Army Spends $40.8M on Two Beechcraft Aircraft, Awarded Sole-Source

Contract Overview

Contract Amount: $40,797,882 ($40.8M)

Contractor: Beechcraft Corporation

Awarding Agency: Department of Defense

Start Date: 2008-12-19

End Date: 2012-03-30

Contract Duration: 1,197 days

Daily Burn Rate: $34.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TO PROCURE 2 EACH HAWKER BEECHCRAFT 350 AIRCRAFT

Place of Performance

Location: WICHITA, SEDGWICK County, KANSAS, 67206

State: Kansas Government Spending

Plain-Language Summary

Department of Defense obligated $40.8 million to BEECHCRAFT CORPORATION for work described as: TO PROCURE 2 EACH HAWKER BEECHCRAFT 350 AIRCRAFT Key points: 1. High cost for two aircraft suggests potential for overpayment. 2. Sole-source award limits competitive pricing and transparency. 3. Aircraft manufacturing sector is complex, requiring specialized expertise. 4. Long contract duration may not reflect current market needs.

Value Assessment

Rating: questionable

The $40.8 million price tag for two aircraft is substantial. Without competitive bids, it's difficult to assess if this represents fair market value compared to similar aircraft procurements.

Cost Per Unit: $20,398,941

Competition Analysis

Competition Level: sole-source

The contract was awarded sole-source to Beechcraft Corporation, indicating a lack of competition. This method bypasses the typical price discovery process found in competitive bidding, potentially leading to higher costs for taxpayers.

Taxpayer Impact: The absence of competition likely resulted in a higher price than if multiple vendors had vied for the contract, impacting taxpayer funds.

Public Impact

Taxpayers funded a significant expenditure for specialized military aircraft. The decision to not compete the contract raises questions about procurement efficiency. The long duration of the contract (nearly 4 years) means taxpayers are committed to this specific vendor for an extended period.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
High per-unit cost
Lack of competition
Long contract duration

Positive Signals

Specific aircraft type procured
Firm fixed price contract

Sector Analysis

The Army's procurement of specialized aircraft falls within the broader aerospace and defense sector. Spending benchmarks for similar military aircraft can vary widely based on customization and capabilities, but $20.4 million per unit warrants scrutiny.

Small Business Impact

This contract was awarded to Beechcraft Corporation, a large manufacturer, and there is no indication that small businesses were involved in this specific procurement.

Oversight & Accountability

The sole-source nature of this award suggests limited oversight on price negotiation. Further review would be needed to confirm if justification for sole-source was robust and if any post-award oversight was conducted.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award lacks transparency and competitive pricing.
High per-unit cost raises concerns about value for money.
Long contract duration may not reflect current needs or market conditions.
Absence of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $40.8 million to BEECHCRAFT CORPORATION. TO PROCURE 2 EACH HAWKER BEECHCRAFT 350 AIRCRAFT

Who is the contractor on this award?

The obligated recipient is BEECHCRAFT CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $40.8 million.

What is the period of performance?

Start: 2008-12-19. End: 2012-03-30.

What was the justification for awarding this contract sole-source, and did it align with federal procurement regulations?

Federal regulations permit sole-source contracts under specific circumstances, such as when only one responsible source can provide the required supplies or services. The justification would need to detail why competition was not feasible or advantageous, potentially due to unique capabilities, proprietary technology, or urgent needs. Without access to the specific justification documentation, it's impossible to confirm its validity and adherence to procurement laws.

How does the per-unit cost of these Beechcraft 350 aircraft compare to market rates for similar civilian or military aircraft at the time of award?

Benchmarking the per-unit cost of $20.4 million requires detailed comparison with similar aircraft models procured around 2008-2012. Factors like avionics, modifications, and support packages significantly influence price. Civilian versions of the King Air 350 were priced lower, but military configurations often include specialized equipment. A thorough analysis would involve comparing specifications and contract terms of comparable government or commercial sales.

What is the operational effectiveness and necessity of these specific aircraft for the Department of the Army's mission?

The operational effectiveness and necessity depend entirely on the Army's specific mission requirements. The Beechcraft 350 is a versatile twin-engine turboprop known for its utility, often used for transport, surveillance, or training. If these aircraft were procured for a critical, unique role that only this platform could fulfill, and if competition was genuinely impossible, the expenditure might be justified. However, the lack of competition still raises concerns about value for money.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W58RGZ08R0281

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Hawker Beechcraft, Inc. (UEI: 800097615)

Address: 9709 EAST CENTRAL AVE, WICHITA, KS, 04

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: $40,797,882

Exercised Options: $40,797,882

Current Obligation: $40,797,882

Contract Characteristics

Cost or Pricing Data: NO

Timeline