DoD awards $10.1M for MV-22 Osprey processor replacements and repairs to Honeywell International Inc

Contract Overview

Contract Amount: $10,126,615 ($10.1M)

Contractor: Honeywell International Inc.

Awarding Agency: Department of Defense

Start Date: 2023-12-01

End Date: 2028-10-27

Contract Duration: 1,792 days

Daily Burn Rate: $5.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MV-22 TCAS PROCESSOR REPLACEMENTS AND REPAIRS

Place of Performance

Location: OLATHE, JOHNSON County, KANSAS, 66061

State: Kansas Government Spending

Plain-Language Summary

Department of Defense obligated $10.1 million to HONEYWELL INTERNATIONAL INC. for work described as: MV-22 TCAS PROCESSOR REPLACEMENTS AND REPAIRS Key points: 1. Contract awarded to a single, established supplier, raising questions about competitive pricing. 2. The fixed-price contract type offers some cost certainty but may limit upside for the government if costs decrease. 3. The duration of the contract (nearly 5 years) suggests a long-term need for these critical aircraft components. 4. The award is for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing,' indicating a specialized niche. 5. The contract is a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework.

Value Assessment

Rating: fair

The contract value of $10.1 million for processor replacements and repairs for the MV-22 Osprey appears to be within a reasonable range for specialized aerospace components. However, without direct comparable contract data for similar processor repair services or specific unit cost benchmarks, a definitive value-for-money assessment is challenging. The fixed-price nature of the contract provides cost predictability for the government, but it's crucial to ensure that the pricing reflects fair market value given the lack of competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Honeywell International Inc., was solicited. This approach is typically used when a product or service is unique and only available from a single source, or in cases of urgent need where competition is not feasible. The lack of competition means there was no opportunity for price discovery through bidding, potentially leading to higher costs for the government compared to a competed contract.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive bidding. Without multiple offers, there's less assurance that the negotiated price represents the best possible value.

Public Impact

The primary beneficiaries are the U.S. Department of the Navy and the broader Department of Defense, ensuring the continued operational readiness of the MV-22 Osprey fleet. The services delivered include the replacement and repair of critical processors, essential for the aircraft's complex systems. The geographic impact is primarily within the United States, with potential implications for military bases operating the MV-22. Workforce implications include the need for specialized technicians at Honeywell to perform these repairs and the military personnel who operate and maintain the aircraft.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Lack of transparency in the sole-source justification process could obscure potential alternatives.
Long contract duration without competitive review may not capture cost savings from market shifts.
Reliance on a single supplier for critical components poses a supply chain risk.

Positive Signals

Award to a known entity (Honeywell) suggests familiarity with their capabilities and product.
Fixed-price contract provides budget certainty for the awarded amount.
Focus on essential aircraft component repair ensures operational readiness of a key military asset.

Sector Analysis

The 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector is highly specialized, often dominated by a few key players with proprietary knowledge and manufacturing capabilities. Honeywell International Inc. is a significant defense contractor with extensive experience in aerospace systems. This contract fits within the broader defense industrial base, specifically supporting the sustainment of complex aviation platforms like the MV-22 Osprey. Benchmarking spending in this niche is difficult without access to proprietary cost data or specific contract details for similar repair services.

Small Business Impact

This contract does not appear to involve small business set-asides, as indicated by `ss: false` and `sb: false`. The award is made directly to Honeywell International Inc., a large corporation. There is no explicit information regarding subcontracting opportunities for small businesses within this specific award, though large defense contractors often have subcontracting plans for broader programs.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial oversight mechanisms. The Defense Contract Management Agency (DCMA) likely plays a role in monitoring performance and compliance. Inspector General (IG) jurisdiction would apply in cases of suspected fraud, waste, or abuse. Transparency is limited due to the sole-source nature, but contract award data is publicly available through federal procurement databases.

Related Government Programs

MV-22 Osprey Sustainment Contracts
Aerospace Component Repair Services
Department of Defense Aircraft Maintenance
Honeywell Defense Contracts
Sole-Source Defense Procurements

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for cost overruns
Supply chain dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.1 million to HONEYWELL INTERNATIONAL INC.. MV-22 TCAS PROCESSOR REPLACEMENTS AND REPAIRS

Who is the contractor on this award?

The obligated recipient is HONEYWELL INTERNATIONAL INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $10.1 million.

What is the period of performance?

Start: 2023-12-01. End: 2028-10-27.

What is Honeywell's track record with MV-22 Osprey components and similar defense contracts?

Honeywell International Inc. is a major defense contractor with a long history of supplying and supporting aerospace systems, including components for the MV-22 Osprey. Their track record typically involves providing a wide range of avionics, engines, and other critical systems for various military aircraft. For the MV-22 program specifically, Honeywell has been a key supplier of components such as the engine control systems and other avionics. Their experience in this domain suggests a deep understanding of the technical requirements and operational demands associated with these complex aircraft. Publicly available data often highlights their role in delivering and maintaining these systems, though specific performance metrics for individual contracts are not always disclosed.

How does the $10.1 million contract value compare to similar processor repair contracts in the defense sector?

Directly comparing the $10.1 million value for MV-22 Osprey processor replacements and repairs to similar contracts is challenging due to the specialized nature of the components and the sole-source award. Contracts for aerospace component repair can vary significantly based on the complexity of the system, the specific parts involved, labor rates, and the volume of repairs. Typically, sole-source awards may be higher than competitively bid contracts. Without access to a database of comparable sole-source or competitively bid repair contracts for similar avionics processors on other military aircraft platforms, it's difficult to establish a precise benchmark. However, given the critical nature and advanced technology of the MV-22, a multi-million dollar contract for sustainment over several years is not unusual within the defense aerospace industry.

What are the primary risks associated with a sole-source award for critical aircraft components?

The primary risks associated with a sole-source award for critical aircraft components like MV-22 Osprey processors include potential overpricing, reduced incentive for innovation, and supply chain vulnerability. Without competition, the government lacks the leverage to negotiate the lowest possible price, potentially leading to higher costs for taxpayers. The sole provider may have less incentive to invest in process improvements or cost-saving innovations if they are guaranteed the contract. Furthermore, relying on a single supplier creates a significant risk; any disruption to that supplier's operations (e.g., due to financial issues, natural disasters, or geopolitical events) could severely impact the availability of essential parts and the operational readiness of the aircraft fleet.

How does this contract contribute to the overall effectiveness and readiness of the MV-22 Osprey program?

This contract is crucial for maintaining the operational effectiveness and readiness of the MV-22 Osprey program. The MV-22 is a unique tiltrotor aircraft used for various missions, including troop transport, cargo delivery, and special operations. Its complex avionics and processing systems require regular maintenance, repair, and replacement of components to ensure reliability and safety. By securing the necessary processor replacements and repairs through this contract with Honeywell, the Department of the Navy ensures that these critical aircraft can continue to perform their demanding missions without significant downtime. This directly supports the warfighter and the overall strategic capabilities enabled by the MV-22 fleet.

What is the historical spending trend for MV-22 Osprey sustainment and component repair?

Historical spending on MV-22 Osprey sustainment and component repair has been substantial, reflecting the complexity and operational tempo of this advanced aircraft. The program has seen significant investments over its lifecycle to ensure fleet readiness. While specific figures for processor repair alone are not readily available, overall sustainment costs, including maintenance, spare parts, and upgrades, represent a considerable portion of the aircraft's total ownership cost. Spending trends are influenced by factors such as flight hours, component reliability, technological upgrades, and the overall size of the operational fleet. The Department of Defense consistently allocates significant budgets towards maintaining its high-value assets like the MV-22, making sustainment contracts a recurring and essential expenditure.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Honeywell Safety Products USA, Inc.

Address: 1944 E SKY HARBOR CIR, PHOENIX, AZ, 85034

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

Financial Breakdown

Contract Ceiling: $10,126,615

Exercised Options: $10,126,615

Current Obligation: $10,126,615

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001921G0020

IDV Type: BOA

Timeline