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Boeing overcharged the U.S. Air Force 8,000% above market for soap dispensers

(www.reuters.com)
152 points lr0 | 1 comments | 21 Nov 24 04:19 UTC | HN request time: 0s | source
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cjensen ◴[21 Nov 24 06:40 UTC] No.42201750[source]▶
The US has 222 C-17 Aircraft. A single C-17 costs over $300 million.

If you ask Boeing for soap dispenser parts for these, what should they cost? Boeing charged $149,072 for the dispensers. That's $671 per plane. Is that too much?

If you had to make these dispensers, make sure they conform to rules for aircraft parts and Air Force parts, provide formal responses to bids, etc., how much could you make them for?

It seems high to me. The article says 8000%, which is less than $10 per plane. So while it seems high, it's definitely not 8000% high.

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1. ano-ther ◴[21 Nov 24 13:35 UTC] No.42204171[source]▶
Here is the original report and the press release with pictures [1,2]

> The DoD OIG found that overpayment occurred because the Air Force did not:

> Validate the accuracy of data used for contract negotiation.

> Conduct contract surveillance to identify price increases during contract execution.

> Review invoices to determine fair and reasonable prices before payment.

> In addition, the DoD OIG found that the DoD did not require the contracting officer to verify the accuracy of the bill of materials before negotiation or to review invoices for allowable, allocable, and reasonable costs before payment.

This does not sound like expensive MilSpec. Wouldn’t it be fair to assume that the DoD Inspector General is aware of these before making such accusations?

[1] https://www.dodig.mil/reports.html/Article/3948601/audit-of-...

[2] https://www.dodig.mil/In-the-Spotlight/Article/3948604/press...