Army Awards $28.3M for Turbine Engine Refurbishment to General Electric, No Competition
Contract Overview
Contract Amount: $28,300,858 ($28.3M)
Contractor: General Electric Company
Awarding Agency: Department of Defense
Start Date: 2024-10-03
End Date: 2027-09-30
Contract Duration: 1,092 days
Daily Burn Rate: $25.9K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: REFURBISHMENT AND OVERHAUL OF TURBINE ENGINES FOR FOREIGN MILITARY SALES CUSTOMERS.
Place of Performance
Location: ARKANSAS CITY, COWLEY County, KANSAS, 67005
State: Kansas Government Spending
Plain-Language Summary
Department of Defense obligated $28.3 million to GENERAL ELECTRIC COMPANY for work described as: REFURBISHMENT AND OVERHAUL OF TURBINE ENGINES FOR FOREIGN MILITARY SALES CUSTOMERS. Key points: 1. Significant contract value for engine refurbishment services. 2. Sole-source award to General Electric raises competition concerns. 3. Long-term contract (3 years) for foreign military sales customers. 4. Focus on aircraft engine parts manufacturing sector.
Value Assessment
Rating: fair
The contract value of $28.3 million for turbine engine refurbishment is substantial. Benchmarking against similar contracts for engine overhaul services is difficult without more specific details on the scope of work and the specific engine types involved. The lack of competition makes a direct price comparison challenging.
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. This approach limits price discovery and potentially leads to higher costs for the government compared to a competitive process. The justification for sole-source is not provided.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying a premium for these refurbishment services, as there was no market pressure to drive down costs.
Public Impact
Ensures operational readiness of aircraft for allied nations through engine maintenance. Supports the defense industrial base by providing work for a major manufacturer. Potential for increased costs to taxpayers due to sole-source award. Impacts foreign military sales capabilities and readiness.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Potential for overpayment due to lack of competitive bidding.
- Long contract duration may not reflect current market prices.
Positive Signals
- Ensures critical maintenance for foreign military sales aircraft.
- Supports a key defense contractor, General Electric.
- Provides long-term service stability for engine upkeep.
Sector Analysis
This contract falls within the Aircraft Engine and Engine Parts Manufacturing sector, a critical component of the aerospace and defense industry. Spending in this sector is often characterized by high R&D costs, specialized manufacturing, and significant government contracts, particularly for military applications.
Small Business Impact
The contract was awarded to General Electric Company, a large business. There is no indication that small businesses were involved in this specific award, either as prime contractors or subcontractors. This sole-source award to a large entity bypasses opportunities for small business participation.
Oversight & Accountability
The Department of the Army awarded this contract. Oversight would typically involve monitoring contract performance, ensuring adherence to terms, and verifying the necessity and cost-effectiveness of the sole-source justification. The duration and value suggest a need for diligent oversight to protect taxpayer interests.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award lacks competitive justification.
- Potential for inflated pricing due to lack of competition.
- Limited transparency on price reasonableness.
- No apparent small business participation.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ks, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $28.3 million to GENERAL ELECTRIC COMPANY. REFURBISHMENT AND OVERHAUL OF TURBINE ENGINES FOR FOREIGN MILITARY SALES CUSTOMERS.
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $28.3 million.
What is the period of performance?
Start: 2024-10-03. End: 2027-09-30.
What is the specific justification for awarding this contract on a sole-source basis, and what steps were taken to ensure the price is fair and reasonable without competition?
The justification for a sole-source award is crucial for understanding why competition was bypassed. Typically, this involves demonstrating that only one responsible source can provide the required services or supplies. Without this justification, it's difficult to assess if the government adequately explored competitive options or obtained a fair price. The lack of transparency here raises concerns about potential overspending and missed opportunities for better value.
How does the per-unit cost of refurbishing these turbine engines compare to industry benchmarks or previous contracts for similar services, especially given the sole-source nature of this award?
Benchmarking the per-unit cost is challenging without a competitive process. Sole-source contracts often lack the price transparency that competition provides. To assess value, the Army should have conducted a thorough price analysis, comparing the proposed costs against historical data, commercial price lists (if applicable), and other available market information. The absence of this analysis makes it difficult to determine if the $28.3 million represents a fair market price.
What is the long-term strategic benefit of this sole-source contract for foreign military sales customers, and does it align with broader U.S. foreign policy and defense objectives?
This contract supports the operational readiness of allied nations by ensuring their aircraft engines are maintained. Strategically, it reinforces U.S. partnerships and interoperability within allied air forces. However, the sole-source nature raises questions about the long-term cost-effectiveness of maintaining these capabilities for allies. Aligning such contracts with broader foreign policy goals requires ensuring that the costs incurred do not unduly burden U.S. resources or create dependencies that could be exploited.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1000 WESTERN AVE, LYNN, MA, 01905
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: $28,300,858
Exercised Options: $28,300,858
Current Obligation: $28,300,858
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W58RGZ20D0069
IDV Type: IDC
Timeline
Start Date: 2024-10-03
Current End Date: 2027-09-30
Potential End Date: 2027-09-30 00:00:00
Last Modified: 2025-06-11
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