General Electric Company awarded $163M contract for PBL Service Support by the Defense Logistics Agency
Contract Overview
Contract Amount: $163,036,149 ($163.0M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2018-12-11
End Date: 2019-11-30
Contract Duration: 354 days
Daily Burn Rate: $460.6K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 8506114078!PBL SERVICE SUPPORT
Place of Performance
Location: CINCINNATI, HAMILTON County, OHIO, 45215
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $163.0 million to GENERAL ELECTRIC COMPANY for work described as: 8506114078!PBL SERVICE SUPPORT Key points: 1. Contract awarded on a firm-fixed-price basis, indicating clear cost expectations. 2. The contract was not competed, raising questions about potential price efficiencies. 3. Performance period of 354 days suggests a focused, short-term support requirement. 4. The award falls under Other Aircraft Parts and Auxiliary Equipment Manufacturing. 5. Geographic location of performance is Ohio. 6. No small business set-aside was applied to this contract.
Value Assessment
Rating: questionable
The contract value of $163 million for a 354-day period for PBL Service Support appears substantial. Without comparable contract data or detailed cost breakdowns, it is difficult to benchmark the value for money. The firm-fixed-price structure provides cost certainty but does not inherently guarantee optimal pricing, especially in a non-competed scenario. Further analysis would be needed to assess if this price reflects market rates for similar support services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This limits the opportunity for price discovery through market competition and may result in higher costs for the government compared to a competed procurement. The rationale for the sole-source award is not provided in the data, which is a key factor in assessing its justification.
Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as the government does not benefit from competitive bidding to drive down prices.
Public Impact
The primary beneficiaries are likely the Department of Defense, specifically units relying on the supported aircraft parts and auxiliary equipment. The services delivered are critical for maintaining the operational readiness of aircraft. The geographic impact is concentrated in Ohio, where the performance is scheduled. Workforce implications would involve personnel at General Electric Company dedicated to fulfilling this service support contract.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to inflated pricing.
- Sole-source award raises concerns about transparency and justification.
- Limited duration might indicate a stop-gap measure rather than a long-term strategic solution.
Positive Signals
- Firm-fixed-price contract provides cost certainty for the government.
- Award to a known entity (General Electric Company) may imply established relationship and expertise.
- Contract supports critical defense logistics and aircraft readiness.
Sector Analysis
This contract falls within the aerospace and defense sector, specifically supporting aircraft parts and auxiliary equipment. The market for such services is often characterized by specialized technical expertise and long-standing relationships between manufacturers and government agencies. Benchmarking this spending would require comparison to similar Performance-Based Logistics (PBL) support contracts for defense systems, which can vary significantly based on the complexity and criticality of the equipment.
Small Business Impact
The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This means that the primary awardee, General Electric Company, will likely perform the majority of the work. The absence of small business considerations in this specific award may limit opportunities for smaller firms to participate in this particular defense support contract.
Oversight & Accountability
Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA) and the Defense Logistics Agency's internal oversight mechanisms. Accountability is established through the firm-fixed-price terms, requiring delivery of specified services. Transparency is limited due to the sole-source nature of the award, with further details on oversight and accountability dependent on internal agency reporting and potential Inspector General reviews.
Related Government Programs
- Performance-Based Logistics (PBL) Contracts
- Aircraft Parts and Auxiliary Equipment Support
- Defense Logistics Agency Procurement
- General Electric Company Defense Contracts
Risk Flags
- Sole-source award
- Lack of competition
- Potential for inflated pricing
Tags
defense, department-of-defense, defense-logistics-agency, general-electric-company, pbl-service-support, firm-fixed-price, sole-source, aircraft-parts, ohio, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $163.0 million to GENERAL ELECTRIC COMPANY. 8506114078!PBL SERVICE SUPPORT
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $163.0 million.
What is the period of performance?
Start: 2018-12-11. End: 2019-11-30.
What is the historical spending pattern for PBL Service Support with General Electric Company by the Defense Logistics Agency?
Analyzing historical spending patterns for Performance-Based Logistics (PBL) Service Support with General Electric Company by the Defense Logistics Agency requires access to historical contract databases. Without specific historical data, it's impossible to provide precise figures. However, PBL contracts are typically long-term agreements aimed at improving weapon system readiness and reducing costs through contractor-managed support. If this is a recurring need, one would expect to see previous awards for similar services, potentially with varying contract values and durations based on evolving requirements and market conditions. A trend analysis would reveal if spending has increased, decreased, or remained stable over time, and whether the contract type or competition level has changed.
How does the awarded price of $163 million compare to market rates for similar aircraft parts and auxiliary equipment support services?
Benchmarking the $163 million award against market rates for similar aircraft parts and auxiliary equipment support services is challenging without detailed specifications of the services provided and the specific aircraft systems involved. Market rates are influenced by factors such as the complexity of the equipment, the required level of technical expertise, the duration of the support, and the competitive landscape. Given this contract was sole-sourced, direct comparison to competitively bid contracts is difficult. However, industry benchmarks for PBL contracts often focus on achieving specific performance metrics (e.g., availability, reliability) at a target cost. A comprehensive assessment would involve comparing the proposed cost against independent cost estimates or data from similar, competitively awarded PBL contracts for comparable defense systems.
What are the specific risks associated with a sole-source award for critical defense support services?
Sole-source awards for critical defense support services carry several inherent risks. Primarily, the lack of competition can lead to suboptimal pricing, meaning the government may pay more than necessary. This can also reduce the incentive for the contractor to innovate or improve efficiency, as there is no competitive pressure. Furthermore, sole-source awards can raise concerns about transparency and fairness in the procurement process. If the justification for the sole-source award is weak or based on outdated information, it could indicate a potential for vendor lock-in or a failure to explore more cost-effective alternatives. This can also limit the government's ability to leverage new technologies or solutions from a broader range of potential suppliers.
What is General Electric Company's track record with Performance-Based Logistics (PBL) contracts, particularly within the Department of Defense?
General Electric Company (GE) has a significant and established track record with Performance-Based Logistics (PBL) contracts, particularly within the Department of Defense. GE is a major defense contractor known for providing complex systems and support services across various platforms, including aviation and power generation. Their involvement in PBL often centers on ensuring the long-term readiness and sustainment of critical military assets, such as aircraft engines and related components. Historically, GE has engaged in numerous PBL agreements designed to improve system availability, reduce lifecycle costs, and enhance operational performance for the military. Evaluating their specific track record on this $163 million contract would involve reviewing past performance metrics, delivery success rates, and cost-effectiveness achieved on similar prior PBL agreements.
What are the potential implications of this contract on the overall readiness and operational capability of the supported aircraft?
This contract for PBL Service Support is directly linked to the readiness and operational capability of the supported aircraft. Performance-Based Logistics aims to ensure that necessary parts, maintenance, and support are available when needed, thereby maximizing aircraft availability and mission effectiveness. A successful execution of this contract by General Electric Company should translate into fewer aircraft downtime incidents, quicker repair times, and sustained operational performance. Conversely, any shortcomings in service delivery, such as delays in parts provisioning or inadequate maintenance support, could negatively impact aircraft readiness, potentially leading to mission delays or cancellations. The firm-fixed-price nature suggests a focus on meeting defined performance outcomes critical for maintaining operational capability.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 NEUMANN WAY, CINCINNATI, OH, 45215
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $163,036,149
Exercised Options: $163,036,149
Current Obligation: $163,036,149
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPE4AX15D9412
IDV Type: IDC
Timeline
Start Date: 2018-12-11
Current End Date: 2019-11-30
Potential End Date: 2019-11-30 00:00:00
Last Modified: 2019-09-10
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