DoD's $31.7M Simmonds Precision IVHMS Kits Contract Awarded Without Competition
Contract Overview
Contract Amount: $31,706,018 ($31.7M)
Contractor: Simmonds Precision Products Inc
Awarding Agency: Department of Defense
Start Date: 2008-08-27
End Date: 2012-05-30
Contract Duration: 1,372 days
Daily Burn Rate: $23.1K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: PROCUREMENT OF IVHMS KITS, GSE KITS, AND DEPLOYMENT SPARES UNDER IDIQ CONTRACT.
Place of Performance
Location: VERGENNES, ADDISON County, VERMONT, 05491, UNITED STATES OF AMERICA
State: Vermont Government Spending
Plain-Language Summary
Department of Defense obligated $31.7 million to SIMMONDS PRECISION PRODUCTS INC for work described as: PROCUREMENT OF IVHMS KITS, GSE KITS, AND DEPLOYMENT SPARES UNDER IDIQ CONTRACT. Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential value for money. 2. The contract's duration of 1372 days suggests a long-term need for these specialized aircraft parts. 3. Lack of competition may limit opportunities for other suppliers and potentially lead to higher costs. 4. The firm-fixed-price structure aims to transfer some cost risk to the contractor. 5. This procurement falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' NAICS code. 6. The contract was managed by the Defense Contract Management Agency.
Value Assessment
Rating: questionable
Without a competitive bidding process, it is difficult to benchmark the value for money on this $31.7 million contract. The sole-source award means there was no direct comparison of pricing from multiple vendors. While the firm-fixed-price contract type can provide cost certainty, the absence of competition raises concerns about whether the government secured the best possible price. Further analysis would require access to internal cost estimates or historical pricing data for similar IVHMS kits.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Simmonds Precision Products Inc., was solicited. The justification for not competing this requirement is not provided in the data. This lack of competition limits the government's ability to explore alternative solutions or leverage market dynamics to achieve lower prices. It suggests that either Simmonds Precision was the only known source, or there were specific circumstances justifying a non-competitive award.
Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. Without multiple bids, there's a risk that the price was not optimized, leading to less efficient use of public funds.
Public Impact
The primary beneficiaries are likely military aviation units requiring IVHMS (Integrated Vehicle Health Management System) kits and related spares for operational readiness. The services delivered include the provision of critical aircraft components and deployment spares, essential for maintaining complex aircraft systems. The geographic impact is likely global, supporting deployed military assets wherever these aircraft are operated. Workforce implications are primarily within Simmonds Precision Products Inc. and its supply chain, maintaining specialized manufacturing capabilities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition and potentially increases costs for taxpayers.
- Lack of transparency regarding the justification for sole-source procurement.
- Long contract duration without competitive re-evaluation could lead to price stagnation.
- No indication of small business subcontracting goals or performance.
- Limited insight into the specific performance metrics or quality assurance beyond contract type.
Positive Signals
- Firm-fixed-price contract provides cost certainty for the government.
- Award to an established entity (Simmonds Precision Products Inc.) may indicate reliability in supply.
- Contract managed by Defense Contract Management Agency suggests oversight is in place.
- Procurement of essential aircraft parts supports military readiness.
Sector Analysis
This contract falls within the aerospace manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. The market for such specialized components is often characterized by high barriers to entry due to technical expertise, certifications, and established relationships with defense contractors. Spending in this area is critical for maintaining aging military fleets and ensuring operational readiness. Comparable spending benchmarks would typically involve analyzing other sole-source or competitively awarded contracts for similar aircraft systems or components within the Department of Defense.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false) and there is no specific mention of small business subcontracting (sb: false). This suggests that the prime contractor, Simmonds Precision Products Inc., was expected to fulfill the requirement directly or through its own supply chain, without a specific mandate to engage small businesses. Consequently, there are no direct subcontracting implications for the small business ecosystem stemming from this particular award, and no direct benefit to small businesses through set-asides.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency (DCMA), which is responsible for overseeing contract performance and ensuring compliance. The firm-fixed-price (FFP) contract type shifts some financial risk to the contractor, Simmonds Precision Products Inc. However, the lack of competition limits the oversight effectiveness in terms of price reasonableness. Transparency regarding the justification for the sole-source award would enhance accountability. Inspector General jurisdiction would typically apply to investigations of fraud, waste, or abuse related to the contract.
Related Government Programs
- Aircraft Parts Procurement
- Defense Logistics Agency Contracts
- Avionics and Systems Maintenance
- Military Aircraft Sustainment
- Sole-Source Defense Contracts
Risk Flags
- Sole-source award
- Lack of competition
- Potential for inflated pricing
- No small business participation noted
Tags
defense, department-of-defense, simmonds-precision-products-inc, sole-source, firm-fixed-price, aircraft-parts, ivhms-kits, defense-contract-management-agency, naics-336413, long-term-contract, non-competed
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $31.7 million to SIMMONDS PRECISION PRODUCTS INC. PROCUREMENT OF IVHMS KITS, GSE KITS, AND DEPLOYMENT SPARES UNDER IDIQ CONTRACT.
Who is the contractor on this award?
The obligated recipient is SIMMONDS PRECISION PRODUCTS INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $31.7 million.
What is the period of performance?
Start: 2008-08-27. End: 2012-05-30.
What is the specific function and importance of IVHMS kits in military aircraft?
IVHMS stands for Integrated Vehicle Health Management System. These systems are crucial for modern military aircraft as they continuously monitor the performance and condition of various aircraft components in real-time. They collect data on engine performance, structural integrity, flight control systems, and other critical subsystems. By analyzing this data, IVHMS can predict potential failures, diagnose issues, optimize maintenance schedules, and provide pilots with vital information about the aircraft's status. This proactive approach enhances safety, improves mission readiness, reduces downtime, and can extend the operational lifespan of expensive aircraft. The kits procured under this contract likely represent the core components or replacement parts necessary for these systems to function effectively.
Why was this contract awarded on a sole-source basis instead of being competed?
The provided data indicates the contract was 'NOT COMPETED' and classified as 'sole-source'. Specific justifications for sole-source awards typically fall under categories such as unique capabilities, urgent and compelling needs, or when only one responsible source can fulfill the requirement. Without further documentation or agency statements, the exact reason remains unknown. However, common rationales include proprietary technology held by Simmonds Precision Products Inc., a critical and time-sensitive need where competition would cause unacceptable delays, or if the required parts were highly specialized and only available from this specific manufacturer. The lack of competition means taxpayers did not benefit from potential cost savings through competitive bidding.
How does the firm-fixed-price (FFP) contract type impact risk and cost for this procurement?
A Firm-Fixed-Price (FFP) contract is designed to provide the government with cost certainty. Under an FFP agreement, the contractor, Simmonds Precision Products Inc., is obligated to complete the work for a predetermined price, regardless of the actual costs incurred. This shifts the primary risk of cost overruns from the government to the contractor. For the government, this means the total expenditure is known upfront, aiding in budget planning. However, because this contract was sole-source, the government may not have achieved the lowest possible price, as there was no competitive pressure to drive down costs. The contractor bears the risk of increased material or labor costs, but also has the incentive to control expenses to maximize profit.
What is the typical market landscape for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (NAICS 336413)?
The NAICS code 336413, 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' encompasses establishments primarily engaged in manufacturing aircraft parts and auxiliary equipment, not elsewhere classified. This includes components like landing gear, aircraft lighting systems, aircraft seating, and potentially specialized systems like IVHMS. The market is often characterized by high technical requirements, stringent quality control, and significant regulatory oversight, particularly for defense applications. Many firms in this sector are either large, established aerospace manufacturers or specialized suppliers with niche expertise. Competition can be intense for competitively awarded contracts, but sole-source awards are also common for proprietary components or when specific technical qualifications are paramount, as may be the case with Simmonds Precision Products Inc.
What does the contract duration of 1372 days imply about the nature of the requirement?
A contract duration of 1372 days, which is approximately 3.75 years, suggests that the requirement for IVHMS kits, GSE kits, and deployment spares is not a short-term or one-off need. Instead, it points to a sustained, ongoing demand for these components. This could be due to the long service life of the aircraft platforms utilizing these systems, the planned obsolescence of existing parts requiring replacement, or the integration of these systems into new platforms over an extended period. Such a long duration typically necessitates robust supply chain management and potentially requires the contractor to maintain production capabilities over several years, reinforcing the importance of the supplier's reliability.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES
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
Parent Company: RTX Corp (UEI: 001344142)
Address: 100 PANTON RD, VERGENNES, VT, 05491
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: $31,706,018
Exercised Options: $31,706,018
Current Obligation: $31,706,018
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W58RGZ08D0224
IDV Type: IDC
Timeline
Start Date: 2008-08-27
Current End Date: 2012-05-30
Potential End Date: 2012-05-30 00:00:00
Last Modified: 2015-01-30
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