Naval Air Systems Command awards $192.7M for aircraft structural component repair to Sikorsky Aircraft Corporation

Contract Overview

Contract Amount: $192,720,096 ($192.7M)

Contractor: Sikorsky Aircraft Corporation

Awarding Agency: Department of Defense

Start Date: 2001-02-14

End Date: 2012-09-26

Contract Duration: 4,242 days

Daily Burn Rate: $45.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200508!231433!1700!N00019!NAVAL AIR SYSTEMS COMMAND !N0001901C0109 !A!N! !N!P00093 ! !20050510!20060213!835551474!835551474!001344142!N!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN STREET !STRATFORD !CT!06615!74260!001!09!STRATFORD !FAIRFIELD !CONN !+000000457656!N!N!000000000000!J015!MAINT & REPAIR OF EQ/AIRCRAFT STRUCTURAL COMPS !A1A!AIRFRAMES AND SPARES !000 !* !336411!E! !3!A!S! ! ! !20200930!B! ! !A! !A!N!J!2!005!B! !C!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! !1700!N00019!0001! !

Place of Performance

Location: STRATFORD, FAIRFIELD County, CONNECTICUT, 06614

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $192.7 million to SIKORSKY AIRCRAFT CORPORATION for work described as: 200508!231433!1700!N00019!NAVAL AIR SYSTEMS COMMAND !N0001901C0109 !A!N! !N!P00093 ! !20050510!20060213!835551474!835551474!001344142!N!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN STREET !STRATFORD !CT!06615!74260!001!09!STRATFORD !FAIR… Key points: 1. Contract value of over $192 million indicates significant long-term support needs for naval aircraft. 2. The contract was awarded under full and open competition, suggesting a competitive bidding process. 3. The duration of the contract (over 10 years) points to a stable, ongoing requirement for maintenance services. 4. Sikorsky Aircraft Corporation, a major aerospace manufacturer, is well-positioned to provide these specialized services. 5. The contract's focus on repair and structural components highlights the importance of maintaining fleet readiness. 6. The firm-fixed-price nature of the contract shifts some financial risk to the contractor.

Value Assessment

Rating: good

The total contract value of $192.7 million over its life appears reasonable for the scope of work, which involves the maintenance and repair of aircraft structural components. Benchmarking against similar long-term support contracts for naval aviation assets would provide a more precise value-for-money assessment. The firm-fixed-price contract type suggests that pricing was negotiated upfront, and the contractor bears the risk of cost overruns, which is generally favorable for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The data does not specify the number of bids received, but the competitive nature of the award process is expected to drive more favorable pricing and terms for the government compared to sole-source or limited competition scenarios.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to lower prices and higher quality services, ensuring the government receives the best value for its investment.

Public Impact

Naval aviation personnel and fleet readiness benefit from the sustained availability of well-maintained aircraft. The contract ensures the continued operational capability of critical naval aircraft structural components. The primary geographic impact is within the naval aviation infrastructure, supporting operations globally. The contract supports skilled jobs in aircraft maintenance and repair, likely concentrated in areas with significant aerospace industry presence.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen structural issues arise beyond the scope of initial estimates.
Dependence on a single contractor for critical structural repairs could lead to supply chain vulnerabilities.
Risk of contractor performance degradation over a long contract duration without continuous oversight.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Firm-fixed-price contract type shifts cost risk to the contractor.
Sikorsky Aircraft Corporation's established expertise in aircraft manufacturing and maintenance provides a strong foundation for performance.
Long contract duration indicates a stable and predictable requirement, allowing for efficient resource planning.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft maintenance, repair, and overhaul (MRO). The market for MRO services is substantial, driven by the need to maintain aging fleets and ensure operational readiness. Spending in this area is critical for national defense, supporting the longevity and reliability of military aviation assets. Comparable spending benchmarks would involve analyzing other large MRO contracts awarded by the Department of Defense for similar aircraft types or components.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large-scale contract awarded to a major aerospace corporation, it is unlikely to involve significant direct subcontracting opportunities for small businesses specifically for the core structural repair work. However, the prime contractor may engage small businesses for ancillary services or component supply, but this is not explicitly detailed in the contract information.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor compliance with contract terms, quality standards, and delivery schedules. Accountability measures are embedded in the firm-fixed-price structure, which incentivizes the contractor to manage costs effectively. Transparency is facilitated through contract databases like FPDS, though detailed performance metrics and specific oversight activities are often internal to the agency and contractor.

Related Government Programs

Naval Aviation Maintenance Program
Aircraft Structural Integrity Program
Defense Logistics Agency Aviation Support
Air Force Sustainment Center Contracts

Risk Flags

Long contract duration may increase risk of performance degradation or obsolescence.
Firm-fixed-price contracts can lead to change order growth if scope is not well-defined.
Dependence on a single large contractor for critical components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $192.7 million to SIKORSKY AIRCRAFT CORPORATION. 200508!231433!1700!N00019!NAVAL AIR SYSTEMS COMMAND !N0001901C0109 !A!N! !N!P00093 ! !20050510!20060213!835551474!835551474!001344142!N!SIKORSKY AIRCRAFT CORPORATION !6900 MAIN STREET !STRATFORD !CT!06615!74260!001!09!STRATFORD !FAIRFIELD !CONN !+000000457656!N!N!000000000000!J015!MAINT & REPAIR OF EQ/AIRCRAFT STRUCTURAL COMPS !A1A!AIRFRAMES AND SPARES !000 !* !336411!E! !3!A!S! ! ! !202

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 $192.7 million.

What is the period of performance?

Start: 2001-02-14. End: 2012-09-26.

What is Sikorsky Aircraft Corporation's track record with similar naval aviation maintenance contracts?

Sikorsky Aircraft Corporation, a subsidiary of Lockheed Martin, has a long and extensive history of supporting naval aviation. They are the original manufacturer of many naval helicopters, including the H-60 series (SH-60 Seahawk) and the CH-53 series. Their track record with maintenance and repair contracts is substantial, encompassing depot-level maintenance, component repair, and logistics support for these platforms. While this specific contract focuses on structural components, Sikorsky's deep familiarity with naval aircraft systems and structures, gained through decades of manufacturing and support, positions them as a highly capable provider. Historical performance data on their previous contracts, including on-time delivery rates, quality metrics, and cost performance, would be crucial for a comprehensive assessment, but their established role as a primary naval aircraft contractor suggests a generally positive and experienced relationship with the Navy.

How does the value of this contract compare to other aircraft structural repair contracts?

The $192.7 million total contract value over its approximately 11-year duration (from award date to estimated completion) represents a significant, but not unprecedented, investment in aircraft structural maintenance. Annualized, this contract averages roughly $17.5 million per year. To benchmark effectively, one would compare this to other large-scale, long-term sustainment contracts for naval aircraft components or airframes. For instance, contracts for depot maintenance, component overhaul, or structural repair for other naval platforms like the F/A-18, P-8 Poseidon, or various other helicopter types could serve as comparators. The specific nature of 'structural components' is broad; if it includes major airframe sections, the value is well within expected ranges for such critical sustainment activities. If it pertains to smaller, more numerous components, the value might be higher than average, warranting closer scrutiny of the scope and pricing.

What are the primary risks associated with this contract for the government?

The primary risks for the government in this contract revolve around performance and cost control over its extended duration. Firstly, there's a performance risk: ensuring Sikorsky consistently meets the required quality standards for structural repairs is paramount for flight safety and readiness. Any degradation in quality could lead to mission failures or increased future repair costs. Secondly, cost risk, although mitigated by the firm-fixed-price structure, still exists. If the scope of work expands unexpectedly due to unforeseen structural damage discovered during repairs, or if material costs escalate significantly beyond projections, the government might face pressure for contract modifications or additional funding. Lastly, there's a dependency risk; relying heavily on one contractor for critical structural repairs can create vulnerabilities if the contractor experiences financial distress, labor disputes, or strategic shifts that impact their ability to fulfill the contract.

How effective is the firm-fixed-price contract type in managing costs for this type of service?

The firm-fixed-price (FFP) contract type is generally considered effective for managing costs in services where the scope of work is well-defined and the risks are identifiable, such as the repair of aircraft structural components. Under an FFP agreement, the contractor assumes the primary responsibility for cost overruns. This incentivizes Sikorsky Aircraft Corporation to perform the work efficiently and control their expenses, as any savings achieved below the negotiated price benefit the contractor, while exceeding the price requires them to absorb the additional cost. This structure provides budget certainty for the Naval Air Systems Command. However, the effectiveness can be diminished if the initial scope definition is inadequate, leading to numerous change orders, or if unforeseen technical challenges arise that were not reasonably foreseeable during the bidding process, potentially necessitating contract modifications.

What are the historical spending patterns for aircraft structural repair and maintenance by the Navy?

Historical spending patterns for aircraft structural repair and maintenance by the Navy are substantial and tend to be consistent, reflecting the continuous need to sustain aging fleets and ensure operational readiness. The Navy operates a diverse and complex inventory of aircraft, including fixed-wing jets, helicopters, and specialized maritime patrol aircraft. Each platform requires ongoing maintenance, including structural inspections, repairs, and component replacements to address fatigue, corrosion, and damage. Spending in this category typically represents a significant portion of the overall naval aviation maintenance, repair, and overhaul (MRO) budget. Factors influencing these patterns include the age of the fleet, the introduction of new platforms, geopolitical demands, and evolving maintenance philosophies (e.g., shifting towards performance-based logistics). Contracts like this one, awarded over extended periods, are indicative of the Navy's long-term commitment to maintaining its aviation assets.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: RTX Corp (UEI: 001344142)

Address: 6900 MAIN STREET, STRATFORD, CT, 06615

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

Financial Breakdown

Contract Ceiling: $194,946,313

Exercised Options: $190,814,068

Current Obligation: $192,720,096

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline