Coast Guard awards $6.88M for MH-65 aircraft spares, citing non-availability for sole-source procurement

Contract Overview

Contract Amount: $6,879,865 ($6.9M)

Contractor: Airbus Helicopters, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2026-01-15

End Date: 2028-04-11

Contract Duration: 817 days

Daily Burn Rate: $8.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PROCUREMENT OF VARIOUS SPARES 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.

Place of Performance

Location: GRAND PRAIRIE, TARRANT County, TEXAS, 75052

State: Texas Government Spending

Plain-Language Summary

Department of Homeland Security obligated $6.9 million to AIRBUS HELICOPTERS, INC. for work described as: PROCUREMENT OF VARIOUS SPARES 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. Key points: 1. Procurement of essential spares for MH-65 aircraft ensures operational readiness. 2. Sole-source award due to non-availability of articles suggests limited market options. 3. Contract duration of over two years indicates a sustained need for these parts. 4. Fixed-price contract type aims to control costs and provide predictability. 5. The specific nature of aircraft spares can create unique supply chain challenges. 6. Geographic location of contractor in Texas may influence logistics and delivery times.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific part details and market comparisons. The $6.88 million award over approximately two years for specialized aircraft spares suggests a significant investment in maintaining the MH-65 fleet. Given the sole-source nature, a direct comparison to competitive bids is not possible. However, the firm-fixed-price structure provides cost certainty for the Coast Guard. Further analysis would require understanding the criticality of these spares and the availability of alternative suppliers or repair solutions.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, citing FAR 25.103(b)(1) for non-availability of articles and a 'BAA Exception MTF'. This indicates that the contracting activity determined that only one responsible source was capable of providing the required spares. The lack of competition means that price discovery through market forces was bypassed, potentially leading to higher costs than if multiple bidders had participated.

Taxpayer Impact: The sole-source nature means taxpayers did not benefit from competitive pricing, and the government may have paid a premium for these essential aircraft parts.

Public Impact

The U.S. Coast Guard's MH-65 helicopter fleet benefits from the availability of critical spare parts. Ensures continued operational readiness for search and rescue, maritime law enforcement, and other critical missions. Supports the maintenance and longevity of vital aviation assets. Indirectly benefits the workforce that operates and maintains these aircraft.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially increasing costs for taxpayers.
Reliance on a single source for critical spares could create supply chain vulnerabilities.
Lack of detailed public information on the specific spares procured hinders value assessment.

Positive Signals

Firm-fixed-price contract provides cost certainty for the duration of the award.
Procurement ensures operational readiness of essential MH-65 aircraft.
Adherence to Federal Acquisition Regulation (FAR) for non-availability exceptions suggests a justified procurement process.

Sector Analysis

This contract falls within the broader aerospace and defense manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. The market for specialized aviation spares can be niche, often dominated by original equipment manufacturers (OEMs) or authorized distributors due to proprietary designs and strict quality control requirements. The U.S. Coast Guard's reliance on the MH-65 platform necessitates a secure supply chain for its components. Comparable spending benchmarks are difficult to establish without knowing the specific part numbers and quantities, but the overall value indicates a significant investment in fleet sustainment.

Small Business Impact

This contract does not appear to involve a small business set-aside, as indicated by 'sb: false'. Furthermore, the sole-source nature of the award limits opportunities for small businesses to participate as prime contractors or potentially as subcontractors, unless they are part of Airbus Helicopters' existing supply chain. The primary contractor, Airbus Helicopters, Inc., is a large business, suggesting that the direct economic impact on the small business ecosystem from this specific award is likely minimal.

Oversight & Accountability

Oversight for this contract would primarily reside with the U.S. Coast Guard contracting and program management offices. As a firm-fixed-price contract, the focus is on delivery of specified goods. Transparency is limited due to the sole-source nature and the 'non-availability' justification, which often involves proprietary or specialized information. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the procurement or execution phases.

Related Government Programs

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

Risk Flags

Sole-source justification requires careful scrutiny.
Potential for higher costs due to lack of competition.
Supply chain vulnerability associated with single-source provider.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $6.9 million to AIRBUS HELICOPTERS, INC.. PROCUREMENT OF VARIOUS SPARES 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.

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 $6.9 million.

What is the period of performance?

Start: 2026-01-15. End: 2028-04-11.

What is the specific nature of the 'non-availability articles' cited for this sole-source procurement, and what efforts were made to explore alternative sources?

The justification for sole-source procurement cites FAR 25.103(b)(1) and a 'BAA Exception MTF' (likely 'Broad Agency Announcement' or similar exception for technical/manufacturing feasibility). This typically means the required spare parts are either proprietary to the original manufacturer (Airbus Helicopters), subject to intellectual property restrictions, or not readily available from any other source that meets the government's technical and quality requirements. The contracting activity would have conducted market research to determine non-availability. However, the extent of this research and whether any potential alternative solutions (e.g., repair services, alternative part qualifications) were fully explored is not detailed in the provided data. The 'BAA Exception MTF' suggests a specific technical or manufacturing challenge that limits competition.

How does the pricing of these MH-65 spares compare to historical spending or industry benchmarks for similar aviation components?

Direct comparison of pricing is difficult without specific part numbers, quantities, and detailed specifications. The total award of $6.88 million over approximately 2.5 years (from award to estimated completion) averages around $2.75 million annually. Given that these are specialized spares for a military-grade helicopter, unit costs can be substantial. Historical spending data for the MH-65 program would be the most relevant benchmark, but this is not publicly available. Industry benchmarks for aviation spares vary widely based on complexity, material, and certification requirements. The firm-fixed-price nature provides cost certainty, but the sole-source justification implies that competitive benchmarking was not feasible, potentially leading to higher unit costs than a competed procurement.

What are the potential risks associated with relying on a sole-source provider for critical MH-65 aircraft spares?

The primary risk of a sole-source procurement for critical spares is the lack of competitive pressure, which can lead to inflated prices and reduced incentive for the supplier to innovate or improve efficiency. There's also a risk of supply chain disruption if the sole provider experiences production issues, financial instability, or decides to discontinue the product line. Furthermore, the government may have less leverage in negotiating terms or delivery schedules. For critical components like aircraft spares, this reliance can impact operational readiness if the supply chain is compromised. The Coast Guard likely mitigates some of this risk through contract clauses, performance monitoring, and maintaining strong relationships with the supplier.

What is the expected impact of this contract on the operational readiness and mission capabilities of the U.S. Coast Guard's MH-65 fleet?

This contract is crucial for maintaining the operational readiness of the U.S. Coast Guard's MH-65 helicopter fleet. The MH-65 is a versatile platform used for critical missions such as search and rescue, maritime law enforcement, port security, and environmental protection. By ensuring the availability of various necessary spare parts, this procurement directly supports the fleet's ability to perform these missions effectively and reliably. Consistent access to spares prevents aircraft downtime, reduces maintenance delays, and ensures that the helicopters are available when needed, thereby bolstering the Coast Guard's overall capability to execute its statutory responsibilities.

Can the 'BAA Exception MTF' provide insight into the specific technical challenges or manufacturing limitations that necessitate a sole-source award?

The 'BAA Exception MTF' likely refers to a justification based on Broad Agency Announcement (BAA) provisions, potentially related to 'Manufacturing Technology' or 'Manufacturing Feasibility'. This suggests that the procurement might be linked to developing or acquiring parts where specific manufacturing processes, advanced materials, or unique technological capabilities are required, and these are exclusively held or mastered by Airbus Helicopters. It could imply that standard manufacturing techniques are insufficient, or that the specific design requires specialized tooling or expertise only available from the original equipment manufacturer. This exception often serves to acquire cutting-edge technology or overcome complex production hurdles, thereby justifying a departure from full and open competition.

Industry Classification

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

Product/Service Code: MECHANICAL POWER TRANSMISSION EQPT

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: $6,879,865

Exercised Options: $6,879,865

Current Obligation: $6,879,865

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70Z03823DB0000035

IDV Type: IDC

Timeline