Elbit America awarded $53.2M for aircraft parts, with limited competition and a 1000-day duration
Contract Overview
Contract Amount: $53,229,998 ($53.2M)
Contractor: Elbitamerica, Inc.
Awarding Agency: Department of Defense
Start Date: 2018-09-25
End Date: 2021-06-21
Contract Duration: 1,000 days
Daily Burn Rate: $53.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DISPLAY UNIT,AIRCRA
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76179
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $53.2 million to ELBITAMERICA, INC. for work described as: DISPLAY UNIT,AIRCRA Key points: 1. The contract's value of $53.2 million over approximately 2.7 years suggests a significant investment in aircraft parts. 2. The 'NOT COMPETED' award type raises questions about potential price efficiencies and the availability of alternative suppliers. 3. The firm fixed-price contract type provides cost certainty for the government but shifts risk to the contractor. 4. The duration of 1000 days indicates a long-term need for these aircraft parts, potentially for sustainment or a specific program. 5. The award to Elbit America, a known defense contractor, places this spending within the established defense industrial base. 6. The absence of small business set-aside flags suggests this contract was not specifically targeted for small business participation.
Value Assessment
Rating: fair
The total award of $53.2 million for aircraft parts over 1000 days needs further benchmarking against similar contracts for specific aircraft components. Without a clear understanding of the specific parts and their quantities, a precise per-unit cost comparison is difficult. However, the 'NOT COMPETED' nature of the award suggests that a thorough price analysis may not have been conducted against a competitive market, potentially leading to a less favorable price than could be achieved through open competition. The benchmark of $53.23 million (br) is noted but lacks context without knowing the scope of work.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded as 'NOT COMPETED,' indicating that a sole-source or limited competition approach was used. This means that the Defense Logistics Agency did not solicit offers from multiple potential suppliers. The reasons for this approach are not detailed in the provided data but could stem from factors such as the unique capabilities of the contractor, urgent requirements, or the unavailability of other sources. The lack of broad competition limits the government's ability to leverage market forces to drive down prices and ensure the best value.
Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying a premium for goods or services, as the competitive pressure that typically leads to cost savings is absent. This can result in less efficient use of public funds.
Public Impact
The primary beneficiaries are likely military aviation units requiring specific aircraft parts for operational readiness and maintenance. The services delivered include the provision of essential aircraft components, ensuring the continued functionality of defense assets. The geographic impact is primarily within the United States, given the contractor's location in Texas (st: TX, sn: TEXAS), supporting domestic defense capabilities. Workforce implications include the potential for job creation or sustainment within Elbit America's manufacturing and logistics operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition may lead to higher costs for taxpayers.
- Limited transparency into the justification for a sole-source award.
- Potential for missed opportunities to engage small businesses in the supply chain.
Positive Signals
- Firm fixed-price contract provides cost certainty for the government.
- Award to an established defense contractor suggests reliability in delivery.
- Long contract duration indicates a sustained need, potentially supporting long-term program stability.
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts. The market for such components is characterized by high technical requirements, stringent quality control, and often long production cycles. Spending in this area is critical for maintaining military readiness. Comparable spending benchmarks would typically involve analyzing other contracts for similar aircraft parts or sustainment services awarded by the Department of Defense or other government agencies.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the procurement process did not prioritize small business participation. Consequently, there are no direct subcontracting implications for small businesses stemming from this specific award. The absence of a small business set-aside means that larger, established contractors like Elbit America were the primary focus, potentially limiting opportunities for smaller firms to enter the defense supply chain for these specific parts.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Logistics Agency (DLA) and potentially the Department of Defense's Inspector General. Accountability measures are inherent in the firm fixed-price contract, which holds the contractor responsible for delivering the specified parts within the agreed-upon price. Transparency is limited by the sole-source nature of the award; however, contract award data is generally made public through systems like SAM.gov.
Related Government Programs
- Aircraft Parts Manufacturing
- Defense Logistics Agency Procurement
- Military Aircraft Sustainment
- Sole-Source Defense Contracts
Risk Flags
- Sole-source award lacks competitive justification.
- Potential for inflated pricing due to lack of competition.
- Limited transparency regarding specific parts and justification for non-competition.
Tags
defense, department-of-defense, defense-logistics-agency, aircraft-parts, manufacturing, not-competed, sole-source, firm-fixed-price, large-contract, texas, elbit-america
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $53.2 million to ELBITAMERICA, INC.. DISPLAY UNIT,AIRCRA
Who is the contractor on this award?
The obligated recipient is ELBITAMERICA, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $53.2 million.
What is the period of performance?
Start: 2018-09-25. End: 2021-06-21.
What specific aircraft parts are being procured under this contract, and what is their intended use?
The provided data indicates the contract is for 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' (na: 336413, nd: Other Aircraft Parts and Auxiliary Equipment Manufacturing). However, the specific types of parts are not detailed. These could range from engine components, structural elements, avionics parts, or auxiliary equipment necessary for the operation and maintenance of various military aircraft platforms. The intended use is likely for sustainment, repair, and operational readiness of the U.S. military's aviation assets, ensuring that aircraft remain functional and mission-capable.
What was the justification for awarding this contract on a sole-source basis instead of through full and open competition?
The data explicitly states the contract was 'NOT COMPETED' (ct: NOT COMPETED), indicating a sole-source or limited competition award. The specific justification for this approach is not provided in the data. Common reasons for sole-source awards in defense contracting include situations where only one responsible source can provide the required supplies or services, urgent and compelling needs that preclude competition, or when a specific technology or capability is uniquely held by a single contractor. Without further documentation from the agency, the precise rationale remains unknown, but it implies that competitive market dynamics were deemed inapplicable or impractical for this procurement.
How does the awarded amount of $53.2 million compare to historical spending on similar aircraft parts by the Defense Logistics Agency?
The provided data includes a benchmark value (br: 53230), which appears to be $53.23 million, very close to the total award amount. However, this benchmark lacks context regarding what it represents (e.g., a previous contract value, an estimated cost). To accurately compare this $53.2 million award to historical spending, one would need to analyze past DLA contracts for similar 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' over comparable timeframes. Factors such as inflation, technological advancements, and changes in military fleet size and composition would need to be considered for a meaningful comparison. Without access to a broader historical spending database for this specific NAICS code or product category, a definitive comparison is challenging.
What are the potential risks associated with a firm fixed-price contract awarded on a sole-source basis?
A firm fixed-price (FFP) contract generally aims to provide cost certainty for the government. However, when awarded on a sole-source basis, the risks can be amplified. The primary risk is that the government may pay a higher price than necessary because there was no competitive pressure to drive down costs. The contractor, knowing they are the only source, may have less incentive to be highly efficient or to offer the most competitive pricing. While the FFP structure shifts performance risk to the contractor (they bear cost overruns), the lack of competition can lead to a suboptimal price outcome for the government, representing a value-for-money risk.
What is Elbit America's track record with the Defense Logistics Agency and similar sole-source contracts?
Elbit America, Inc. is a known defense contractor, and its track record with the Defense Logistics Agency (DLA) and other government entities would typically involve numerous awards across various categories. Information on their performance, including past delivery performance, quality control, and adherence to contract terms, would be available through contract databases and performance assessment systems (e.g., Contractor Performance Assessment Reporting System - CPARS). Without specific data on Elbit America's history with DLA, particularly regarding sole-source awards for aircraft parts, it's difficult to assess their specific track record for this type of contract. However, as a significant player in the defense sector, they are expected to have established processes for fulfilling such requirements.
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
Solicitation ID: SPRPA118RX440
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Elbit Systems Ltd
Address: 4700 MARINE CREEK PKWY, FORT WORTH, TX, 76179
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $53,229,998
Exercised Options: $53,229,998
Current Obligation: $53,229,998
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: SPRPA113G004X
IDV Type: BOA
Timeline
Start Date: 2018-09-25
Current End Date: 2021-06-21
Potential End Date: 2022-12-30 00:00:00
Last Modified: 2022-12-05
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