Wednesday, September 23, 2009

When is a fixed price offer really a fixed price offer?

Colin Clark at DoD Buzz has some interesting news on the recent "firm fixed price offer" touted in the media by alternate engine proponents.

We spoke with a source over the weekend who read us some emails which were apparently from Pentagon officials claiming that General Electric and Rolls Royce, makers of the F136, had not actually made the government a fixed price offer...

So I sent the Pentagon folks a series of questions, trying to get a firm fixed handle on the question. It turns out GE offered “what they called an F136 Fixed Price Concept,” one that the Pentagon folks said they believed “was presented in good faith.” The concept “included Not to Exceed values for Low Rate Initial Production Lot 5 (which equates to the 2011 timeframe),” according to the air warfare acquisition people.

So what has to happen for any of this to mean anything, beyond being clever maneuvers by powerful companies eager to convince lawmakers to give them money. GE/RR would have to offer — tah dah! — a proposal. Why, you ask? The air warfare folks said “a proposal would provide much more detail in order to properly analyze its value and ability to deliver to the specific requirements.”

Full post is here.

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