Coast Guard awards $3.67M for MH-65 aircraft spare parts, citing non-availability exceptions

Contract Overview

Contract Amount: $3,672,827 ($3.7M)

Contractor: Airbus Helicopters, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2025-03-12

End Date: 2026-10-28

Contract Duration: 595 days

Daily Burn Rate: $6.2K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: PROCUREMENT OF VARIOUS SPARE PARTS USED ON THE MH-65 AIRCRAFT. CLASS DETERMINATION FOR NONAVAILABILITY ARTICLES IAW FAR 25.103(B)(1) APPLIES TO THIS ACTION, BAA EXCEPTION MTF IS IN THE FILE. SECTION 2(D)

Place of Performance

Location: GRAND PRAIRIE, TARRANT County, TEXAS, 75052

State: Texas Government Spending

Plain-Language Summary

Department of Homeland Security obligated $3.7 million to AIRBUS HELICOPTERS, INC. for work described as: PROCUREMENT OF VARIOUS SPARE PARTS USED ON THE MH-65 AIRCRAFT. CLASS DETERMINATION FOR NONAVAILABILITY ARTICLES IAW FAR 25.103(B)(1) APPLIES TO THIS ACTION, BAA EXCEPTION MTF IS IN THE FILE. SECTION 2(D) Key points: 1. Contract focuses on specialized spare parts for MH-65 aircraft, indicating a need for specific, potentially hard-to-source components. 2. The award was made using a non-availability exception, suggesting limited or no domestic sources for these parts. 3. The contract value of approximately $3.67 million covers a period extending into late 2026. 4. The fixed-price contract type aims to provide cost certainty for the government. 5. This procurement is essential for maintaining the operational readiness of the MH-65 helicopter fleet. 6. The primary contractor, Airbus Helicopters, Inc., is a key supplier for this aircraft type.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to the specific nature of the spare parts and the non-availability exception, which limits direct comparisons. The firm fixed-price structure provides some cost control. However, without competitive bidding, it's difficult to ascertain if the pricing reflects optimal market value. The total award amount of $3.67 million over nearly two years suggests a moderate level of annual spending for these specialized parts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, citing FAR 25.103(b)(1) for non-availability articles and a "BAA exception." This implies that the required spare parts are not readily available from multiple sources, leading to a sole-source award to Airbus Helicopters, Inc. The lack of competition means there was no opportunity for price discovery through a bidding process.

Taxpayer Impact: Taxpayers may face higher prices due to the absence of competitive pressure. The government relies on the contractor's pricing without the benefit of market validation.

Public Impact

The U.S. Coast Guard benefits directly through the acquisition of critical spare parts, ensuring the continued operational capability of its MH-65 helicopter fleet. These parts are essential for maintaining the safety and effectiveness of Coast Guard search and rescue, maritime law enforcement, and other vital missions. The geographic impact is primarily national, supporting Coast Guard operations across various regions. The contract supports the specialized manufacturing and supply chain related to aviation components.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially leading to higher costs for taxpayers.
Reliance on a single supplier for critical parts can create supply chain vulnerabilities.
The non-availability exception requires careful justification to ensure it is genuinely necessary.

Positive Signals

Firm fixed-price contract provides cost certainty.
Award to a known manufacturer of the aircraft ensures part compatibility and quality.
Procurement is essential for maintaining operational readiness of a key Coast Guard asset.

Sector Analysis

The aerospace and defense sector, particularly the segment focused on aircraft parts and maintenance, is characterized by specialized manufacturing and often long lead times. Procurements for legacy aircraft like the MH-65 often involve sole-source or limited competition due to the proprietary nature of parts and the limited number of qualified manufacturers. Spending in this area is driven by fleet sustainment requirements and operational tempo. Comparable spending benchmarks are difficult without knowing the specific part numbers and quantities, but overall defense aviation parts procurement runs into billions annually.

Small Business Impact

This contract does not appear to involve a small business set-aside, as indicated by 'sb: false'. There is no explicit mention of subcontracting requirements for small businesses. The award is made directly to Airbus Helicopters, Inc., a large aerospace manufacturer, suggesting limited direct opportunities for small businesses within this specific contract action.

Oversight & Accountability

Oversight for this contract would fall under the U.S. Coast Guard's contracting and program management offices. Accountability is maintained through contract clauses, performance monitoring, and the firm fixed-price structure. Transparency is facilitated by public contract databases, although the justification for the sole-source award might be detailed in internal documentation. The Department of Homeland Security's Inspector General may have jurisdiction for audits and investigations.

Related Government Programs

MH-65 Helicopter Sustainment
Aviation Spare Parts Procurement
Department of Homeland Security Aviation Contracts
Coast Guard Fleet Readiness

Risk Flags

Sole-source award
Non-availability exception justification
Potential for price escalation
Supply chain dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $3.7 million to AIRBUS HELICOPTERS, INC.. PROCUREMENT OF VARIOUS SPARE PARTS USED ON THE MH-65 AIRCRAFT. CLASS DETERMINATION FOR NONAVAILABILITY ARTICLES IAW FAR 25.103(B)(1) APPLIES TO THIS ACTION, BAA EXCEPTION MTF IS IN THE FILE. SECTION 2(D)

Who is the contractor on this award?

The obligated recipient is AIRBUS HELICOPTERS, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $3.7 million.

What is the period of performance?

Start: 2025-03-12. End: 2026-10-28.

What is the specific justification for the non-availability exception cited for this procurement?

The justification for the non-availability exception (FAR 25.103(b)(1)) is typically based on the determination that the required spare parts are not manufactured in the United States in sufficient commercial quantities to meet the needs of the government. This often applies to specialized components for foreign-made or older aircraft where domestic production capabilities are limited or non-existent. The specific details of this determination, including the 'BAA exception MTF' mentioned, would be documented within the contract file, likely outlining the market research conducted to confirm the lack of domestic sources and the rationale for accepting foreign-made articles.

How does the pricing of these spare parts compare to similar components for other Coast Guard aircraft?

Direct price comparison is difficult without specific part numbers and quantities. However, spare parts for specialized helicopters like the MH-65, especially when procured under sole-source conditions due to non-availability, tend to be more expensive than common parts for widely used aircraft. The firm fixed-price nature provides some cost control, but the absence of competition means the government cannot leverage market dynamics to secure the lowest possible price. Benchmarking would require access to pricing data for similar specialized aviation components across different government contracts.

What are the potential risks associated with relying on a sole-source supplier for critical MH-65 spare parts?

The primary risks include potential price escalation over time, as the supplier faces no competitive pressure. There's also a risk of supply chain disruption if the sole-source manufacturer experiences production issues or decides to discontinue the part. Furthermore, the government may have less leverage in negotiating delivery schedules or terms. This reliance necessitates strong contract management and potentially proactive engagement with the supplier to mitigate these risks and ensure long-term availability.

What is the historical spending pattern for MH-65 spare parts by the U.S. Coast Guard?

Historical spending data for MH-65 spare parts would reveal trends in sustainment costs. Analyzing past contracts would show the volume and value of parts procured annually, identify key suppliers, and indicate whether spending has been consistent or fluctuating. This analysis could highlight periods of increased demand due to fleet age or operational tempo, and potentially reveal patterns of sole-source awards versus competitive procurements, providing context for the current $3.67 million award.

How does the 'Class Determination for Non-Availability Articles' impact the procurement process and cost?

This determination significantly impacts the procurement by allowing the acquisition of foreign-made articles when domestic sources are unavailable. It bypasses certain Buy American Act requirements. The impact on cost is generally an increase, as competitive domestic sourcing is forgone. The government must accept the pricing offered by the available foreign supplier, which may be higher than what could be achieved through competition. It also necessitates careful documentation and justification to ensure compliance with regulations.

Industry Classification

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

Product/Service Code: HARDWARE AND ABRASIVES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2701 N FORUM DR, GRAND PRAIRIE, TX, 75052

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $3,672,827

Exercised Options: $3,672,827

Current Obligation: $3,672,827

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70Z03821DB2000011

IDV Type: IDC

Timeline