DoD's $124M F-15 modernization contract for Saudi Arabia awarded to Perini Management Services, Inc

Contract Overview

Contract Amount: $124,241,786 ($124.2M)

Contractor: Perini Management Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2018-12-13

End Date: 2023-03-31

Contract Duration: 1,569 days

Daily Burn Rate: $79.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: F-15 FLEET MODERNIZATION PROGRAM, ROYAL SAUDI AIR FORCE AIR WARFARE CENTER, PROJECT AT KING ABDULAZIZ AIR BASE, DHAHRAN KINGDOM OF SAUDI ARABIA (KSA)

Plain-Language Summary

Department of Defense obligated $124.2 million to PERINI MANAGEMENT SERVICES, INC. for work described as: F-15 FLEET MODERNIZATION PROGRAM, ROYAL SAUDI AIR FORCE AIR WARFARE CENTER, PROJECT AT KING ABDULAZIZ AIR BASE, DHAHRAN KINGDOM OF SAUDI ARABIA (KSA) Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of over 4 years indicates a significant, long-term project. 3. The firm-fixed-price nature of the contract shifts cost risk to the contractor. 4. This project supports the modernization of a key allied air force's capabilities. 5. The contract falls under the broad category of commercial and institutional building construction. 6. The award value suggests a substantial investment in infrastructure and support services.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its specific nature supporting a foreign military sale. However, the total award of over $124 million for a multi-year modernization program indicates a significant investment. Without comparable international military construction contracts or detailed cost breakdowns, a precise value-for-money assessment is difficult. The firm-fixed-price structure aims to control costs, but the overall efficiency depends on project execution and the contractor's ability to manage resources effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. This typically fosters a competitive environment, potentially leading to better pricing and terms for the government. The presence of 4 bidders, as indicated by the 'no' field, suggests a reasonable level of competition for this specialized project.

Taxpayer Impact: Full and open competition generally benefits taxpayers by promoting market-driven pricing and encouraging contractors to offer their best value propositions.

Public Impact

The primary beneficiaries are the Royal Saudi Air Force, receiving modernized F-15 capabilities. Services delivered include construction and potentially support for air warfare center operations. The geographic impact is concentrated at King Abdulaziz Air Base in Saudi Arabia. Workforce implications may include employment opportunities for construction and support personnel, both locally and potentially for the contractor's staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if project scope expands beyond initial estimates.
Geopolitical risks associated with foreign military sales and regional stability.
Dependence on contractor's ability to manage complex international logistics and construction.
Ensuring compliance with all host nation regulations and security protocols.

Positive Signals

Firm-fixed-price contract helps control costs and provides budget certainty.
Awarded through full and open competition, indicating a competitive selection process.
Long contract duration allows for phased execution and comprehensive modernization.
Supports a key U.S. ally's military modernization efforts, enhancing regional security cooperation.

Sector Analysis

This contract falls within the Defense sector, specifically related to military construction and support services for aviation assets. The market for such specialized international military modernization projects is often limited to a few large, experienced defense contractors. Spending benchmarks are difficult to establish without direct comparisons to similar foreign military sales projects, but the scale of the award suggests a significant investment in maintaining and upgrading advanced air combat capabilities.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. Given the scale and specialized nature of the project, it is likely that the prime contractor, Perini Management Services, Inc., would manage subcontracting opportunities. Analysis of subcontracting plans and their impact on the small business ecosystem would require further data on the contractor's subcontracting practices.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense, specifically the Department of the Air Force, which awarded the contract. Accountability measures are inherent in the firm-fixed-price contract type, which places cost responsibility on the contractor. Transparency would be facilitated through contract reporting mechanisms, though specific details of project execution and oversight might be subject to national security considerations and foreign partner agreements.

Related Government Programs

Foreign Military Sales (FMS) Program
F-15 Aircraft Sustainment and Modernization Programs
Defense Infrastructure and Construction Contracts
Middle East Security Cooperation Initiatives

Risk Flags

Geopolitical Risk
Foreign Military Sales Complexity
Overseas Construction Logistics
Potential for Scope Creep

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $124.2 million to PERINI MANAGEMENT SERVICES, INC.. F-15 FLEET MODERNIZATION PROGRAM, ROYAL SAUDI AIR FORCE AIR WARFARE CENTER, PROJECT AT KING ABDULAZIZ AIR BASE, DHAHRAN KINGDOM OF SAUDI ARABIA (KSA)

Who is the contractor on this award?

The obligated recipient is PERINI MANAGEMENT SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $124.2 million.

What is the period of performance?

Start: 2018-12-13. End: 2023-03-31.

What is the track record of Perini Management Services, Inc. in executing large-scale international defense construction projects?

Perini Management Services, Inc. (PMSI) has a history of performing large-scale construction and facilities management projects, often for government clients, including significant work in overseas locations. Their experience includes projects for the Department of Defense and other federal agencies, often involving complex logistical challenges and demanding security requirements. While specific details on their F-15 modernization support for the Royal Saudi Air Force are limited in the public domain, their general portfolio suggests a capability to handle such undertakings. A deeper dive into their past performance on similar international defense contracts, including any reported issues or successes, would provide a more robust assessment of their suitability for this specific project.

How does the cost of this F-15 modernization program compare to similar international military modernization efforts?

Direct cost comparisons for international military modernization programs are inherently difficult due to variations in scope, technology, geopolitical contexts, and the specific needs of each partner nation. This $124 million contract for the F-15 fleet modernization program for the Royal Saudi Air Force is a substantial investment. However, without detailed breakdowns of what specific upgrades, services, and infrastructure are included, it's challenging to benchmark against other F-15 modernization efforts or similar programs for other aircraft types in different regions. Factors such as the extent of avionics upgrades, structural enhancements, weapons system integration, and associated facility construction all influence the total cost. The firm-fixed-price nature aims for cost control, but the overall value is realized through effective project execution and the resulting enhancement of air combat capabilities.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks for this contract include geopolitical instability in the region, potential for scope creep leading to cost overruns despite the fixed-price nature, and logistical challenges inherent in overseas construction projects. Mitigation strategies likely involve robust project management by Perini Management Services, Inc., close coordination with the Department of the Air Force and the host nation (Saudi Arabia), and adherence to strict security protocols. The firm-fixed-price contract itself is a risk mitigation tool, placing the onus of cost control on the contractor. Furthermore, the long-term nature of the contract allows for phased execution, potentially enabling adjustments based on evolving security landscapes or operational requirements.

What is the expected impact of this contract on the operational effectiveness of the Royal Saudi Air Force's F-15 fleet?

The F-15 fleet modernization program is designed to significantly enhance the operational effectiveness of the Royal Saudi Air Force's F-15 aircraft. Modernization typically involves upgrading avionics, radar systems, electronic warfare capabilities, and potentially integrating new weapons systems. These enhancements aim to improve situational awareness, target acquisition, survivability, and overall combat performance, ensuring the F-15s remain a potent air-to-air and air-to-ground platform capable of meeting contemporary threats. The contract's focus on modernization suggests an effort to extend the service life of the fleet and maintain its technological edge in the region.

How does this contract fit into the broader context of U.S. foreign military sales and security cooperation in the Middle East?

This contract is a component of the broader U.S. strategy to support key regional partners through Foreign Military Sales (FMS). By providing advanced military equipment and modernization services, the U.S. aims to enhance the defense capabilities of allies like Saudi Arabia, contributing to regional stability and counter-terrorism efforts. Modernizing the F-15 fleet, a cornerstone of many air forces, ensures that allied air power remains interoperable with U.S. forces and capable of addressing shared security challenges. Such sales also support the U.S. defense industrial base through the work performed by contractors like Perini Management Services, Inc.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tutor Perini Corporation

Address: 73 MOUNT WAYTE AVE, FRAMINGHAM, MA, 01702

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $124,241,786

Exercised Options: $124,241,786

Current Obligation: $124,241,786

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA890317D0044

IDV Type: IDC

Timeline