V-22 Repair Contract Awarded to Hamilton Sundstrand for $21.6M, Not Competed

Contract Overview

Contract Amount: $21,587,075 ($21.6M)

Contractor: Hamilton Sundstrand Corporation

Awarding Agency: Department of Defense

Start Date: 2014-04-02

End Date: 2016-09-30

Contract Duration: 912 days

Daily Burn Rate: $23.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: V-22 REPAIR CFG

Place of Performance

Location: ROCKFORD, WINNEBAGO County, ILLINOIS, 61125

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $21.6 million to HAMILTON SUNDSTRAND CORPORATION for work described as: V-22 REPAIR CFG Key points: 1. Contract awarded to a single supplier, raising questions about price competitiveness. 2. Limited competition may indicate specialized repair needs or a lack of market alternatives. 3. The contract duration of over two years suggests a significant ongoing requirement for V-22 repairs. 4. Fixed-price contract type aims to control costs, but initial pricing needs scrutiny. 5. The award falls under 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' a broad category. 6. Geographic location in Illinois for repair services.

Value Assessment

Rating: questionable

Benchmarking the value for this specific V-22 repair contract is challenging without comparable sole-source awards. The fixed-price nature is a positive cost control measure. However, the lack of competition means there's no direct market comparison to assess if the $21.6 million represents a fair price. Further analysis would require understanding the specific components and labor involved in the repair to compare against industry standards for similar aircraft maintenance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Hamilton Sundstrand Corporation, was solicited. This approach is typically used when only one responsible source is available or when there's a compelling justification for excluding other potential bidders. The lack of competition limits the government's ability to leverage market forces to achieve the lowest possible price.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive bidding. Without competing the requirement, there is less assurance that the price reflects the best value achievable in a competitive market.

Public Impact

The primary beneficiaries are the U.S. Navy and Marine Corps, ensuring the operational readiness of the V-22 Osprey fleet. Services delivered include the repair and maintenance of critical V-22 aircraft components. The contract has a geographic impact concentrated in Illinois, where the repairs will be performed. Workforce implications include employment opportunities for skilled technicians and support staff at Hamilton Sundstrand's facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential cost savings.
Lack of competition raises concerns about potential overpricing without market validation.
Contract duration of over two years requires careful monitoring of performance and costs.

Positive Signals

Fixed-price contract type provides cost certainty for the government.
Award to an established contractor like Hamilton Sundstrand may indicate specialized expertise required for V-22 repairs.
The contract supports the operational readiness of a critical military aircraft.

Sector Analysis

The aerospace and defense sector is characterized by high barriers to entry, complex supply chains, and significant R&D investment. Repair and maintenance services for specialized military aircraft like the V-22 often fall into niche markets where a limited number of contractors possess the necessary certifications, technical expertise, and proprietary knowledge. Spending in this sub-sector is driven by the need to maintain fleet readiness and extend the operational life of aging aircraft. Comparable spending benchmarks would typically involve analyzing other sole-source or limited-competition repair contracts for similar complex aircraft platforms.

Small Business Impact

This contract does not appear to involve a small business set-aside, as indicated by 'sb': false. There is no explicit information provided regarding subcontracting plans or performance related to small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear, though large sole-source contracts can sometimes limit opportunities for smaller specialized repair firms.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures would include performance monitoring against contract requirements and adherence to the fixed-price terms. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

V-22 Osprey Sustainment Programs
Department of Defense Aircraft Maintenance Contracts
Aerospace Component Repair Services
Naval Aviation Readiness Programs

Risk Flags

Sole-source award
Potential for cost overruns without competition
Reliance on a single supplier for critical repairs

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.6 million to HAMILTON SUNDSTRAND CORPORATION. V-22 REPAIR CFG

Who is the contractor on this award?

The obligated recipient is HAMILTON SUNDSTRAND CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $21.6 million.

What is the period of performance?

Start: 2014-04-02. End: 2016-09-30.

What is Hamilton Sundstrand Corporation's track record with V-22 Osprey repair contracts?

Hamilton Sundstrand Corporation, now part of Collins Aerospace (a Raytheon Technologies company), has a history of providing components and services for the V-22 Osprey program. Their involvement typically spans various systems and repair needs. While this specific contract is a sole-source award for repairs, their broader participation in the V-22 supply chain suggests they possess the necessary technical capabilities and historical knowledge. Further investigation into past performance reviews and previous contract awards for similar V-22 repair services would provide a more comprehensive understanding of their track record and reliability in this specific domain.

How does the $21.6 million contract value compare to similar V-22 repair services?

Direct comparison of the $21.6 million contract value is difficult due to its sole-source nature and the specific scope of 'repair' which can vary significantly. Without competitive bids, it's impossible to establish a market-driven price benchmark. To assess value, one would need to break down the contract into specific repair tasks, labor hours, and parts required, and then compare these elements against industry standards for similar complex aircraft maintenance, or against historical data for V-22 repairs if available from other sources. The lack of competition inherently limits the ability to definitively state if this represents optimal value.

What are the primary risks associated with this sole-source V-22 repair contract?

The primary risk is financial: the government may be overpaying due to the absence of competitive pressure. There's also a risk of vendor lock-in, where the government becomes overly reliant on Hamilton Sundstrand for these specific repairs, potentially limiting future flexibility. Performance risk exists, although less likely with an established contractor; however, any delays or quality issues could impact V-22 operational readiness. Finally, a lack of transparency inherent in sole-source awards can obscure potential inefficiencies or cost escalations.

How effective is the fixed-price contract type in managing costs for V-22 repairs?

The Firm Fixed Price (FFP) contract type is generally effective in managing costs by shifting the risk of cost overruns to the contractor. For the government, it provides a clear ceiling on expenditures. However, its effectiveness hinges on the accuracy of the initial cost estimate and the contractor's ability to perform the work within that price. If the scope of work was underestimated or unforeseen issues arise, the contractor might cut corners on quality, or seek change orders, potentially negating some cost benefits. For specialized repairs like those on the V-22, ensuring the FFP adequately covers all necessary work without compromising quality is crucial.

What are the historical spending patterns for V-22 repair and maintenance by the Department of the Navy?

Historical spending on V-22 repair and maintenance by the Department of the Navy is substantial, reflecting the operational tempo and complexity of the aircraft. While specific figures for repair contracts fluctuate annually based on fleet readiness needs, component lifecycles, and modernization efforts, the overall sustainment costs for the V-22 program represent a significant portion of the Naval aviation budget. Analyzing past contract awards for V-22 maintenance, component overhauls, and depot-level repairs, including both competitive and sole-source actions, would reveal trends in spending volume, average contract values, and the prevalence of different contract types over time.

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: 4747 HARRISON AVE, ROCKFORD, IL, 61108

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: $21,587,075

Exercised Options: $21,587,075

Current Obligation: $21,587,075

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0038312D011N

IDV Type: IDC

Timeline