Navy Aviation contract with Boeing exceeds $60M, awarded via full and open competition

Contract Overview

Contract Amount: $60,758,296 ($60.8M)

Contractor: THE Boeing Company (0674)

Awarding Agency: Department of Defense

Start Date: 2013-09-25

End Date: 2022-06-30

Contract Duration: 3,200 days

Daily Burn Rate: $19.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: NAVY AVIATION

Place of Performance

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

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $60.8 million to THE BOEING COMPANY (0674) for work described as: NAVY AVIATION Key points: 1. Contract value represents a significant investment in naval aviation systems. 2. Awarded to a single, established prime contractor, suggesting a focus on specialized capabilities. 3. The duration of the contract indicates a long-term need for these aviation systems. 4. Fixed-price contract type aims to control costs and provide predictability. 5. The contract is situated within the broader defense industrial base for aerospace manufacturing.

Value Assessment

Rating: good

The total award of over $60 million for aviation systems is substantial. Benchmarking this against similar contracts for complex aerospace components is challenging without more specific system details. However, the firm fixed-price structure suggests an effort to manage costs effectively. The contract's duration implies a sustained need, and the value appears aligned with the complexity and scale of manufacturing advanced aviation equipment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This specific designation suggests that while the initial solicitation was open, certain sources were later excluded, potentially due to specific technical requirements or security clearances. The exact number of bidders after exclusions is not detailed, but the 'limited' competition level might imply fewer than a truly open bid process, potentially impacting price negotiation.

Taxpayer Impact: While the competition was not entirely unrestricted, the 'full and open' aspect suggests an attempt to solicit broad interest. The exclusion of sources warrants scrutiny to ensure it was based on legitimate technical or security needs rather than market manipulation, which could affect taxpayer value.

Public Impact

Naval aviation forces benefit from the supply of critical search, detection, navigation, and guidance systems. The contract supports the operational readiness and technological advancement of the U.S. Navy's air assets. Geographic impact is concentrated in Missouri, where the prime contractor is located, supporting local employment and the regional economy. Workforce implications include skilled manufacturing jobs in aerospace engineering, production, and quality assurance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to source exclusions impacting price discovery.
Reliance on a single prime contractor for critical systems could pose supply chain risks.
Long contract duration might lead to cost overruns if not managed diligently.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established contractor like Boeing suggests a high likelihood of meeting technical specifications.
Long-term nature of the contract ensures sustained support for vital naval aviation capabilities.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on the production of advanced navigation and guidance systems for aircraft. The market for such specialized components is characterized by high barriers to entry, significant R&D investment, and stringent quality requirements. Comparable spending benchmarks would likely be found within other large-scale defense procurements for complex electronic and avionic systems, often running into tens or hundreds of millions of dollars.

Small Business Impact

The data indicates that small business participation was not a primary set-aside criterion for this contract (ss: false, sb: false). While the prime contractor, Boeing, is a large entity, there may be subcontracting opportunities for small businesses within its supply chain. The extent of small business involvement would depend on Boeing's subcontracting plan and the specific needs for components and services.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy's contracting and program management offices. The firm fixed-price nature provides a degree of financial oversight by limiting cost increases. Transparency is facilitated through contract award databases, though detailed performance metrics and specific oversight activities are typically internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Navy Aviation Systems Procurement
Aerospace Manufacturing Contracts
Defense Electronics and Navigation Systems
Boeing Defense Contracts
Search, Detection, Navigation, Guidance Systems

Risk Flags

Limited competition due to source exclusion.
Potential for supply chain disruption if sole-source prime contractor faces issues.
Long contract duration requires diligent oversight to prevent cost creep.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $60.8 million to THE BOEING COMPANY (0674). NAVY AVIATION

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 (Department of the Navy).

What is the total obligated amount?

The obligated amount is $60.8 million.

What is the period of performance?

Start: 2013-09-25. End: 2022-06-30.

What is the historical spending trend for similar Navy aviation navigation and guidance systems over the past five years?

Analyzing historical spending trends for similar Navy aviation navigation and guidance systems requires access to detailed procurement data beyond this single contract. However, general trends in defense spending indicate a consistent demand for advanced avionics and sensor technology to maintain air superiority and operational effectiveness. Factors such as technological obsolescence, new platform development, and geopolitical requirements influence year-over-year spending. Without specific data on comparable systems, it's difficult to pinpoint precise trends, but the overall defense budget allocation towards aviation modernization suggests sustained or increasing investment in these critical areas.

How does the awarded price compare to industry benchmarks for similar navigation and guidance systems?

Benchmarking the awarded price of $60.7 million for these navigation and guidance systems against industry standards is complex without granular cost breakdowns and specific system performance metrics. The aerospace and defense sector often involves highly customized, technologically advanced components where direct price comparisons are difficult. Factors such as the system's complexity, required reliability, integration challenges, and the specific technological capabilities offered by Boeing influence the price. Generally, firm fixed-price contracts aim for competitive pricing, but the 'limited' competition aspect after source exclusion might affect the degree of price pressure. A thorough benchmark would require comparing unit costs, performance specifications, and lifecycle support against similar, independently procured systems.

What are the key performance indicators (KPIs) used to measure the success of this contract?

Key performance indicators (KPIs) for a contract of this nature typically focus on ensuring the delivered systems meet stringent technical specifications, reliability standards, and operational readiness requirements for naval aviation. These could include metrics such as on-time delivery of components and systems, adherence to quality control standards (e.g., defect rates), system performance validation (e.g., accuracy, range, uptime), and successful integration with existing aircraft platforms. Furthermore, contract success might be measured by the contractor's responsiveness to technical issues, cost control within the fixed-price framework, and overall supportability of the systems throughout their lifecycle. Specific KPIs are usually detailed within the contract's Statement of Work (SOW) and performance clauses.

What is the track record of The Boeing Company in delivering similar complex aviation systems to the Department of Defense?

The Boeing Company has a long and extensive track record of delivering complex aviation systems and components to the Department of Defense, including the Navy. They are a major prime contractor for numerous aircraft platforms (e.g., F/A-18, P-8 Poseidon) and have significant experience in developing and manufacturing sophisticated avionics, sensors, and mission systems. While Boeing's history includes notable successes, like any large defense contractor, they have also faced challenges related to program delays, cost overruns on certain projects, and technical issues. However, their established position and continued awards suggest a generally strong performance record in meeting the demanding requirements of military aviation procurements.

What are the potential risks associated with the 'full and open competition after exclusion of sources' award type?

The 'full and open competition after exclusion of sources' award type presents specific risks. While it begins with an open solicitation, the subsequent exclusion of sources can limit the pool of potential bidders. This reduction in competition, if not justified by clear technical or security necessity, could lead to less competitive pricing than a truly open process. It also raises questions about the fairness and transparency of the exclusion criteria. Potential risks include higher costs for taxpayers, reduced innovation from a smaller bidder pool, and the possibility of perceived or actual favoritism if exclusions are not rigorously documented and defended. Ensuring the exclusions were based on objective, mission-critical requirements is paramount.

How does this contract contribute to the overall modernization goals of the U.S. Navy's aviation fleet?

This contract directly contributes to the modernization goals of the U.S. Navy's aviation fleet by ensuring the continued availability and potential upgrade of critical search, detection, navigation, and guidance systems. These systems are fundamental to the operational effectiveness of naval aircraft, enabling them to perform missions in complex environments, enhance situational awareness, and improve targeting capabilities. By procuring advanced or sustained versions of these systems, the Navy maintains the technological edge of its air assets, supports the integration of new platforms, and ensures that existing fleets remain capable against evolving threats. The long-term nature of the contract suggests a commitment to maintaining and enhancing these vital capabilities.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: THE Boeing Company

Address: 6200 J S MCDONNELL BLVD, SAINT LOUIS, MO, 63134

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $60,758,296

Exercised Options: $60,758,296

Current Obligation: $60,758,296

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0038307D001J

IDV Type: IDC

Timeline