DoD awards $24.4M to General Electric for T700 Engine Support, a sole-source contract
Contract Overview
Contract Amount: $243,783,968 ($243.8M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2012-01-01
End Date: 2012-12-31
Contract Duration: 365 days
Daily Burn Rate: $667.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: TELSS AND MATAERIAL SPT FOR T700 ENG AT CCAD
Place of Performance
Location: CINCINNATI, HAMILTON County, OHIO, 45215, UNITED STATES OF AMERICA
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $243.8 million to GENERAL ELECTRIC COMPANY for work described as: TELSS AND MATAERIAL SPT FOR T700 ENG AT CCAD Key points: 1. Contract awarded to General Electric Company for engineering services. 2. Significant spending on engine support for the T700 engine. 3. Sole-source award raises questions about competition and potential cost savings. 4. The IT sector is not directly involved in this engineering services contract.
Value Assessment
Rating: questionable
The contract value of $24.4 million for engineering services is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to market rates for similar engine support services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to General Electric Company. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying a premium for these engineering services.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The Department of the Army relies on a single vendor for critical engine support. Potential for reduced innovation and service quality without market pressure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
Positive Signals
- Essential support for T700 engines
Sector Analysis
This contract falls under Engineering Services, a sector crucial for maintaining complex military equipment like aircraft engines. Benchmarks for such specialized services can vary widely, but competitive procurement typically drives better value.
Small Business Impact
There is no indication that small businesses were involved in this sole-source contract, limiting opportunities for smaller enterprises in this procurement.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure the Department of Defense is obtaining fair value and that competition was appropriately waived.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award lacks competition.
- Potential for inflated pricing.
- Limited transparency in cost determination.
- No small business participation identified.
Tags
engineering-services, department-of-defense, oh, do, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $243.8 million to GENERAL ELECTRIC COMPANY. TELSS AND MATAERIAL SPT FOR T700 ENG AT CCAD
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $243.8 million.
What is the period of performance?
Start: 2012-01-01. End: 2012-12-31.
What is the justification for the sole-source award, and has a market research report been conducted to confirm the necessity of General Electric Company as the only provider?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent needs where only one vendor can fulfill the requirement. A thorough market research report is essential to validate these claims and ensure no other qualified sources exist. Without this information, it's difficult to ascertain the validity of the sole-source decision and its impact on cost-effectiveness.
How does the cost of this contract compare to historical spending on similar T700 engine support services, and what mechanisms are in place to control costs under a sole-source arrangement?
Comparing costs requires access to historical data and potentially industry benchmarks for T700 engine support. In sole-source contracts, cost controls often rely on detailed contract clauses, profit limitations, and government cost audits. The absence of competition means the government must be particularly diligent in negotiating and monitoring contract terms to prevent cost overruns and ensure fair pricing.
What is the long-term strategy for T700 engine support, and will future procurements consider competitive options to ensure sustained value and technological advancement?
The long-term strategy should ideally involve exploring competitive avenues for future T700 engine support to leverage market dynamics for better pricing and innovation. This might include breaking down the requirement into smaller components, encouraging new entrants, or developing alternative support solutions. A proactive approach to competition planning can prevent prolonged reliance on sole-source contracts and ensure the best value for the Department of Defense.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
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: 1 NEUMANN WAY, CINCINNATI, OH, 45215
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $243,783,968
Exercised Options: $243,783,968
Current Obligation: $243,783,968
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W58RGZ12D0015
IDV Type: IDC
Timeline
Start Date: 2012-01-01
Current End Date: 2012-12-31
Potential End Date: 2012-12-31 00:00:00
Last Modified: 2015-08-13
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