DoD's $106.6M Aircraft Manufacturing Contract with Honeywell Faces Scrutiny Over Competition and Value
Contract Overview
Contract Amount: $106,569,655 ($106.6M)
Contractor: Honeywell International Inc.
Awarding Agency: Department of Defense
Start Date: 2008-11-03
End Date: 2013-05-28
Contract Duration: 1,667 days
Daily Burn Rate: $63.9K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: GMAV UCA
Place of Performance
Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87113
Plain-Language Summary
Department of Defense obligated $106.6 million to HONEYWELL INTERNATIONAL INC. for work described as: GMAV UCA Key points: 1. The contract awarded to Honeywell International Inc. for aircraft manufacturing represents a significant expenditure. 2. The competition method, 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' warrants closer examination for potential limitations. 3. The contract's duration of 1667 days suggests a long-term commitment with potential for cost escalation. 4. The lack of small business participation is noted, potentially limiting broader economic impact. 5. The specific nature of the aircraft manufacturing and its role within the Department of Defense is key to understanding its value.
Value Assessment
Rating: fair
The contract's total value of $106.6 million over 1667 days needs to be benchmarked against similar aircraft manufacturing contracts. Without specific unit details or performance metrics, assessing the value for money is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The competition was conducted as 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This suggests that while open competition was intended, certain sources were excluded, potentially impacting the price discovery and the final negotiated price.
Taxpayer Impact: The exclusion of sources in the competition process may have led to a higher price than could have been achieved through unrestricted open competition, impacting taxpayer funds.
Public Impact
Taxpayers may be paying more due to the exclusion of certain potential bidders in the contract's competitive process. The long-term nature of the contract could impact the DoD's flexibility in adopting newer technologies or seeking more cost-effective solutions. The absence of small business involvement means potential economic benefits are concentrated among larger corporations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition due to source exclusion
- Lack of small business participation
- Long contract duration
- Unclear value for money without unit cost analysis
Positive Signals
- Awarded to a known entity (Honeywell International Inc.)
- Contract falls under the Department of Defense, a critical sector
Sector Analysis
This contract falls within the Defense sector, specifically Aircraft Manufacturing. Spending in this area is crucial for national security but is also subject to high costs and technological advancements. Benchmarks for similar large-scale aircraft manufacturing contracts are essential for evaluating this award.
Small Business Impact
The contract data indicates that small businesses were not involved in this award (sb: false). This suggests that the procurement was likely geared towards large, established aerospace manufacturers capable of fulfilling complex defense requirements.
Oversight & Accountability
The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' clause requires careful oversight to ensure the exclusion was justified and did not unduly restrict competition. The Department of Defense's Contract Management Agency is responsible for monitoring performance and adherence to contract terms.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for inflated costs due to limited competition
- Lack of transparency in source exclusion
- Absence of small business participation
- Long contract duration may reduce flexibility
- Need for detailed cost-benefit analysis
Tags
aircraft-manufacturing, department-of-defense, nm, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $106.6 million to HONEYWELL INTERNATIONAL INC.. GMAV UCA
Who is the contractor on this award?
The obligated recipient is HONEYWELL INTERNATIONAL INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $106.6 million.
What is the period of performance?
Start: 2008-11-03. End: 2013-05-28.
What was the justification for excluding specific sources from the competition, and how did this exclusion impact the final price compared to a fully open bid?
The justification for excluding sources is critical. If the exclusion was based on specialized capabilities or security requirements, it might be defensible. However, if it was arbitrary, it could have artificially limited competition, leading to a higher price for taxpayers. A thorough review of the procurement documentation is needed to assess the validity of the exclusion and its financial implications.
How does the per-unit cost or performance metric of the aircraft manufactured under this contract compare to industry benchmarks for similar platforms?
Assessing the value for money requires comparing the contract's performance against industry standards. Without specific data on unit costs, production rates, or key performance indicators, it's difficult to determine if the $106.6 million expenditure represents a fair price. Benchmarking against comparable aircraft programs, considering technological sophistication and operational requirements, is essential for a robust value assessment.
What is the strategic importance of this specific aircraft manufacturing contract to the Department of Defense's overall mission readiness and future capabilities?
The strategic importance hinges on the role of the manufactured aircraft. If these are critical platforms for current operations or essential for future defense strategies, the investment is justified. However, if the technology is aging or alternative solutions exist, the long-term value might be questionable. Understanding the operational necessity and the platform's lifecycle is key to evaluating its effectiveness.
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 AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Honeywell International Inc (UEI: 139691877)
Address: 9201 SAN MATEO BLVD. NE, ALBUQUERQUE, NM, 87113
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $106,673,604
Exercised Options: $106,584,104
Current Obligation: $106,569,655
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2008-11-03
Current End Date: 2013-05-28
Potential End Date: 2013-05-28 00:00:00
Last Modified: 2017-03-31
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