NASA's $43.5M Space Shuttle Main Engine Testing contract awarded to Aerojet Rocketdyne without competition
Contract Overview
Contract Amount: $43,460,479 ($43.5M)
Contractor: Aerojet Rocketdyne of DE, Inc
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2007-04-01
End Date: 2011-09-30
Contract Duration: 1,643 days
Daily Burn Rate: $26.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: R&D
Official Description: SPACE SHUTTLE MAIN ENGINE (SSME) TESTING
Place of Performance
Location: STENNIS SPACE CENTER, HANCOCK County, MISSISSIPPI, 39529
Plain-Language Summary
National Aeronautics and Space Administration obligated $43.5 million to AEROJET ROCKETDYNE OF DE, INC for work described as: SPACE SHUTTLE MAIN ENGINE (SSME) TESTING Key points: 1. Contract focused on critical research and development for the Space Shuttle Main Engine. 2. Sole-source award raises questions about potential cost efficiencies and market alternatives. 3. Performance risk is moderate given the specialized nature of rocket engine testing. 4. The contract duration of over four years suggests a significant, long-term R&D effort. 5. This spending falls within the broader aerospace and defense R&D sector. 6. The absence of competition limits opportunities for broader industry engagement.
Value Assessment
Rating: fair
Benchmarking the value of this specific R&D contract is challenging due to its specialized nature and sole-source award. Without competitive bids, it's difficult to definitively assess if the $43.5 million represents optimal value for money. However, the Cost Plus Award Fee (CPA F) structure suggests incentives for performance, which can help manage costs. The contract's duration and the critical nature of the SSME testing imply a significant investment, but a lack of comparable sole-source R&D contracts makes direct price comparison difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Aerojet Rocketdyne, was considered. This approach is typically justified when a unique capability or proprietary technology is required, or in cases of urgent need where competition is not feasible. The lack of competition means there was no opportunity for other qualified firms to bid, potentially limiting price discovery and the government's ability to secure the most cost-effective solution through market forces.
Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. Without competing bids, there's less assurance that the negotiated price reflects the lowest possible cost for the required services.
Public Impact
The primary beneficiary is NASA, ensuring continued research and development for the Space Shuttle Main Engine. Services delivered include critical testing and analysis essential for the Space Shuttle program's operational integrity. The geographic impact is primarily centered around facilities capable of conducting such specialized engine testing, likely in Mississippi where the contractor is located. Workforce implications include highly skilled engineers and technicians specializing in aerospace propulsion systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competitive pricing and potential innovation from other firms.
- Cost Plus Award Fee contracts can sometimes lead to higher costs if award criteria are not tightly managed.
- The specialized nature of the work may create vendor lock-in for future related R&D.
Positive Signals
- Focus on critical R&D for a vital national asset (Space Shuttle).
- Award fee structure provides some incentive for contractor performance.
- Aerojet Rocketdyne is a known entity with established expertise in rocket propulsion.
Sector Analysis
This contract falls within the Research and Development (R&D) sector, specifically focusing on aerospace engineering and propulsion systems. The market for specialized rocket engine testing is highly concentrated, with a few key players possessing the necessary infrastructure and expertise. NASA's spending in this area is crucial for maintaining technological superiority in space exploration and defense. Comparable spending benchmarks are difficult to establish due to the unique nature of the SSME and the sole-source award.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Given the specialized and high-value nature of rocket engine testing, it is unlikely that small businesses would be primary contractors for such a project. Subcontracting opportunities for small businesses may exist, but would depend on Aerojet Rocketdyne's specific sourcing strategies.
Oversight & Accountability
Oversight for this contract would primarily fall under NASA's contracting officer and program management. The Cost Plus Award Fee structure implies performance metrics and review processes to determine award fees. Transparency might be limited due to the sole-source nature and the proprietary aspects of R&D. Inspector General jurisdiction would apply to allegations of fraud, waste, or abuse.
Related Government Programs
- Space Shuttle Program
- Rocket Propulsion Research
- Aerospace Engineering Services
- NASA Research and Development Contracts
Risk Flags
- Sole-source award
- Lack of competition
- Cost Plus Award Fee structure
Tags
nasa, space-shuttle, rocket-engine, research-and-development, aerojet-rocketdyne, sole-source, cost-plus-award-fee, mississippi, aerospace, delivery-order
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $43.5 million to AEROJET ROCKETDYNE OF DE, INC. SPACE SHUTTLE MAIN ENGINE (SSME) TESTING
Who is the contractor on this award?
The obligated recipient is AEROJET ROCKETDYNE OF DE, INC.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $43.5 million.
What is the period of performance?
Start: 2007-04-01. End: 2011-09-30.
What is Aerojet Rocketdyne's track record with NASA, particularly on similar R&D contracts?
Aerojet Rocketdyne has a long-standing history as a major contractor for NASA and the Department of Defense, particularly in the area of rocket propulsion systems. They have been involved in numerous critical programs, including the Space Shuttle Main Engines (SSME) themselves, as well as other launch vehicle and spacecraft propulsion systems. Their track record generally indicates significant technical capability and experience in complex aerospace R&D. However, like many large defense contractors, they have also faced scrutiny over contract costs and performance on various programs throughout their history. Specific details on past performance metrics for similar R&D contracts would require deeper analysis of NASA's contract databases and performance reviews.
How does the $43.5 million cost compare to similar R&D efforts for rocket engines?
Directly comparing the $43.5 million cost of this specific SSME testing contract to 'similar' R&D efforts is challenging due to several factors. Firstly, the contract was sole-source, meaning competitive pricing benchmarks are absent. Secondly, the Space Shuttle Main Engine was a unique and highly complex piece of technology, making direct comparisons to other engine R&D difficult. Thirdly, the contract spanned over four years (2007-2011), and the nature of R&D involves inherent uncertainties that affect cost. While $43.5 million over four years for specialized engine testing is substantial, without detailed breakdowns of the work performed, labor hours, materials, and overhead, and without comparable competitive bids for similar unique engine development or testing, it's difficult to definitively state if it represents high or low value. The Cost Plus Award Fee structure suggests NASA aimed to incentivize performance within this budget.
What are the primary risks associated with this sole-source R&D contract?
The primary risks associated with this sole-source R&D contract include: 1) Cost Overruns: Without competitive pressure, there's a risk that costs could escalate beyond initial estimates, especially in complex R&D where unforeseen technical challenges can arise. The Cost Plus Award Fee (CPA F) structure attempts to mitigate this by incentivizing performance, but the base cost is still subject to negotiation. 2) Suboptimal Technical Solutions: A sole-source award might mean that alternative, potentially more innovative or cost-effective, technical approaches from other firms were not explored. 3) Limited Contractor Accountability: While performance is monitored, the lack of competition can sometimes reduce the urgency for a contractor to be exceptionally efficient or proactive compared to a competitive environment. 4) Vendor Lock-in: NASA might become reliant on Aerojet Rocketdyne for specific expertise related to the SSME, potentially limiting future options or increasing costs for follow-on work.
How effective was the Cost Plus Award Fee (CPA F) structure in managing this contract?
The effectiveness of the Cost Plus Award Fee (CPA F) structure for this contract depends on the specific award criteria established by NASA and how rigorously they were applied and monitored. CPA F contracts aim to incentivize contractor performance by allowing the contractor to earn a fee based on achieving certain performance objectives, in addition to recovering costs. For R&D contracts like this one, the objectives might relate to technical milestones, schedule adherence, or cost control. If NASA clearly defined measurable performance standards and diligently evaluated Aerojet Rocketdyne's performance against them, the CPA F structure could have been effective in driving desired outcomes and ensuring value. However, if the award criteria were vague or the oversight was lax, the 'award' portion of the fee might not have been fully earned, or conversely, could have been awarded without sufficient justification, leading to higher overall costs than anticipated.
What is the historical spending trend for Space Shuttle Main Engine testing or similar R&D by NASA?
Historical spending trends for Space Shuttle Main Engine (SSME) testing and similar large-scale aerospace R&D by NASA are characterized by significant, long-term investments. The SSME program itself, from development through its operational life, represented billions of dollars in spending over decades. Contracts for testing, maintenance, and upgrades, like the one awarded to Aerojet Rocketdyne, were essential components of this overall expenditure. Spending in this area is typically project-driven and subject to the priorities and budget allocations of NASA's exploration and science missions. While specific figures for SSME testing contracts fluctuate based on program phases and needs, the overall trend indicates substantial and continuous funding required for such critical, high-technology aerospace R&D endeavors. This particular $43.5 million contract fits within that pattern of significant, specialized R&D investment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences
Product/Service Code: QUALITY CONTROL, TEST, INSPECTION › EQUIPMENT AND MATERIALS TESTING
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Aerojet Rocketdyne Holdings, Inc. (UEI: 001316330)
Address: 6633 CANOGA AVE, CANOGA PARK, CA, 91303
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $44,064,321
Exercised Options: $44,064,321
Current Obligation: $43,460,479
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: NNS07AA20C
IDV Type: IDC
Timeline
Start Date: 2007-04-01
Current End Date: 2011-09-30
Potential End Date: 2011-09-30 00:00:00
Last Modified: 2021-09-14
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