DoD's $32M Rotor Turbine Aircraft Deal with GE Raises Questions on Competition and Value
Contract Overview
Contract Amount: $31,968,905 ($32.0M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2011-01-31
End Date: 2014-09-30
Contract Duration: 1,338 days
Daily Burn Rate: $23.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: ROTOR TURBINE AIRCRAFT
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $32.0 million to GENERAL ELECTRIC COMPANY for work described as: ROTOR TURBINE AIRCRAFT Key points: 1. Significant contract value of $31.97 million awarded to General Electric. 2. Lack of competition raises concerns about potential overpricing and limited market exploration. 3. The 'NOT COMPETED' status is a key risk factor for taxpayer value. 4. Spending falls within the broad 'Defense' sector, specifically aircraft engine parts manufacturing.
Value Assessment
Rating: questionable
Without competitive bidding, it's difficult to assess if the $31.97 million price reflects fair market value. The absence of comparison data makes a precise valuation challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competition means taxpayers may have paid more than necessary for these rotor turbine aircraft components.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The Department of Defense relies on critical aircraft parts, making supply chain transparency important. This contract highlights potential vulnerabilities in sole-source procurement processes within the defense sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potential for overpricing
- Limited transparency
Positive Signals
- Awarded to a major manufacturer (GE)
- Firm Fixed Price contract type can limit cost overruns
Sector Analysis
This contract falls under the Defense sector, specifically for aircraft engine and engine parts manufacturing. Spending in this area is critical for military readiness but requires careful oversight to ensure cost-effectiveness.
Small Business Impact
The data does not indicate any involvement of small businesses in this contract, suggesting a focus on large prime contractors for this specific procurement.
Oversight & Accountability
The 'NOT COMPETED' status warrants further investigation by oversight bodies to ensure the government received fair value and that the sole-source justification was sound.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award
- Lack of competitive pricing
- Potential for inflated costs
- Limited transparency in pricing
- Dependency on a single supplier
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ma, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $32.0 million to GENERAL ELECTRIC COMPANY. ROTOR TURBINE AIRCRAFT
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $32.0 million.
What is the period of performance?
Start: 2011-01-31. End: 2014-09-30.
What was the justification for not competing this contract, and was it adequately documented?
The justification for not competing this contract is not provided in the data. Typically, sole-source awards require rigorous documentation demonstrating why competition was not feasible or advantageous. Oversight agencies would likely scrutinize the rationale to ensure it aligns with procurement regulations and serves the government's best interest.
How does the unit cost of these rotor turbine aircraft components compare to similar procurements, if any data exists?
Without competitive bids or publicly available benchmark data for identical or comparable rotor turbine aircraft components, it is impossible to establish a reliable unit cost comparison. The lack of competition inherently hinders the ability to benchmark pricing against market alternatives, making it difficult to assess cost-effectiveness.
What is the potential impact on aircraft readiness if this sole-source supplier faces disruptions?
A sole-source reliance for critical rotor turbine aircraft components poses a significant risk to aircraft readiness. Any disruption in supply from General Electric, whether due to production issues, geopolitical factors, or other unforeseen events, could lead to extended aircraft downtime and operational limitations for the Department of Defense.
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
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1000 WESTERN AVE, LYNN, MA, 06
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $31,968,905
Exercised Options: $31,968,905
Current Obligation: $31,968,905
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W58RGZ09D0041
IDV Type: IDC
Timeline
Start Date: 2011-01-31
Current End Date: 2014-09-30
Potential End Date: 2014-09-30 00:00:00
Last Modified: 2012-06-18
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