Contracting Officers' Explanations for Price Increases on 125 Spare Parts
NSIAD-85-119: Published: Jul 29, 1985. Publicly Released: Jul 29, 1985.
Additional Materials:
- Full Report:
Contact:
In response to a congressional request, GAO obtained explanations from Department of Defense contracting officers for price increases on 125 spare parts and reviewed some cost and pricing data for two contractors.
Contracting officers cited many reasons for the price increases, including: (1) inflation; (2) differences in quantity purchased; (3) events that occurred during elapsed time between procurements; and (4) the markups of small businesses on spare parts purchased in small business set-aside programs. GAO found that most parts showed a lower price increase after the effects of inflation were removed. For many parts, there was a significant change in the quantity ordered and a long time period between the old and new procurements. GAO also found that the contractor for 46 of the 125 parts: (1) increased its prices because it purchased material from subcontractors in excess of the government's needs and transferred some production facilities; and (2) overpriced some of the parts but voluntarily refunded the overpricing and revised its contracts and pricing procedures to correct the overpricing conditions. Another major contractor increased its prices because of increases in the costs of labor and material and accounting system changes. In addition, GAO found that: (1) problems existed with price analysis and procurement due to the large volume of contracts to be processed; and (2) in approximately 20 percent of the awards competition determined the price. The procurements which GAO reviewed were made before certain corrective actions were taken, and GAO expects the price analysis of spare parts to improve if these corrective actions are properly implemented.
Jan 14, 2021
-
Columbia Class Submarine:
Delivery Hinges on Timely and Quality Materials from an Atrophied Supplier BaseGAO-21-257: Published: Jan 14, 2021. Publicly Released: Jan 14, 2021. -
Department of Defense:
Actions Needed to Improve Accounting of Intradepartmental TransactionsGAO-21-84: Published: Jan 14, 2021. Publicly Released: Jan 14, 2021.
Jan 12, 2021
-
DOD Critical Technologies:
Plans for Communicating, Assessing, and Overseeing Protection Efforts Should Be CompletedGAO-21-158: Published: Jan 12, 2021. Publicly Released: Jan 12, 2021.
Dec 10, 2020
-
Climate Resilience:
DOD Coordinates with Communities, but Needs to Assess the Performance of Related Grant ProgramsGAO-21-46: Published: Dec 10, 2020. Publicly Released: Dec 10, 2020. -
Electromagnetic Spectrum Operations:
DOD Needs to Address Governance and Oversight Issues to Help Ensure SuperiorityGAO-21-64: Published: Dec 10, 2020. Publicly Released: Dec 10, 2020.
Dec 2, 2020
-
Navy and Marine Corps:
Services Continue Efforts to Rebuild Readiness, but Recovery Will Take Years and Sustained Management AttentionGAO-21-225T: Published: Dec 2, 2020. Publicly Released: Dec 2, 2020.
Nov 20, 2020
-
GAO Audits Involving DOD:
Status of Efforts to Schedule and Hold Timely Entrance ConferencesGAO-21-185R: Published: Nov 20, 2020. Publicly Released: Nov 20, 2020.
Nov 19, 2020
-
Defense Acquisitions:
Joint Cyber Warfighting Architecture Would Benefit from Defined Goals and GovernanceGAO-21-68: Published: Nov 19, 2020. Publicly Released: Nov 19, 2020. -
Defense Intelligence:
Comprehensive Plan Needed to Improve Stakeholder Engagement in the Development of New Military Intelligence SystemGAO-21-57: Published: Nov 19, 2020. Publicly Released: Nov 19, 2020. -
Defense Production Act:
Opportunities Exist to Increase Transparency and Identify Future Actions to Mitigate Medical Supply Chain Issues:GAO-21-108: Published: Nov 19, 2020. Publicly Released: Nov 19, 2020.
Looking for more? Browse all our products here