Sikorsky Aircraft awarded $835M for UH-60 Black Hawk helicopter airframes and spares

Contract Overview

Contract Amount: $2,235,513,402 ($2.2B)

Contractor: Sikorsky Aircraft Corporation

Awarding Agency: Department of Defense

Start Date: 1997-07-18

End Date: 2011-09-10

Contract Duration: 5,167 days

Daily Burn Rate: $432.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 199712!2100!1180!AJ09 !USA AVIATION AND TROOP COMMAND !DAAJ0997C0005 !A!*!* !19970718!20030730!835551474!835551474!001344142!N!78286!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN ST !STRATFORD !CT!06614!74260!001!09!STRATFORD !FAIRFIELD !CONN !0001!+000227816346!N!N!000000000000!1520!AIRCRAFT ROTARY WING !A1A!AIRFRAMES AND SPARES !1AIA!BLACKHAWK (UH-60) UTTAS !3721!3!*!*!*!B!A!*!D !N!J!1!001!N!1A!A!Y!A!* !* !N!C!*!A!A!A!A!A!*!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: STRATFORD, FAIRFIELD County, CONNECTICUT, 06614

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $2.24 billion to SIKORSKY AIRCRAFT CORPORATION for work described as: 199712!2100!1180!AJ09 !USA AVIATION AND TROOP COMMAND !DAAJ0997C0005 !A!*!* !19970718!20030730!835551474!835551474!001344142!N!78286!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN ST !STRATFORD !CT!06614!74260!001!09!STRATFORD !FAIRFI… Key points: 1. Contract awarded for critical aircraft components, indicating a sustained need for rotary-wing airframes. 2. The contract's duration spans over 14 years, suggesting long-term fleet support requirements. 3. A significant portion of the contract value was obligated, demonstrating immediate and substantial investment. 4. The sole-source nature of the award warrants scrutiny regarding potential cost efficiencies and market alternatives. 5. The contractor, Sikorsky Aircraft Corporation, is a well-established entity in the aerospace sector, implying a degree of reliability. 6. The contract falls under the 'Aircraft Rotary Wing' product service code, highlighting its specific military aviation focus.

Value Assessment

Rating: fair

The total value of $835,551,474 over a period of approximately 14 years suggests an average annual spend of roughly $60 million. Without specific benchmarks for UH-60 airframe and spare parts, it's challenging to definitively assess value for money. However, the long duration and sole-source nature could indicate a premium was paid compared to a competitively bid scenario. Further analysis would require comparing unit costs for similar components or services procured through competitive means.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning that only one contractor, Sikorsky Aircraft Corporation, was solicited. This approach is typically used when a unique capability or proprietary technology is required, or in situations where only one source is available. The lack of competition means that the government did not benefit from the price discovery mechanisms inherent in a multi-bidder environment, potentially leading to higher costs.

Taxpayer Impact: Taxpayers may have paid a higher price due to the absence of competitive bidding. The government's ability to negotiate the best possible price was limited without alternative offers.

Public Impact

The primary beneficiaries are the U.S. Army and potentially other branches of the military relying on the UH-60 Black Hawk helicopter fleet. The contract delivers essential airframes and spare parts, crucial for maintaining the operational readiness and safety of these vital aircraft. The geographic impact is national, supporting military operations across various theaters and domestic bases. Workforce implications include continued employment for engineers, technicians, and manufacturing personnel at Sikorsky Aircraft Corporation and its supply chain partners.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Long contract duration could mask inefficiencies if not actively managed and reviewed.
Lack of transparency in the sole-source justification requires careful examination.
Potential for cost overruns if pricing mechanisms are not robustly defined and monitored.

Positive Signals

Contract awarded to a known and established manufacturer of the UH-60 Black Hawk.
Significant funding obligated suggests a clear and ongoing need for these critical components.
The contract ensures the continued availability of essential parts for a key military asset.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on military aircraft components. The market for rotary-wing aircraft and their associated parts is dominated by a few major manufacturers. Sikorsky Aircraft Corporation is a key player in this market, particularly for the Black Hawk platform. Spending benchmarks for similar long-term sustainment contracts for major weapon systems can range from hundreds of millions to billions of dollars, depending on the system's criticality and fleet size.

Small Business Impact

There is no indication from the provided data that this contract included small business set-asides or subcontracting plans. As a sole-source award to a large corporation, the direct impact on small businesses is likely minimal unless Sikorsky actively engages them in its supply chain. Further investigation into Sikorsky's subcontracting practices would be needed to assess the broader impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management structures, potentially involving the Defense Contract Management Agency (DCMA) for contract administration. Inspector General (IG) offices within the DoD would have jurisdiction to investigate any allegations of fraud, waste, or abuse. Transparency is limited due to the sole-source nature, but contract awards are generally reported in federal procurement databases.

Related Government Programs

UH-60 Black Hawk Helicopter Program
Rotary Wing Aircraft Procurement
Aviation Systems Sustainment
Defense Logistics Agency (DLA) Parts Procurement
Military Aircraft Maintenance and Repair

Risk Flags

Sole-source award
Long contract duration
Lack of competitive bidding
Potential for cost overruns
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $2.24 billion to SIKORSKY AIRCRAFT CORPORATION. 199712!2100!1180!AJ09 !USA AVIATION AND TROOP COMMAND !DAAJ0997C0005 !A!*!* !19970718!20030730!835551474!835551474!001344142!N!78286!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN ST !STRATFORD !CT!06614!74260!001!09!STRATFORD !FAIRFIELD !CONN !0001!+000227816346!N!N!000000000000!1520!AIRCRAFT ROTARY WING !A1A!AIRFRAMES AND SPARES !1AIA!BLACKHAWK (UH-60) UTTAS !3721!3!*!*!*!B!A!*!D !N!J!1!0

Who is the contractor on this award?

The obligated recipient is SIKORSKY AIRCRAFT CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $2.24 billion.

What is the period of performance?

Start: 1997-07-18. End: 2011-09-10.

What was the specific justification for awarding this contract on a sole-source basis to Sikorsky Aircraft Corporation?

The provided data does not contain the specific justification for the sole-source award. Typically, sole-source contracts are justified under circumstances such as urgency, unique capabilities, or when only one responsible source exists. For a critical platform like the UH-60 Black Hawk, the justification might relate to proprietary technology, specialized tooling, or the need for seamless integration with existing aircraft configurations. A thorough review of the contract file and associated documentation would be necessary to ascertain the precise rationale provided by the procuring agency at the time of award.

How does the total contract value of $835.5 million compare to historical spending on UH-60 Black Hawk airframes and spares?

The provided data indicates a total contract value of $835,551,474 for airframes and spares for the UH-60 Black Hawk. To compare this to historical spending, one would need access to historical procurement data for the UH-60 program, broken down by component type (airframes, spares) and contract type (competitive vs. sole-source). This contract, awarded in 1997 and ending in 2011, represents a significant investment over its 14-year period. Without comparative data on unit costs or total program spending across different contract vehicles, it's difficult to definitively state whether this represents high or low spending relative to historical trends. However, the sheer magnitude suggests a substantial commitment to maintaining the Black Hawk fleet.

What are the potential risks associated with a sole-source contract of this magnitude and duration?

The primary risk associated with a sole-source contract of this magnitude and duration is the potential for inflated costs due to the lack of price competition. Without competing bids, the government has less leverage to negotiate favorable pricing. Other risks include vendor lock-in, where the government becomes overly reliant on a single supplier, potentially limiting future flexibility and innovation. There's also a risk of complacency from the contractor, assuming continued business without the pressure to optimize efficiency or quality. Furthermore, if the contractor faces financial difficulties or operational issues, it could significantly disrupt the supply of critical components, impacting military readiness.

What performance metrics or oversight mechanisms were likely in place to ensure contractor performance and value?

While specific performance metrics are not detailed in the provided data, contracts of this nature typically include clauses for quality assurance, delivery schedules, and technical compliance. The Defense Contract Management Agency (DCMA) would likely have been involved in administering the contract, monitoring contractor performance, and ensuring adherence to contract terms. Performance would be assessed against technical specifications for the airframes and spares, delivery timelines, and potentially warranty provisions. The government would also likely have mechanisms for reviewing invoices and payments to ensure they align with contract requirements and progress.

How does the product service code (PSC) '1520' for Aircraft Rotary Wing align with the contract's description?

The Product Service Code (PSC) '1520' specifically designates 'Aircraft Rotary Wing' equipment. This aligns perfectly with the contract's description, which explicitly mentions 'AIRCRAFT ROTARY WING' and the specific model 'BLACKHAWK (UH-60) UTTAS'. PSC codes are used by the federal government to classify the types of products and services being procured. Therefore, the assignment of PSC 1520 confirms that the contract's purpose is directly related to the acquisition or sustainment of rotary-wing aircraft components, specifically for the UH-60 Black Hawk helicopter.

What is the significance of the contract award date (1997-07-18) and the period of performance (ending 2011-09-10)?

The award date of July 18, 1997, places this contract firmly within the late 1990s procurement landscape. The period of performance extending to September 10, 2011, indicates a contract duration of over 14 years. This extended timeframe suggests a long-term sustainment strategy for the UH-60 Black Hawk fleet, covering multiple budget cycles and potentially evolving operational requirements. Such long-term contracts are often used for major weapon systems to ensure a stable supply chain and predictable costs for critical components over an extended period, reflecting the longevity of the platforms they support.

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 6900 MAIN ST, STRATFORD, CT, 06614

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline