FAA awarded $3.3M for a new Beechcraft King Air, including a trade-in, in 2009

Contract Overview

Contract Amount: $20,206,852 ($20.2M)

Contractor: Beechcraft Corporation

Awarding Agency: Department of Transportation

Start Date: 2009-06-22

End Date: 2010-09-08

Contract Duration: 443 days

Daily Burn Rate: $45.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: CLIN 001: NEW BEECHCRAFT KING AIR C-90GTI TURBO-PROP AIRCRAFT. TOTAL PRICE INCLUDES ALLOWANCE FOR TRADE-IN AIRCRAFT. AIRCRAFT TO BE TRADED IN FOR THIS LINE ITEM IS BE-200, N-12, SERIAL NUMBER BD-8. DELIVERY AND TRADE-IN WILL OCCUR IN OKLAHOMA CITY, OKLAHOMA. SEE SECTION C.10 FOR A LISTING OF OPTIONAL EQUIPMENT INCLUDED. SEE SECTION C.5 FOR A LISTING OF TRAINING ENTITLEMENTS INCLUDED. ALL AIRCRAFT DELIVERED ON THIS CONTRACT WILL BE KEYED ALIKE. CLIN 001 AIRCRAFT UNADJUSTED PRICE: $3,315,850.00 LESS AIRCRAFT TRADE-IN: $383,498.00 ADJUSTED PRICE: $2,932,352.00

Place of Performance

Location: WICHITA, SEDGWICK County, KANSAS, 67206

State: Kansas Government Spending

Plain-Language Summary

Department of Transportation obligated $20.2 million to BEECHCRAFT CORPORATION for work described as: CLIN 001: NEW BEECHCRAFT KING AIR C-90GTI TURBO-PROP AIRCRAFT. TOTAL PRICE INCLUDES ALLOWANCE FOR TRADE-IN AIRCRAFT. AIRCRAFT TO BE TRADED IN FOR THIS LINE ITEM IS BE-200, N-12, SERIAL NUMBER BD-8. DELIVERY AND TRADE-IN WILL OCCUR IN OKLAHOMA CITY, OKLAHOMA. SEE SECTION … Key points: 1. The contract's value is primarily driven by the acquisition of a new aircraft, with a significant portion allocated to a trade-in. 2. Competition dynamics appear robust, with the contract being awarded under full and open competition. 3. The fixed-price nature of the contract shifts performance risk to the contractor. 4. The contract duration of 443 days suggests a focused acquisition timeline. 5. The aircraft manufacturing sector is characterized by high barriers to entry and specialized production capabilities.

Value Assessment

Rating: fair

The unadjusted price of $3,315,850 for a new Beechcraft King Air C-90GTI is within a reasonable range for such specialized aircraft, considering market conditions in 2009. The trade-in value of $383,498 for a BE-200 appears to be a fair market assessment, reducing the net cost to $2,932,352. Benchmarking against similar sole-source or limited-competition aircraft procurements would be necessary for a more precise value-for-money assessment, but the full and open competition suggests a competitive pricing environment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of three bidders (no=3) suggests a healthy level of competition for this aircraft acquisition. This competitive environment is generally favorable for price discovery and achieving a fair market price for the government.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

The Federal Aviation Administration (FAA) benefits from the acquisition of a new aircraft for its operational needs. The contract delivers a new Beechcraft King Air C-90GTI turbo-prop aircraft, equipped with optional features and training. The delivery and trade-in are specified to occur in Oklahoma City, Oklahoma, potentially impacting local logistics and personnel. The acquisition supports the aviation manufacturing sector and associated workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if optional equipment or training costs exceed initial allowances.
Risk associated with the condition and valuation of the trade-in aircraft.
Dependence on a single manufacturer for specialized aircraft parts and maintenance.

Positive Signals

Awarded under full and open competition, suggesting competitive pricing.
Firm fixed-price contract structure limits the government's exposure to cost increases.
Inclusion of training entitlements enhances the utility and operational readiness of the new aircraft.

Sector Analysis

The contract falls within the Aircraft Manufacturing sector, a segment of the aerospace industry characterized by high technological sophistication and stringent regulatory requirements. The market for new turboprop aircraft like the Beechcraft King Air is relatively niche, with a limited number of manufacturers and models. Government procurements, particularly for specialized aviation assets, often represent significant portions of a manufacturer's order book. Comparable spending benchmarks would involve analyzing other government acquisitions of similar aircraft types or sizes.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb=false) and there is no explicit mention of small business subcontracting requirements. Therefore, the direct impact on the small business ecosystem is likely minimal, with the primary benefit accruing to the prime contractor, Beechcraft Corporation, which is a large business entity.

Oversight & Accountability

Oversight for this contract would typically be managed by the Federal Aviation Administration (FAA) contracting officer and administrative contracting officer. The firm fixed-price nature of the contract provides a degree of accountability by fixing the total cost. Transparency is facilitated by the public nature of federal contract awards, though detailed performance metrics are not provided in this summary. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Aircraft Procurement
Aviation Support Services
Transportation Infrastructure

Risk Flags

Potential for obsolescence of technology over the aircraft's lifecycle.
Dependence on a single manufacturer for critical parts and support.
Fluctuations in fuel prices could impact operational costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $20.2 million to BEECHCRAFT CORPORATION. CLIN 001: NEW BEECHCRAFT KING AIR C-90GTI TURBO-PROP AIRCRAFT. TOTAL PRICE INCLUDES ALLOWANCE FOR TRADE-IN AIRCRAFT. AIRCRAFT TO BE TRADED IN FOR THIS LINE ITEM IS BE-200, N-12, SERIAL NUMBER BD-8. DELIVERY AND TRADE-IN WILL OCCUR IN OKLAHOMA CITY, OKLAHOMA. SEE SECTION C.10 FOR A LISTING OF OPTIONAL EQUIPMENT INCLUDED. SEE SECTION C.5 FOR A LISTING OF TRAINING ENTITLEMENTS INCLUDED. ALL AIRCRAFT DELIVERED ON THIS CONTRACT WILL BE KEYED ALIKE. CLIN 001 AIRCRAFT UNADJUSTED PRICE

Who is the contractor on this award?

The obligated recipient is BEECHCRAFT CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $20.2 million.

What is the period of performance?

Start: 2009-06-22. End: 2010-09-08.

What is the historical spending pattern for similar aircraft procurements by the FAA?

Analyzing historical FAA spending on aircraft reveals a pattern of significant investments in aviation assets to support its mission. For instance, prior to this 2009 acquisition, the FAA would have procured various aircraft types for different purposes, such as flight inspection, research, and operational support. The specific model and configuration of the Beechcraft King Air C-90GTI suggest a need for a versatile platform capable of multi-mission roles. Historical data would likely show fluctuations in spending based on budget appropriations, fleet modernization needs, and the availability of suitable aircraft on the market. Comparing the $3.3 million price tag to previous acquisitions of similar turboprop aircraft, adjusted for inflation, would provide context on whether this procurement represented a fair market value at the time.

How does the trade-in value compare to the market value of a used Beechcraft BE-200 in 2009?

Determining the precise market value of a used Beechcraft BE-200 in 2009 requires access to historical aircraft sales data and appraisal reports from that period. However, the trade-in value of $383,498 suggests that the FAA's BE-200 was considered to have a certain residual value. Factors influencing this value would include the aircraft's age, total flight hours, maintenance history, avionics upgrades, and overall condition. If the market value was significantly higher, the government might have received a better return by selling the aircraft separately. Conversely, if the trade-in value was competitive with independent sales, it offered a convenient way to reduce the net cost of the new aircraft acquisition.

What are the specific performance requirements and operational uses for this Beechcraft King Air C-90GTI?

The specific performance requirements and operational uses for the Beechcraft King Air C-90GTI acquired by the FAA are not detailed in the provided data snippet. However, this aircraft model is known for its versatility and is commonly used for various missions, including executive transport, regional airline operations, special missions (such as surveillance or calibration), and cargo transport. Given the FAA's mandate, potential uses could include flight inspection of navigation aids, aerial surveys, research flights, or transport of personnel and equipment to remote locations. The inclusion of optional equipment and training entitlements would further tailor the aircraft to specific operational needs defined in the contract's Statement of Work (SOW).

What is the track record of Beechcraft Corporation in fulfilling government aircraft contracts?

Beechcraft Corporation, now part of Textron Aviation, has a long-standing history of supplying aircraft to government and military entities worldwide. Their King Air series, including the C-90GTI model, has been a popular choice for various government applications due to its reliability, versatility, and cost-effectiveness compared to larger jets. Historically, Beechcraft has demonstrated a strong capability in manufacturing and delivering aircraft that meet stringent government specifications. While specific performance on this particular contract (DCA) is not detailed here, the company's overall reputation in the aerospace industry suggests a generally positive track record in fulfilling complex aircraft procurement requirements for government agencies.

Were there any significant risks identified during the solicitation or award phase of this contract?

The provided data does not explicitly detail any significant risks identified during the solicitation or award phase of this contract. However, typical risks associated with aircraft procurement include technical risks (ensuring the aircraft meets all performance specifications), schedule risks (delays in delivery), cost risks (potential for cost growth, though mitigated by firm fixed-price), and contractor performance risks. Given that the contract was awarded under full and open competition with three bidders, it suggests that potential bidders assessed the risks as manageable and were willing to compete. The firm fixed-price contract structure itself is a mechanism to transfer certain cost and performance risks to the contractor.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Hawker Beechcraft, Inc. (UEI: 800097615)

Address: 9709 EAST CENTRAL AVE, WICHITA, KS, 04

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $98,660,000

Exercised Options: $23,346,352

Current Obligation: $20,206,852

Timeline