DoD awards $37.6M construction contract for aviation facility in Honduras

Contract Overview

Contract Amount: $37,641,631 ($37.6M)

Contractor: Empresa DE Construccion Y Transporte Eterna S.A. DE C.V.

Awarding Agency: Department of Defense

Start Date: 2025-09-08

End Date: 2028-07-04

Contract Duration: 1,030 days

Daily Burn Rate: $36.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DESIGN-BID-BUILD (DBB) CONSTRUCTION CONTRACT USING FULL AND OPEN COMPETITION FOR THE CONSTRUCTION OF AN AVIATION STORAGE FACILITY FOR USE BY U.S. FORCES LOCATED AT SOTO CANO AIR BASE IN HONDURAS.

Plain-Language Summary

Department of Defense obligated $37.6 million to EMPRESA DE CONSTRUCCION Y TRANSPORTE ETERNA S.A. DE C.V. for work described as: DESIGN-BID-BUILD (DBB) CONSTRUCTION CONTRACT USING FULL AND OPEN COMPETITION FOR THE CONSTRUCTION OF AN AVIATION STORAGE FACILITY FOR USE BY U.S. FORCES LOCATED AT SOTO CANO AIR BASE IN HONDURAS. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The firm-fixed-price contract type aims to control costs for the government. 3. The project involves constructing an aviation storage facility for U.S. Forces in Honduras. 4. The contract duration is over 1000 days, indicating a significant construction undertaking. 5. The awarded amount is within the typical range for large-scale international construction projects. 6. The contractor, Empresa de Construccion y Transporte Eterna S.A. de C.V., is a foreign entity.

Value Assessment

Rating: fair

The contract value of $37.6 million for an aviation storage facility appears reasonable given the project's scope and international location. Benchmarking against similar international construction projects for military infrastructure is challenging due to unique logistical and security considerations. However, the firm-fixed-price structure provides cost certainty. The price per square foot or per unit of storage capacity would be a more granular metric for value assessment, but this data is not provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded using full and open competition, indicating that all responsible sources were permitted to submit bids. The number of bidders is not specified, but this method generally fosters a competitive environment, which can lead to better pricing and value for the government. The open competition suggests that the Department of Defense sought the most advantageous offer based on price and other factors.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically drives down costs through market forces, ensuring that the government receives competitive pricing and avoids potential overpayments associated with less competitive procurement methods.

Public Impact

U.S. Forces operating in Honduras will benefit from improved aviation storage capabilities. The construction project will create temporary employment opportunities in Honduras. The facility will enhance operational readiness and logistical support for military aviation assets. The project contributes to the U.S. military's infrastructure development in strategic international locations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions or logistical challenges arise in Honduras.
Reliance on a single foreign contractor may present unique oversight and quality control challenges.
Geopolitical instability in the region could impact project timelines and security.
Currency exchange rate fluctuations could affect the final cost if payments are not fixed in USD.

Positive Signals

Firm-fixed-price contract provides cost certainty and limits the government's exposure to cost increases.
Full and open competition suggests a robust process for selecting the most qualified and cost-effective bidder.
The contractor has been awarded a definitive contract, implying a thorough vetting process.
The project aims to enhance critical military infrastructure, supporting national security objectives.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector. The global market for military construction is substantial, driven by defense spending and geopolitical needs. Projects like this, involving specialized facilities in international locations, often command higher costs due to logistical complexities, security requirements, and the need for specialized expertise. Comparable spending benchmarks are difficult to establish precisely without more detailed project specifications and location-specific cost data.

Small Business Impact

This contract does not appear to have a small business set-aside. Given the nature and location of the project, it is unlikely that significant subcontracting opportunities would be directed towards U.S. small businesses, though local Honduran small businesses might be engaged by the prime contractor. The absence of a set-aside means the competition was open to all responsible contractors, regardless of size.

Oversight & Accountability

Oversight will likely be managed by the Department of the Army, potentially through a contracting officer's representative (COR) on-site or through regional contracting commands. Accountability measures are embedded in the firm-fixed-price contract terms, with penalties for non-performance or delays. Transparency is generally maintained through contract award announcements and reporting requirements, though specific details of ongoing oversight may not be publicly disclosed.

Related Government Programs

Military Construction, Army
Foreign Military Construction
Aviation Infrastructure Projects
Department of Defense Facilities

Risk Flags

International Logistics Complexity
Geopolitical Risk
Contractor Performance Risk (Foreign Entity)
Site-Specific Conditions Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.6 million to EMPRESA DE CONSTRUCCION Y TRANSPORTE ETERNA S.A. DE C.V.. DESIGN-BID-BUILD (DBB) CONSTRUCTION CONTRACT USING FULL AND OPEN COMPETITION FOR THE CONSTRUCTION OF AN AVIATION STORAGE FACILITY FOR USE BY U.S. FORCES LOCATED AT SOTO CANO AIR BASE IN HONDURAS.

Who is the contractor on this award?

The obligated recipient is EMPRESA DE CONSTRUCCION Y TRANSPORTE ETERNA S.A. DE C.V..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $37.6 million.

What is the period of performance?

Start: 2025-09-08. End: 2028-07-04.

What is the track record of Empresa de Construccion y Transporte Eterna S.A. de C.V. with U.S. government contracts?

Information regarding the specific track record of Empresa de Construccion y Transporte Eterna S.A. de C.V. with U.S. government contracts is not readily available in the provided data. Further research would be required to ascertain their past performance, including any previous contracts awarded by the Department of Defense or other federal agencies, their successful completion rates, and any history of disputes or contract terminations. This information is crucial for assessing the contractor's reliability and capability to execute the current project successfully.

How does the awarded price compare to similar international aviation facility construction projects?

Direct comparison of the $37.6 million award to similar international aviation facility construction projects is challenging without more specific project details (e.g., square footage, capacity, specific features) and comprehensive market data for construction costs in Honduras and comparable regions. International projects often incur higher costs due to logistics, security, and specialized labor requirements. The firm-fixed-price nature of this contract suggests an effort to cap costs, but a detailed cost-benefit analysis would require benchmarking against projects with similar scope, complexity, and location-specific economic factors.

What are the primary risks associated with constructing a military facility in Honduras?

Key risks associated with constructing a military facility in Honduras include geopolitical instability, potential security threats to personnel and materials, logistical challenges in transporting equipment and supplies to the site, and the possibility of unforeseen environmental or geological conditions. Additionally, reliance on a foreign contractor may introduce complexities in oversight, quality assurance, and adherence to U.S. standards. Currency fluctuations and local labor regulations also present potential risks that could impact project timelines and budget if not managed effectively.

How effective is the firm-fixed-price contract type in managing costs for this project?

The firm-fixed-price (FFP) contract type is generally effective in managing costs for projects where the scope of work is well-defined, as it shifts the risk of cost overruns to the contractor. For this aviation storage facility construction, the FFP structure provides the Department of Defense with cost certainty, as the contractor is obligated to complete the work for the agreed-upon price. However, the effectiveness can be diminished if the initial scope is underestimated or if significant unforeseen issues arise, potentially leading to change orders that could increase the total cost.

What is the historical spending pattern for aviation infrastructure at Soto Cano Air Base?

The provided data does not include historical spending patterns for aviation infrastructure specifically at Soto Cano Air Base. To assess this, one would need to analyze past Department of Defense contracts awarded for construction, maintenance, or upgrades of aviation facilities at this specific location. Understanding historical spending would help contextualize the current $37.6 million award, indicating whether it represents a significant increase or decrease in investment for such infrastructure and identifying any trends in project costs or frequency.

What are the implications of awarding this contract to a foreign entity for U.S. taxpayers?

Awarding this contract to a foreign entity, Empresa de Construccion y Transporte Eterna S.A. de C.V., has several implications for U.S. taxpayers. While full and open competition aims for the best value, using a foreign contractor may mean less direct economic benefit to the U.S. economy compared to awarding to a domestic firm. However, it ensures that the contract is awarded based on merit and price, potentially leading to cost savings. Oversight and ensuring compliance with U.S. standards and ethical practices become critical to protect taxpayer interests.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W9127825RA005

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: KM 1 CARRETERA A OCCIDENTE SAN PEDRO SULA, CR 1428, SAN PEDRO SULA

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $37,641,631

Exercised Options: $37,641,631

Current Obligation: $37,641,631

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Timeline