DoD's $68.9M T-45 Aircraft Logistics Support Contract Awarded to Vertex Aerospace LLC

Contract Overview

Contract Amount: $68,853,306 ($68.9M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2014-03-31

End Date: 2019-09-30

Contract Duration: 2,009 days

Daily Burn Rate: $34.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CONTRACTOR LOGISTICS SUPPORT FOR T-45 AIRCRAFT AT NAS KINGSVILLE, TX, NAS MERIDIAN, MS AND NAS PENSACOLA, FL.

Place of Performance

Location: MADISON, MADISON County, MISSISSIPPI, 39110

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $68.9 million to VERTEX AEROSPACE LLC for work described as: CONTRACTOR LOGISTICS SUPPORT FOR T-45 AIRCRAFT AT NAS KINGSVILLE, TX, NAS MERIDIAN, MS AND NAS PENSACOLA, FL. Key points: 1. Contract awarded on a sole-source basis, raising questions about potential overpayment and lack of competitive pressure. 2. Significant duration of the contract (over 5 years) suggests a long-term need for these services. 3. The contract's value, while substantial, needs benchmarking against similar logistics support contracts for aircraft. 4. Performance context is crucial to understand if Vertex Aerospace met delivery expectations and quality standards. 5. Sector positioning within 'Other Support Activities for Air Transportation' highlights a niche but critical support function. 6. Lack of small business set-aside indicates potential missed opportunities for smaller firms in this sector.

Value Assessment

Rating: fair

The contract's total value of approximately $68.9 million over five years averages to about $13.8 million annually. Without specific performance metrics or comparable contract data, it's difficult to definitively assess value for money. However, the absence of competition suggests that pricing may not have been subjected to market pressures, potentially leading to higher costs than if it were competed. Benchmarking against similar logistics support contracts for military aircraft would be necessary for a more robust evaluation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when only one vendor possesses the necessary capabilities, proprietary technology, or when urgent needs preclude a competitive process. The lack of competition limits the government's ability to explore alternative solutions or secure the most cost-effective pricing through bidding.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as there is no competitive pressure to drive down prices. This contract's value could potentially be higher than if it had been subject to a competitive bidding process.

Public Impact

The primary beneficiaries are the U.S. Navy and Marine Corps, who rely on the T-45 aircraft for training. Services delivered include essential logistics support, ensuring the operational readiness of the T-45 fleet. Geographic impact is concentrated at Naval Air Stations Kingsville, Meridian, and Pensacola, supporting training operations at these key locations. Workforce implications include employment opportunities for personnel involved in aircraft maintenance, supply chain management, and technical support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Lack of competition may reduce incentives for the contractor to innovate or improve service efficiency.
Long contract duration without clear performance benchmarks could mask inefficiencies.
Absence of small business participation may limit broader economic impact and opportunities.

Positive Signals

Ensures continuity of critical logistics support for T-45 aircraft training.
Vertex Aerospace LLC likely possesses specialized knowledge or capabilities for this specific aircraft.
Fixed-price contract structure can provide cost certainty for the government, assuming scope is well-defined.

Sector Analysis

The aerospace and defense industry is characterized by high barriers to entry, complex supply chains, and significant government reliance. Logistics support for military aircraft is a specialized segment within this sector, often requiring deep technical expertise and security clearances. The market for such services can be concentrated, with a few key players dominating specific aircraft platforms. This contract fits within the broader defense logistics and support services market, which is a substantial component of overall defense spending.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have significant subcontracting requirements for small businesses based on the provided data. This represents a missed opportunity to engage smaller, specialized firms in the defense logistics ecosystem. The absence of small business participation could limit the broader economic benefits and the development of a more diverse supplier base within this critical sector.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures would be defined in the contract's terms and conditions, including delivery schedules and quality standards. Transparency is often limited in sole-source procurements, but contract award details are generally made public. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

T-45 Goshawk Aircraft
Naval Air Training Command
Aerospace Logistics Support
Defense Contract Services
Military Aircraft Maintenance

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns
Limited transparency
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $68.9 million to VERTEX AEROSPACE LLC. CONTRACTOR LOGISTICS SUPPORT FOR T-45 AIRCRAFT AT NAS KINGSVILLE, TX, NAS MERIDIAN, MS AND NAS PENSACOLA, FL.

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $68.9 million.

What is the period of performance?

Start: 2014-03-31. End: 2019-09-30.

What is Vertex Aerospace LLC's track record with similar sole-source contracts, particularly for military aircraft logistics?

Vertex Aerospace LLC has a history of performing various aviation support services. Information regarding their specific track record with sole-source contracts for military aircraft logistics, especially concerning the T-45, would require a deeper dive into contract databases and performance reports. Analyzing past performance on similar contracts, including any issues or commendations, is crucial for assessing their reliability and capability in fulfilling this specific requirement. Without detailed performance data, it's challenging to definitively gauge their expertise and past success in managing complex logistics operations under sole-source conditions.

How does the pricing of this contract compare to industry benchmarks for similar aircraft logistics support services?

Benchmarking the pricing of this $68.9 million contract against industry standards is challenging without access to detailed cost breakdowns and comparable contract data. Sole-source awards inherently lack the price discovery mechanism of competition. To assess value, one would need to compare the per-unit costs of specific services (e.g., maintenance hours, parts provisioning) against market rates for similar platforms or against historical data for the T-45 program if available. The absence of competition suggests that the government may not have secured the most competitive pricing possible, making external benchmarking even more critical.

What are the primary risk indicators associated with this sole-source contract award?

The primary risk indicator is the sole-source nature of the award, which significantly reduces competitive pressure. This can lead to inflated pricing, reduced incentive for efficiency, and potentially less favorable contract terms. Other risks include potential contractor performance issues if capabilities are not as robust as assumed, and the long duration of the contract (over 5 years) which could lock the government into a suboptimal arrangement if market conditions or needs change. Dependency on a single provider also poses a supply chain risk.

How effective has Vertex Aerospace LLC been in delivering logistics support for the T-45 aircraft under this contract?

Assessing the effectiveness of Vertex Aerospace LLC's performance requires access to specific contract performance metrics, such as on-time delivery rates, quality of service, aircraft availability, and user feedback from the Navy. Publicly available data often lacks this granular detail. A thorough analysis would involve reviewing DCMA performance reports, any Contractor Performance Assessment Reporting System (CPARS) data, and feedback from the end-users at NAS Kingsville, Meridian, and Pensacola. Without this, effectiveness remains an assumption based on the contract's continuation.

What are the historical spending patterns for T-45 aircraft logistics support, and how does this contract compare?

Historical spending patterns for T-45 aircraft logistics support would reveal the total investment over time and how this $68.9 million contract fits into that trend. Analyzing previous contracts, including their values, durations, and whether they were competed, provides context. If previous support was provided under competitive contracts at lower overall costs or for shorter durations, this sole-source award might represent a deviation or an increase in expenditure. Understanding the evolution of spending can highlight changes in program requirements, market dynamics, or procurement strategies.

What is the potential impact of this sole-source award on future competition for T-45 logistics support?

A sole-source award can have a chilling effect on future competition. Incumbent contractors may gain significant advantages due to institutional knowledge, established relationships, and proprietary data, making it difficult for new entrants to compete effectively. If Vertex Aerospace has heavily invested in infrastructure and processes specific to this contract, it could create high switching costs for the government. This might lead to continued sole-source awards or limited competition in the future, unless the government actively seeks to foster a more competitive environment through market research and strategic procurement planning.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0001913R0089

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Vertex Aerospace Services Corp. (UEI: 081292432)

Address: 555 INDUSTRIAL DR S, MADISON, MS, 39110

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $68,853,306

Exercised Options: $68,853,306

Current Obligation: $68,853,306

Subaward Activity

Number of Subawards: 7

Total Subaward Amount: $423,153

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001914D0019

IDV Type: IDC

Timeline