Vertex Aerospace LLC awarded $157.5M for Naval Air Systems Command aircraft maintenance, with a 1281-day duration

Contract Overview

Contract Amount: $157,517,221 ($157.5M)

Contractor: Vertex Aerospace LLC

Awarding Agency: Department of Defense

Start Date: 2023-03-29

End Date: 2026-09-30

Contract Duration: 1,281 days

Daily Burn Rate: $123.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: NAVAL TEST WING PACIFIC AIRCRAFT MAINTENANCE (VX-30 AND VX-31)

Place of Performance

Location: RIDGECREST, KERN County, CALIFORNIA, 93555

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $157.5 million to VERTEX AEROSPACE LLC for work described as: NAVAL TEST WING PACIFIC AIRCRAFT MAINTENANCE (VX-30 AND VX-31) Key points: 1. Contract value of $157.5M over approximately 3.5 years suggests a significant investment in maintaining critical naval aviation assets. 2. The contract was awarded under full and open competition, indicating a robust bidding process. 3. The cost-plus-fixed-fee (CPFF) contract type introduces potential for cost overruns if not managed diligently. 4. The primary performance location is California, suggesting a concentration of naval aviation support activities in the region. 5. The contract's duration of 1281 days allows for sustained support but requires ongoing performance monitoring. 6. The North American Industry Classification System (NAICS) code 488190 points to specialized aviation support services.

Value Assessment

Rating: good

The contract value of $157.5M for aircraft maintenance over 1281 days averages approximately $122,964 per day. Benchmarking this against similar large-scale aircraft maintenance contracts is challenging without more specific service details. However, the fixed fee component within the CPFF structure aims to control overall costs, suggesting an effort to achieve value for money. The Naval Air Systems Command's extensive experience in contracting for such services implies a degree of established cost awareness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The presence of two bids indicates a competitive environment, though the exact number of potential bidders is unknown. A competitive process generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down prices through market forces, ensuring the government receives competitive offers and avoids paying inflated rates.

Public Impact

Naval Test Wing Pacific personnel and operations benefit from the sustained availability of well-maintained aircraft. The contract ensures the operational readiness of specialized aircraft used for testing and evaluation. The primary geographic impact is in California, supporting naval aviation infrastructure in the region. The contract supports a workforce skilled in aircraft maintenance and specialized aviation support services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize contractors to increase costs to maximize their fee, requiring robust oversight.
The long duration of the contract necessitates continuous performance monitoring to ensure sustained quality and efficiency.
Reliance on a single contractor for critical aircraft maintenance could pose a risk if performance degrades or the contractor faces financial instability.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
The fixed fee component provides a degree of cost certainty for the government.
The contract supports a critical function for naval aviation readiness and testing capabilities.

Sector Analysis

The aerospace maintenance and repair industry is a significant sector within the broader aerospace and defense market. This contract falls under support activities for air transportation, specifically focusing on military aircraft. The market for military aircraft maintenance is substantial, driven by the need to maintain high operational readiness for defense forces. Comparable spending benchmarks would typically be found within Department of Defense budgets for aviation sustainment and readiness programs.

Small Business Impact

There is no indication of a small business set-aside for this contract, and the prime contractor, Vertex Aerospace LLC, is a significant entity. However, large prime contractors often utilize small businesses for subcontracting opportunities. The extent of small business participation will depend on Vertex Aerospace's subcontracting plan and the specific requirements of the maintenance tasks.

Oversight & Accountability

Oversight for this contract will likely be managed by the Naval Air Systems Command (NAVAIR) through contracting officers and technical representatives. Performance metrics and deliverables will be defined in the contract's statement of work. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Air Systems Command (NAVAIR) Operations
Fleet Readiness Centers
Aircraft Depot Maintenance Programs
Air Force Sustainment Center Contracts
Army Aviation and Missile Command Support Contracts

Risk Flags

Cost-plus-fixed-fee contract type requires diligent oversight to manage potential cost escalations.
Long contract duration necessitates sustained performance monitoring.
Potential for contractor performance issues over the contract lifecycle.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $157.5 million to VERTEX AEROSPACE LLC. NAVAL TEST WING PACIFIC AIRCRAFT MAINTENANCE (VX-30 AND VX-31)

Who is the contractor on this award?

The obligated recipient is VERTEX AEROSPACE LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $157.5 million.

What is the period of performance?

Start: 2023-03-29. End: 2026-09-30.

What is the historical spending pattern for aircraft maintenance services by Naval Test Wing Pacific or similar entities?

Analyzing historical spending for aircraft maintenance by Naval Test Wing Pacific or comparable naval aviation commands requires access to detailed procurement data over several fiscal years. Generally, such spending fluctuates based on fleet readiness requirements, aircraft modernization programs, and the lifecycle of the aircraft being supported. Contracts for maintenance can range from short-term, specialized repairs to long-term sustainment agreements. The value of this $157.5M contract suggests a significant, multi-year commitment, potentially reflecting a shift towards consolidated support or a response to increased operational tempo or aging aircraft fleets. Without specific historical data for VX-30 and VX-31, it's difficult to pinpoint exact trends, but sustained investment in aircraft maintenance is a consistent feature of naval aviation operations.

How does the cost-plus-fixed-fee (CPFF) structure compare to other contract types for aircraft maintenance, and what are the associated risks?

The Cost-Plus-Fixed-Fee (CPFF) contract type is common for complex services where the scope of work can be difficult to define precisely upfront, such as research and development or specialized maintenance. In a CPFF contract, the contractor is reimbursed for allowable costs plus a fixed fee, representing profit. This structure aims to provide flexibility while offering the government some cost predictability through the fixed fee. However, a key risk is that the contractor may have less incentive to control costs, as their profit is fixed regardless of the total cost incurred. This necessitates robust government oversight to monitor costs and ensure efficiency. Other contract types, like Firm-Fixed-Price (FFP), offer greater cost certainty but are less suitable for undefined scopes. Incentive-fee contracts can align contractor and government interests more closely but add complexity.

What is Vertex Aerospace LLC's track record with Department of Defense contracts, particularly in aircraft maintenance?

Vertex Aerospace LLC has a significant track record with the Department of Defense, often securing contracts related to aircraft maintenance, modification, and sustainment. Publicly available data indicates they have been awarded numerous contracts across various branches, including the Air Force and Navy. Their experience often involves supporting a range of aircraft types, from fixed-wing to rotary-wing platforms. Performance reviews and past contract awards suggest a capacity to handle large-scale sustainment operations. However, as with any large contractor, specific performance details, including any past issues or disputes on other contracts, would require deeper investigation into contract performance reports and any associated corrective actions or litigation.

What are the potential implications of this contract on the broader aerospace maintenance market and small business participation?

This $157.5M contract awarded to Vertex Aerospace LLC has several implications for the broader aerospace maintenance market. Firstly, it signifies continued government investment in maintaining its aviation fleet, supporting jobs and infrastructure within the defense aerospace sector. For Vertex Aerospace, it represents a substantial revenue stream and reinforces their position as a key player in military aircraft sustainment. Regarding small business participation, while this prime contract is not set aside for small businesses, large prime contractors like Vertex are often required or incentivized to subcontract portions of the work to small businesses. This can create opportunities for specialized small businesses in areas like component repair, logistics support, or specific technical services. The extent of this participation will depend on Vertex's subcontracting plan and the specific needs of the contract.

How does the geographic concentration of this contract in California align with naval aviation infrastructure and support capabilities?

The concentration of this aircraft maintenance contract in California aligns with the significant naval aviation presence on the West Coast. California hosts numerous naval air stations and facilities, including those integral to testing and evaluation operations managed by Naval Test Wing Pacific. Placing maintenance support in proximity to these operational bases reduces transit times for aircraft, facilitates quicker turnaround for repairs, and allows for closer collaboration between flight crews, maintenance personnel, and test engineers. This geographic alignment optimizes logistical support and ensures that aircraft critical for testing and evaluation are readily available, thereby supporting the Navy's overall mission readiness and technological development efforts in the region.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 555 INDUSTRIAL DR S, MADISON, MS, 39110

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

Financial Breakdown

Contract Ceiling: $408,238,926

Exercised Options: $184,414,967

Current Obligation: $157,517,221

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $800,974

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Parent Contract

Parent Award PIID: N6134019D1010

IDV Type: IDC

Timeline