It’s been a challenging year for Boeing — one that’s included everything from a federal investigation to mechanical issues to a mysterious metal showing up in some plane parts. There’s also the matter of tens of thousands of Boeing workers currently on strike for better wages. Those aren’t the only challenges the company is facing; now, the federal government has accused Boeing of overcharging it for components of the C-17.
This week, the Department of Defense Office of Inspector General announced the results of its audit of the Air Force’s purchase parts for C-17 military transport planes. According to the agency’s findings, the Air Force did overpay for the parts in question. As Inspector General Robert P. Storch explained, this could have consequences beyond the government paying more than expected for airplane components.
“Significant overpayments for spare parts may reduce the number of spare parts that Boeing can purchase on the contract, potentially reducing C-17 readiness worldwide,” Storch said in a statement.
The Office of Inspector General found that the Air Force had overpaid for 26% of the parts reviewed by the audit. Perhaps more alarming than that was the audit’s discovery that, for 54% of the spare parts reviewed, it was unable to determine if the Air Force had overpaid due to a lack of historical data.
The most egregious example of overcharging came in the form of a bathroom soap dispenser. The Office of Inspector General found that “the Air Force paid more than 80 times the commercially available cost or a 7,943-% markup.”
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What’s next for the troubled airline manufacturer?In their account of the audit’s findings for the Associated Press, Tara Copp and David Koenig noted that the U.S. government has spent in excess of $30 billion in contracts to Boeing in the last 13 years. These contracts covered assorted parts needed for the C-17. The Office of Inspector General’s announcement of the audit results includes a few common-sense recommendations, including being aware of price increases during negotiations and revisiting past invoices for the price data found there.
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