DoD's $101M Boeing Sikorsky contract for aircraft support awarded without competition

Contract Overview

Contract Amount: $101,302,118 ($101.3M)

Contractor: Boeing Sikorsky Aircraft Support, LLC

Awarding Agency: Department of Defense

Start Date: 2022-01-01

End Date: 2022-12-31

Contract Duration: 364 days

Daily Burn Rate: $278.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TRAVEL

Place of Performance

Location: FORT CAMPBELL, CHRISTIAN County, KENTUCKY, 42223

State: Kentucky Government Spending

Plain-Language Summary

Department of Defense obligated $101.3 million to BOEING SIKORSKY AIRCRAFT SUPPORT, LLC for work described as: TRAVEL Key points: 1. Significant contract value raises questions about competitive sourcing and potential cost efficiencies. 2. Sole-source award limits market visibility and potential for price discovery. 3. Contract duration of one year suggests a need for ongoing support, but the lack of competition is notable. 4. The 'Other Support Activities for Air Transportation' category is broad and may encompass critical operational needs. 5. Focus on Special Operations Command indicates a specialized and potentially high-stakes requirement. 6. Firm Fixed Price contract type offers cost certainty but relies heavily on accurate initial pricing.

Value Assessment

Rating: questionable

The contract's value of over $101 million for a single year of aircraft support is substantial. Without a competitive bidding process, it is difficult to benchmark the value for money. Similar contracts for specialized aviation support can vary widely in price depending on the scope of services, aircraft types, and geographic locations. The firm fixed-price nature provides cost predictability, but the absence of competition means there's no direct market comparison to assess if this price represents optimal value or if alternative, more cost-effective solutions were overlooked.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Boeing Sikorsky Aircraft Support, LLC, was considered. This approach bypasses the standard competitive bidding process. While sole-source awards can be justified for unique capabilities or urgent needs, they inherently limit the number of potential suppliers and reduce the opportunity for market forces to drive down prices. The lack of competition means taxpayers do not benefit from the potential cost savings that can arise from multiple bidders vying for the contract.

Taxpayer Impact: The absence of competition means taxpayers may not be receiving the best possible price for these critical aircraft support services. Without competing bids, there is less pressure on the contractor to offer the most cost-effective solution.

Public Impact

U.S. Special Operations Command personnel and assets benefit from the continued operational readiness of aircraft. Services provided are crucial for maintaining the functionality and availability of specialized aircraft. The contract's impact is primarily national, supporting critical defense missions. Workforce implications are likely concentrated within Boeing Sikorsky Aircraft Support, LLC, and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition for a significant dollar amount raises concerns about potential overpricing and missed cost-saving opportunities.
Sole-source awards can indicate a lack of market research or a reliance on a single provider without exploring alternatives.
The broad 'Other Support Activities for Air Transportation' category could mask inefficiencies if not tightly managed.
Dependence on a single contractor for critical support can create long-term strategic risks.

Positive Signals

Firm Fixed Price contract type provides budget certainty for the government.
Award to a known entity like Boeing Sikorsky suggests a level of established capability and reliability.
Contract supports critical U.S. Special Operations Command missions, indicating a potentially high level of necessity.

Sector Analysis

The aerospace and defense sector is characterized by high barriers to entry, complex supply chains, and significant government reliance. Contracts for aircraft support, particularly for specialized military applications, often involve proprietary technology and extensive maintenance expertise. Spending in this area is substantial, with the Department of Defense being a primary customer. Benchmarks for such services are difficult to establish publicly due to the specialized nature and security requirements, but typically involve long-term sustainment and operational readiness contracts.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business subcontracting) flag is also false. This suggests that small businesses are unlikely to be directly involved as prime contractors or through mandated subcontracting opportunities on this specific award. The focus is on a large, established prime contractor, potentially limiting the flow-down of work to the small business ecosystem for this particular contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of the U.S. Special Operations Command contracting and program management offices. As a Department of Defense contract, it is also subject to oversight by the Department of Defense Inspector General. Transparency is limited due to the sole-source nature, but contract performance, invoicing, and adherence to terms would be monitored. The firm fixed-price structure simplifies some aspects of financial oversight by setting a clear ceiling.

Related Government Programs

DoD Aircraft Maintenance Contracts
Special Operations Aviation Support
Boeing Defense Contracts
Sikorsky Support Services
Air Transportation Support Services

Risk Flags

Sole-source award
Lack of competition
Broad service category

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $101.3 million to BOEING SIKORSKY AIRCRAFT SUPPORT, LLC. TRAVEL

Who is the contractor on this award?

The obligated recipient is BOEING SIKORSKY AIRCRAFT SUPPORT, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (U.S. Special Operations Command).

What is the total obligated amount?

The obligated amount is $101.3 million.

What is the period of performance?

Start: 2022-01-01. End: 2022-12-31.

What is the historical spending pattern for this specific type of aircraft support by the U.S. Special Operations Command?

Analyzing historical spending for similar aircraft support services by the U.S. Special Operations Command (SOCOM) is crucial for context. While the provided data is for a single year (2022) totaling $101.3 million, understanding trends over previous years would reveal if this represents an increase, decrease, or stable level of investment. For instance, if SOCOM previously awarded multiple competitive contracts for similar services totaling less than $101 million annually, this sole-source award warrants closer scrutiny regarding its value. Conversely, if this amount aligns with or is lower than previous competitive awards for comparable scope, it might suggest a reasonable, albeit uncompeted, price. Without access to SOCOM's historical contracting data for this specific service category, a definitive trend analysis is not possible, but it remains a key area for further investigation.

How does the per-unit cost of this contract compare to industry benchmarks for similar aircraft support services?

Determining a precise per-unit cost benchmark for this contract is challenging due to the broad nature of 'Other Support Activities for Air Transportation' and the sole-source award. Industry benchmarks for aircraft support vary significantly based on aircraft type (e.g., helicopter vs. fixed-wing), specific services (e.g., depot maintenance, line maintenance, logistics, training), and operational tempo. For specialized assets used by SOCOM, costs are often higher due to unique requirements and limited availability of expertise. A firm fixed price of $101.3 million for a year suggests a substantial operational tempo or scope. Without knowing the exact number of aircraft supported, flight hours, or specific maintenance actions covered, a direct per-unit comparison is speculative. However, the absence of competition means there's no direct market validation of this pricing against potential alternatives.

What specific risks are associated with a sole-source award of this magnitude for critical aviation support?

A sole-source award of $101.3 million for critical aviation support introduces several risks. Firstly, there's a heightened risk of 'cost-plus' inefficiencies, where the contractor may not be incentivized to control costs as rigorously as in a competitive environment, potentially leading to overpayment by the government. Secondly, reliance on a single provider can create vendor lock-in, making it difficult and costly to switch providers in the future, even if performance or pricing becomes unsatisfactory. Thirdly, the lack of competition limits the government's visibility into the broader market capabilities and pricing structures, potentially missing out on innovative solutions or more cost-effective approaches offered by other qualified vendors. Finally, there's a reputational risk if the award is perceived as lacking transparency or fairness, potentially impacting future procurement processes.

What is Boeing Sikorsky Aircraft Support, LLC's track record with similar sole-source contracts, particularly within the Department of Defense?

Boeing Sikorsky Aircraft Support, LLC, as a major defense contractor, likely has a history of receiving various contract types, including sole-source awards, particularly for specialized systems where they hold unique expertise or are the original equipment manufacturer. Analyzing their specific track record with sole-source contracts of similar magnitude within the Department of Defense (DoD) is essential. This would involve reviewing past performance evaluations, any documented issues related to cost overruns or performance deficiencies on prior sole-source agreements, and the frequency with which they are awarded non-competitively. A history of successful, well-managed sole-source contracts might mitigate some concerns, whereas a pattern of issues would amplify them. Without specific data on their sole-source history, it's presumed they possess the necessary qualifications, but the justification and execution of such awards remain critical.

How does the 'Other Support Activities for Air Transportation' classification potentially obscure the specific services being procured?

The classification 'Other Support Activities for Air Transportation' (PSC 488190) is quite broad and can encompass a wide range of services beyond simple maintenance. This could include logistics support, technical data management, engineering services, training, ground support equipment, and even modifications or upgrades. The vagueness of this category, especially in a sole-source context, presents a challenge for transparency and detailed performance assessment. It allows for flexibility but also makes it difficult for external observers, and potentially even internal oversight bodies, to fully understand the specific deliverables, associated costs, and whether the funds are being used for the most critical or cost-effective activities. A more specific classification would typically provide clearer insight into the nature of the support being acquired.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: H9224116R0004

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 7244B NIGHTSTALKER WAY, FORT CAMPBELL, KY, 42223

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $101,314,109

Exercised Options: $101,314,109

Current Obligation: $101,302,118

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: H9224119D0003

IDV Type: IDC

Timeline