DoD Awards $127M Firm Fixed Price Contract to Honeywell for T-55 Engine Logistics Support
Contract Overview
Contract Amount: $126,686,772 ($126.7M)
Contractor: Honeywell International Inc.
Awarding Agency: Department of Defense
Start Date: 2011-02-28
End Date: 2018-10-15
Contract Duration: 2,786 days
Daily Burn Rate: $45.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: TECH ENG&LOG SVCS AND MATERIAL FOR T-55 ENGINE FOLLOW-ON PARTNERSHIP CONTRACT
Place of Performance
Location: CORPUS CHRISTI, NUECES County, TEXAS, 78419
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $126.7 million to HONEYWELL INTERNATIONAL INC. for work described as: TECH ENG&LOG SVCS AND MATERIAL FOR T-55 ENGINE FOLLOW-ON PARTNERSHIP CONTRACT Key points: 1. Significant contract value of $127M for engine logistics services. 2. Sole-source award to Honeywell International Inc. raises competition concerns. 3. Long contract duration (2011-2018) suggests potential for price creep. 4. Services fall under Process, Physical Distribution, and Logistics Consulting.
Value Assessment
Rating: questionable
The contract's firm fixed price structure is positive, but the lack of competition and long duration make a definitive value assessment difficult without further data. The awarded amount of $126.7M over nearly 8 years suggests a substantial investment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Honeywell International Inc. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive environment.
Taxpayer Impact: The lack of competition for a contract of this magnitude likely results in a higher cost to taxpayers than if multiple vendors had vied for the work.
Public Impact
Ensures continued operational readiness for T-55 engines, critical for Army aviation. Potential for increased costs due to sole-source nature impacts defense budget. Long-term reliance on a single provider may stifle innovation in logistics support.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Firm fixed price contract type
Sector Analysis
This contract falls within the professional, scientific, and technical services sector, specifically logistics consulting. Defense logistics contracts can be substantial, and benchmarks vary widely based on the specific equipment and services provided.
Small Business Impact
The contract was awarded to Honeywell International Inc., a large business. There is no indication that small businesses were involved as subcontractors or partners in this specific award.
Oversight & Accountability
The sole-source nature of this contract warrants scrutiny to ensure fair pricing and efficient use of taxpayer funds. Further review of the justification for not competing the award would be beneficial.
Related Government Programs
- Process, Physical Distribution, and Logistics Consulting Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award lacks competition.
- Long contract duration increases risk.
- Potential for higher costs to taxpayers.
- Limited transparency on justification for sole-sourcing.
Tags
process-physical-distribution-and-logist, department-of-defense, tx, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $126.7 million to HONEYWELL INTERNATIONAL INC.. TECH ENG&LOG SVCS AND MATERIAL FOR T-55 ENGINE FOLLOW-ON PARTNERSHIP CONTRACT
Who is the contractor on this award?
The obligated recipient is HONEYWELL INTERNATIONAL INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $126.7 million.
What is the period of performance?
Start: 2011-02-28. End: 2018-10-15.
What was the justification for awarding this contract on a sole-source basis?
The provided data does not include the specific justification for the sole-source award. Typically, such justifications might include unique capabilities, proprietary technology, or urgent requirements where only one vendor can meet the need. Without this information, it's difficult to assess if the lack of competition was truly warranted.
How does the per-unit cost of T-55 engine logistics support compare to industry benchmarks for similar services?
A direct per-unit cost benchmark is not available from the provided data. The contract is for broad logistics services over a long period, not easily broken down into comparable units. A detailed cost analysis would be required, comparing specific service elements to industry standards for engine maintenance and support.
What is the potential risk of cost overruns or performance issues given the long duration and sole-source nature?
The long duration (2011-2018) and sole-source award present a moderate to high risk of cost overruns and potential performance complacency. Without competitive pressure, Honeywell may have less incentive to control costs or innovate. The firm fixed price helps mitigate some risk, but the lack of competition is a significant concern.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Process, Physical Distribution, and Logistics Consulting Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W58RGZ09R0699
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Honeywell International Inc (UEI: 139691877)
Address: 1300 WEST WARNER ROAD, TEMPE, AZ, 85284
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: $246,178,955
Exercised Options: $126,686,772
Current Obligation: $126,686,772
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2011-02-28
Current End Date: 2018-10-15
Potential End Date: 2018-10-15 00:00:00
Last Modified: 2019-08-28
More Contracts from Honeywell International Inc.
- Federal Contract — $1.8B (Department of Defense)
- Tiger II Services and Hardware UCA — $1.2B (Department of Defense)
- Aircraft Engines/Engine Parts — $934.2M (Department of Defense)
- Non-Personal Services - Secondary Power Logistics Solution (spls) — $798.7M (Department of Defense)
- 200607!000110!5700!fa8626!asc/Lpk !FA862606C2065 !A!N! !N! ! !20060425!20070122!195908637!195908637!139691877!n!honeywell Intl !13350 US Highway 19 North !clearwater !fl!33764!12875!103!12!clearwater !pinellas !florida !+000000398530!n!n!000121531465!5895!miscellaneous Communication Equipment !A7 !electronics and Communication Equip !000 !NOT Discernable !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !c!n!j!1!001!n!1a!a!y!a! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! ! !0001! ! — $451.3M (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)