models. However, the $11.5 million figure for a 1.5-year period for specialized aircraft engine maintenance appears within a reasonable range for complex aerospace components. Further analysis would require comparing this to similar overhaul contracts for comparable engine types and assessing the contractor's historical performance and pricing trends.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which is a specific type of sole-source justification. This indicates that while the initial solicitation may have been broad, only one source was ultimately deemed capable of meeting the requirement. This could be due to proprietary technology, unique manufacturing processes, or specialized expertise required for the overhaul of these specific aircraft engines.

Taxpayer Impact: Sole-source awards can limit price competition, potentially leading to higher costs for taxpayers compared to contracts with multiple bidders. However, if only one contractor possesses the necessary capabilities, this approach may be unavoidable to ensure the required maintenance is performed.

Public Impact

The primary beneficiaries are the U.S. Army aviation units relying on these turboshaft engines for their aircraft. The service delivered is the overhaul and repair of critical aircraft engines, ensuring their airworthiness and performance. The geographic impact is centered around the contractor's facility in Arizona, where the work will be performed. Workforce implications include skilled technicians and engineers specializing in aerospace engine maintenance at Honeywell's facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for higher costs due to sole-source nature of the award.
Dependence on a single contractor for critical engine maintenance could pose supply chain risks.
Lack of transparency in the 'exclusion of sources' justification requires careful review.

Positive Signals

Honeywell's established reputation in aerospace manufacturing suggests a high likelihood of quality service.
Firm-fixed-price contract provides cost certainty for the Army.
Specialized nature of the work indicates a focus on critical, high-demand assets.

Sector Analysis

The aircraft engine and engine parts manufacturing sector is a highly specialized and capital-intensive industry. It is characterized by stringent quality control, advanced technology, and significant barriers to entry. This contract falls within the maintenance, repair, and overhaul (MRO) segment of this sector, which is crucial for sustaining military aviation fleets. Spending in this area is often driven by defense readiness requirements and the lifecycle management of complex aerospace systems.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the prime contractor, Honeywell International Inc., is a large aerospace corporation. There is no explicit mention of subcontracting requirements for small businesses within the provided data. Therefore, the direct impact on the small business ecosystem for this specific award is likely minimal, though Honeywell may engage small businesses in its broader supply chain.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of the Army contracting and program management offices. The firm-fixed-price nature of the award provides a degree of financial oversight by establishing a set cost. Transparency regarding the 'exclusion of sources' justification would be key to assessing accountability. Inspector General (IG) jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aircraft Engine Maintenance
Aerospace Manufacturing
Defense Logistics
Turboshaft Engine Overhaul
Military Aviation Support

Risk Flags

Sole-source justification requires careful scrutiny.
Potential for cost overruns due to lack of competition.
Dependence on a single contractor for critical components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.5 million to HONEYWELL INTERNATIONAL INC.. OVERHAUL OF ENGINE, AIRCRAFT, TURBO-SHAFT

Who is the contractor on this award?

The obligated recipient is HONEYWELL INTERNATIONAL INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $11.5 million.

What is the period of performance?

Start: 2025-08-28. End: 2026-03-30.

What is Honeywell's track record with similar aircraft engine overhaul contracts for the Department of Defense?

Honeywell International Inc. has a long and extensive history of providing engines, components, and MRO services to the Department of Defense and other government agencies. They are a major player in the aerospace industry, known for manufacturing and supporting a wide range of aircraft engines, including turboshaft engines used in various military platforms. Their track record typically involves complex maintenance, repair, and overhaul services, often under firm-fixed-price or cost-plus-fixed-fee contracts. While specific performance metrics for past overhaul contracts are not detailed here, Honeywell's sustained presence and significant contract awards suggest a generally positive performance history. However, a deeper dive into contract performance reports (e.g., CPARS) and historical pricing for comparable services would be necessary for a comprehensive assessment.

How does the $11.5 million cost compare to market rates for similar engine overhauls?

Determining the precise market rate for this specific engine overhaul is difficult without knowing the exact engine model, its condition, and the full scope of work included in the 'overhaul.' Aircraft engine overhauls are highly specialized and can vary significantly in cost. Factors such as the number of flight hours, required component replacements, testing procedures, and turnaround time all influence pricing. Generally, turboshaft engine overhauls for military applications can range from hundreds of thousands to several million dollars per engine, depending on complexity. The $11.5 million for this contract, covering an unspecified number of engines over 1.5 years, suggests it might encompass multiple engines or a particularly intensive overhaul process. A direct comparison would require benchmarking against publicly available data for similar military turboshaft engine overhaul contracts or obtaining quotes from other qualified MRO providers if the competition had been more open.

What are the primary risks associated with a sole-source award for critical aircraft engine maintenance?

The primary risk associated with a sole-source award for critical aircraft engine maintenance is the potential for reduced price competition, which can lead to higher costs for the government and taxpayers. Without multiple bidders vying for the contract, the contractor may have less incentive to offer the most competitive pricing. Another risk is the potential for complacency or reduced innovation from the sole provider, as they face no direct competitive pressure. Furthermore, reliance on a single source can create vulnerabilities in the supply chain and increase risks if the contractor experiences production issues, financial instability, or decides to discontinue support for a particular product line. Ensuring robust oversight and performance management becomes even more critical in sole-source situations.

What is the expected program effectiveness and impact of this engine overhaul contract?

The expected program effectiveness hinges on the successful and timely overhaul of the specified aircraft engines by Honeywell. Effective execution of this contract will directly contribute to the operational readiness and safety of the U.S. Army's aviation assets that utilize these turboshaft engines. By ensuring engines are maintained to high standards, the Army can maintain its mission capabilities, whether for troop transport, combat support, or reconnaissance. The impact is the sustained availability of airworthy aircraft, reducing downtime and ensuring that Army units have the necessary equipment to perform their duties. The contract's success will be measured by the quality of the overhauls, adherence to schedule, and the overall reliability of the engines post-service.

How does this contract's value compare to historical spending on aircraft engine maintenance by the Department of the Army?

Comparing this $11.5 million contract to historical spending requires a broader view of the Army's aircraft engine maintenance budget. The Department of the Army operates a vast fleet of aircraft, necessitating significant and ongoing investment in engine maintenance, repair, and overhaul. Annual spending on aviation MRO can easily run into hundreds of millions or even billions of dollars across all platforms. This specific contract represents a portion of that overall expenditure, likely focused on a particular fleet or type of engine. While $11.5 million is a substantial sum for a single contract, it needs to be contextualized within the Army's total aviation maintenance budget. Historical data would show trends in spending for similar engine types and overhaul services, allowing for an assessment of whether this contract's value is consistent with past investments or represents an increase or decrease.

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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: ALTERNATIVE SOURCES

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Honeywell Safety Products USA, Inc.

Address: 111 S 34TH ST, PHOENIX, AZ, 85034

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: $10,305,403

Exercised Options: $10,305,403

Current Obligation: $11,546,672

Subaward Activity

Number of Subawards: 6

Total Subaward Amount: $641,138

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W58RGZ20D0098

IDV Type: IDC

Timeline