DoD's $173M F414 Depot Support Contract Awarded to General Electric Amidst Limited Competition
Contract Overview
Contract Amount: $172,959,624 ($173.0M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2023-01-01
End Date: 2023-08-31
Contract Duration: 242 days
Daily Burn Rate: $714.7K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: F414 DEPOT COMPONENT SUPPORT PERFORMANCE BASED LOGISTICS
Place of Performance
Location: LYNN, ESSEX County, MASSACHUSETTS, 01905
Plain-Language Summary
Department of Defense obligated $173.0 million to GENERAL ELECTRIC COMPANY for work described as: F414 DEPOT COMPONENT SUPPORT PERFORMANCE BASED LOGISTICS Key points: 1. The contract, valued at $172.96 million, focuses on performance-based logistics for F414 depot components. 2. General Electric Company is the sole awardee, indicating a lack of broader competition for this specialized support. 3. The contract's duration is 242 days, suggesting a focused, short-term support requirement. 4. The sector is dominated by Aircraft Engine and Engine Parts Manufacturing, highlighting specialized industrial capabilities.
Value Assessment
Rating: fair
The contract value of $172.96 million for 242 days of support appears substantial. Benchmarking against similar performance-based logistics contracts for complex aircraft components is necessary to fully assess value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, likely due to the specialized nature of F414 engine component support and General Electric's unique position as the original equipment manufacturer. This limits price discovery and potentially increases costs for the government.
Taxpayer Impact: The lack of competition may result in higher costs for taxpayers, as there was no opportunity for competitive bidding to drive down prices.
Public Impact
Ensures continued operational readiness of Navy aircraft reliant on F414 engines. Supports critical maintenance and repair services for a key defense asset. Potential for increased costs due to sole-source award impacts taxpayer funds. Highlights reliance on a single manufacturer for specialized engine component support.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price negotiation.
- Short contract duration may indicate a stop-gap measure or specialized need.
- Lack of small business participation noted.
Positive Signals
- Performance-based logistics aims for efficiency and readiness.
- Focus on critical aircraft engine components ensures operational capability.
Sector Analysis
This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector, a highly specialized area within defense industrial base. Spending in this sector is critical for maintaining advanced military platforms, and benchmarks often reflect high R&D and manufacturing costs.
Small Business Impact
The data indicates no specific allocation or consideration for small businesses in this sole-source award. This is common for highly specialized defense contracts where only a few large, established manufacturers possess the required capabilities.
Oversight & Accountability
The sole-source nature of this award warrants careful oversight to ensure fair pricing and performance standards are met. The Department of the Navy should monitor contract execution closely to mitigate risks associated with limited competition.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award limits competition.
- Potential for price escalation due to lack of competition.
- Reliance on a single supplier creates supply chain risk.
- No small business participation identified.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ma, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $173.0 million to GENERAL ELECTRIC COMPANY. F414 DEPOT COMPONENT SUPPORT PERFORMANCE BASED LOGISTICS
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $173.0 million.
What is the period of performance?
Start: 2023-01-01. End: 2023-08-31.
What is the justification for the sole-source award, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically stems from the unique capabilities or proprietary nature of the product or service. In this case, General Electric likely holds the intellectual property or specialized manufacturing knowledge for F414 engine components. To ensure fair pricing, the Department of the Navy should conduct a thorough price analysis, comparing proposed costs against historical data, independent cost estimates, and potentially other similar contracts, even if not directly competitive.
What are the long-term implications of relying on a single supplier for critical F414 engine components?
Long-term reliance on a single supplier can create significant strategic risks, including supply chain vulnerabilities, potential price escalation without competitive pressure, and reduced innovation. It also limits the government's leverage in negotiations. The Department of Defense should consider strategies to foster competition in the future, such as encouraging second-sourcing or investing in alternative technologies, to mitigate these risks.
How does this contract contribute to the overall readiness and cost-effectiveness of the F414 engine fleet?
This contract directly supports the operational readiness of aircraft equipped with F414 engines by ensuring the availability of necessary depot-level components and maintenance. Performance-based logistics aims to improve efficiency and reduce downtime, potentially leading to cost savings through optimized maintenance schedules and component lifespan. However, the effectiveness in terms of cost-effectiveness is contingent on the pricing negotiated under the sole-source arrangement.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1000 WESTERN AVE, LYNN, MA, 01905
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: $172,959,624
Exercised Options: $172,959,624
Current Obligation: $172,959,624
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: N0038321DZN01
IDV Type: IDC
Timeline
Start Date: 2023-01-01
Current End Date: 2023-08-31
Potential End Date: 2023-08-31 00:00:00
Last Modified: 2024-03-27
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