DoD Awards $177M for Operational Training Devices to McDonnell Douglas, Later Boeing

Contract Overview

Contract Amount: $176,809,564 ($176.8M)

Contractor: THE Boeing Company (0674)

Awarding Agency: Department of Defense

Start Date: 1999-02-12

End Date: 2007-09-30

Contract Duration: 3,152 days

Daily Burn Rate: $56.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 199905!5700!0027!GU86 !ASC/YWK !F3365798D2030 !A!*!0002 !19990212!20020131!006265946!006265946!009256819!N!0PXV4!MCDONNELL DOUGLAS CORPORATION !LAMBERT ST LOUIS AIRPORT !SAINT LOUIS !MO!63103!52500!027!40!NORMAN !CLEVELAND !OKLAHOMA !0001!+000015174948!N!N!000000000000!6930!OPERATIONAL TRAINING DEVICES !A1C!OTHER AIRCRAFT EQUIPMENT !3000!NOT DISCERNABLE OR CLASSIFIED !3728!5!B!M!*!B!B!*!A !N!J!2!011!B!* !Z!Y!F!* !* !N!C!*!Z!Z!A!A!A!*!* !*!N!A!B!N!*!*!*!*!*!

Place of Performance

Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $176.8 million to THE BOEING COMPANY (0674) for work described as: 199905!5700!0027!GU86 !ASC/YWK !F3365798D2030 !A!*!0002 !19990212!20020131!006265946!006265946!009256819!N!0PXV4!MCDONNELL DOUGLAS CORPORATION !LAMBERT ST LOUIS AIRPORT !SAINT LOUIS !MO!63103!52500!027!40!NORMAN !CLEVEL… Key points: 1. The contract, awarded in 1999, was for operational training devices, a critical component for military readiness. 2. McDonnell Douglas, later acquired by Boeing, secured this significant award, highlighting its role in defense manufacturing. 3. The contract's duration spanned nearly a decade, indicating a long-term need for these training systems. 4. The specific Public Service Code (PSC) and North American Industry Classification System (NAICS) codes point to specialized aircraft equipment manufacturing.

Value Assessment

Rating: fair

The total award amount of $176,809,563.65 for operational training devices appears substantial. Benchmarking against similar contracts for complex training systems is necessary to fully assess its value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process that should have driven price discovery. However, the long duration and specific nature of the equipment might limit the number of viable bidders.

Taxpayer Impact: While competition was intended to ensure fair pricing, the long-term nature of the contract and potential for specialized requirements could impact the ultimate cost-effectiveness for taxpayers.

Public Impact

Ensures military personnel are adequately trained on complex aircraft systems, directly impacting national security readiness. Supports jobs in the aerospace and defense manufacturing sector, particularly in Missouri where the contractor was located. The long contract period suggests a sustained investment in maintaining and upgrading training capabilities for the armed forces.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the long contract duration and evolving technology.
Risk of contractor performance issues impacting training schedules and readiness.
Limited visibility into the specific performance metrics and quality control during the contract's execution.

Positive Signals

Awarded under full and open competition, indicating an effort to secure competitive pricing.
Contract supports critical defense training needs, aligning with national security objectives.
The contractor, McDonnell Douglas (later Boeing), is a major defense industry player with a track record in complex systems.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on training devices. Spending in this area is crucial for maintaining military readiness and technological superiority, with benchmarks often tied to the complexity and technological sophistication of the training systems required.

Small Business Impact

The data indicates the primary contractor was McDonnell Douglas Corporation, a large business. There is no explicit information provided regarding subcontracting opportunities for small businesses on this specific award.

Oversight & Accountability

Oversight would typically be managed by the Department of Defense's contract management agencies. The long duration of the contract necessitates ongoing monitoring to ensure performance, quality, and adherence to terms, though specific oversight details are not provided.

Related Government Programs

Other Aircraft Parts and Auxiliary Equipment Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Long contract duration increases risk of cost escalation and technological obsolescence.
Potential for performance issues impacting military training schedules.
Lack of detailed information on specific oversight and quality assurance measures.
Contractor consolidation (McDonnell Douglas acquired by Boeing) could impact future competition or oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $176.8 million to THE BOEING COMPANY (0674). 199905!5700!0027!GU86 !ASC/YWK !F3365798D2030 !A!*!0002 !19990212!20020131!006265946!006265946!009256819!N!0PXV4!MCDONNELL DOUGLAS CORPORATION !LAMBERT ST LOUIS AIRPORT !SAINT LOUIS !MO!63103!52500!027!40!NORMAN !CLEVELAND !OKLAHOMA !0001!+000015174948!N!N!000000000000!6930!OPERATIONAL TRAINING DEVICES !A1C!OTHER AIRCRAFT EQUIPMENT !3000!NOT DISCERNABLE OR CLASSIFIED !3728!5!B!M!*!B!B!*!A !N!J!2!0

Who is the contractor on this award?

The obligated recipient is THE BOEING COMPANY (0674).

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $176.8 million.

What is the period of performance?

Start: 1999-02-12. End: 2007-09-30.

What was the specific type and complexity of the 'Operational Training Devices' procured under this contract, and how did their technical specifications influence the bidding process?

The data identifies the item as 'OPERATIONAL TRAINING DEVICES' under PSC 6930 and NAICS 336413 (Other Aircraft Parts and Auxiliary Equipment Manufacturing). These likely refer to sophisticated simulators or training apparatus for aircraft operation and maintenance. The complexity and specialized nature of such devices would significantly narrow the field of potential bidders to those with proven expertise and facilities in advanced aerospace simulation technology.

Given the contract's long duration (1999-2007), what mechanisms were in place to manage potential price increases or technological obsolescence of the training devices?

Contracts of this length typically include provisions for managing price changes, such as economic price adjustment clauses, and mechanisms for addressing technological advancements. However, the provided data does not detail these specific clauses. It's probable that modifications or separate contracts would have been used to incorporate new technologies or adjust for significant market shifts over the nearly decade-long period.

How did the 'full and open competition' process ensure value for money, considering the specialized nature of the training devices and the long performance period?

Full and open competition aims to maximize the number of potential bidders, thereby fostering price competition. For specialized items like advanced training devices, the 'open' aspect ensures all qualified firms can compete. The 'value for money' is then assessed based on the proposals received, considering not just price but also technical capability, past performance, and delivery schedules. The long duration suggests that the initial competition likely focused on a base requirement with options for sustainment or upgrades.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: THE Boeing Company (UEI: 009256819)

Address: LAMBERT ST LOUIS AIRPORT, SAINT LOUIS, MO, 63103

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: F3365798D2030

IDV Type: IDC

Timeline