DoD's $270M AVIM/AVUM Maintenance Contract Awarded to Vertex Aerospace Faces Scrutiny
Contract Overview
Contract Amount: $270,287,547 ($270.3M)
Contractor: Vertex Aerospace LLC
Awarding Agency: Department of Defense
Start Date: 2007-09-21
End Date: 2008-09-30
Contract Duration: 375 days
Daily Burn Rate: $720.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: TIME AND MATERIALS
Sector: Defense
Official Description: AVIM/AVUM MAINTENANCE FOR VARIOUS U.S. ARMY AIRCRAFT
Place of Performance
Location: MADISON, MADISON County, MISSISSIPPI, 39110
Plain-Language Summary
Department of Defense obligated $270.3 million to VERTEX AEROSPACE LLC for work described as: AVIM/AVUM MAINTENANCE FOR VARIOUS U.S. ARMY AIRCRAFT Key points: 1. The contract, valued at $270.3 million, covers maintenance for U.S. Army aircraft. 2. Vertex Aerospace LLC secured the award, with the Defense Contract Management Agency overseeing. 3. The contract was awarded under full and open competition, suggesting a competitive bidding process. 4. Concerns may arise regarding the 'Time and Materials' pricing structure and its potential impact on overall cost. 5. The sector is Defense, specifically aircraft parts manufacturing.
Value Assessment
Rating: fair
The 'Time and Materials' pricing structure can lead to cost overruns if not carefully managed. Benchmarking against similar aircraft maintenance contracts is crucial to assess if the $270.3 million is competitive.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, which typically fosters competitive pricing. However, the 'Time and Materials' pricing model might limit price discovery and could lead to higher costs than fixed-price contracts.
Taxpayer Impact: Taxpayer funds are utilized for aircraft maintenance. The 'Time and Materials' pricing could result in higher-than-expected expenditures if not rigorously monitored.
Public Impact
Ensures operational readiness of U.S. Army aircraft through essential maintenance. Supports jobs within the aerospace and defense manufacturing sector. Potential for cost inefficiencies due to the 'Time and Materials' pricing model. The contract duration of 375 days (approximately 1 year) suggests a focus on immediate or short-term maintenance needs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Time and Materials pricing
- Lack of specific performance metrics in provided data
- Potential for cost overruns
Positive Signals
- Awarded under full and open competition
- Supports critical military aviation assets
Sector Analysis
This contract falls within the Defense sector, specifically the manufacturing of aircraft parts and auxiliary equipment. Spending in this area is critical for national security, but often involves complex and costly maintenance requirements.
Small Business Impact
The data indicates the prime contractor is Vertex Aerospace LLC. It is unclear from the provided information whether small businesses were subcontracted for this specific award, which warrants further investigation.
Oversight & Accountability
The Defense Contract Management Agency (DCMA) is responsible for oversight. Robust oversight is necessary to manage the 'Time and Materials' contract effectively and ensure cost control and performance.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for cost overruns due to Time and Materials pricing.
- Limited visibility into specific maintenance tasks and their criticality.
- Lack of clear performance metrics in the provided data.
- Uncertainty regarding small business subcontracting participation.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, ms, do, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $270.3 million to VERTEX AEROSPACE LLC. AVIM/AVUM MAINTENANCE FOR VARIOUS U.S. ARMY AIRCRAFT
Who is the contractor on this award?
The obligated recipient is VERTEX AEROSPACE LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $270.3 million.
What is the period of performance?
Start: 2007-09-21. End: 2008-09-30.
What specific maintenance tasks are included under AVIM/AVUM, and how do they align with Army readiness requirements?
AVIM (Aviation Intermediate Maintenance) and AVUM (Aviation Unit Maintenance) encompass a range of repair, overhaul, and servicing activities essential for keeping Army aircraft operational. These tasks are critical for maintaining the readiness of aviation units, ensuring aircraft are safe and effective for their intended missions. The scope likely includes scheduled inspections, component replacements, and unscheduled repairs to address emergent issues.
How does the 'Time and Materials' pricing structure mitigate or exacerbate risks associated with aircraft maintenance costs?
The 'Time and Materials' (T&M) pricing structure can be a double-edged sword. It offers flexibility for unforeseen repair needs and fluctuating labor costs, potentially benefiting the contractor. However, it shifts significant cost risk to the government, as the final price is not fixed. Without stringent oversight, detailed tracking of labor hours and material costs, and clear task definitions, T&M contracts are prone to cost overruns and potential inefficiencies.
What are the key performance indicators (KPIs) used to measure the effectiveness of Vertex Aerospace's maintenance services under this contract?
Effective measurement of this contract's success would rely on KPIs such as aircraft availability rates, mean time between failures (MTBF), turnaround time for repairs, adherence to maintenance schedules, and compliance with technical orders. The government would need to track these metrics rigorously to ensure Vertex Aerospace is meeting performance expectations and delivering value for the $270.3 million investment.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 4
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)
Address: 8001 MID AMERICA BLVD STE 500, OKLAHOMA CITY, OK, 90
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $270,287,547
Exercised Options: $270,287,547
Current Obligation: $270,287,547
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: F3460197D0425
IDV Type: IDC
Timeline
Start Date: 2007-09-21
Current End Date: 2008-09-30
Potential End Date: 2008-09-30 00:00:00
Last Modified: 2012-01-31
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