The objective of this audit was to determine whether the Air Force purchased spare parts at fair and reasonable prices for the C‑17 military transport aircraft under the performance‑based logistics contracts.
We initiated the audit in response to an allegation to the DoD Hotline concerning spare parts pricing. The allegation stated that the Boeing Company (Boeing) overcharged the Air Force for a lavatory soap dispenser used on the C‑17. The C‑17 is the Air Force’s cargo aircraft and is used for military, humanitarian, and peacekeeping missions.
On October 1, 2011, the C‑17 Globemaster III Division awarded Boeing a 10‑year, $11.8 billion sole‑source acquisition contract for the C‑17 Globemaster III Integrated Sustainment Program (GISP). On September 28, 2021, the Air Force awarded Boeing the Globemaster III Sustainment (G3) contract, a follow‑on $23.8 billion contract, which continues service to the C‑17 through 2031. Through the GISP and the G3 contracts, Boeing purchased the needed spare parts for the C‑17 and the Air Force reimbursed Boeing for the spare parts purchased.