Boeing Found to Overcharge Pentagon by $13.7 Million

Boeing Co. (BA) overcharged the Pentagon’s primary parts-buying agency $13.7 million in 1,469 parts orders after government personnel failed to negotiate “fair and reasonable prices,” according to the Pentagon’s inspector general.

The inspector general recommended that the Defense Logistics Agency “implement available options to recover from Boeing the overpayment” and renegotiate for overpaid parts, it said in a report summary posted today on its website. It didn’t say which military systems the parts were for.

“Pricing problems occurred because DLA Aviation contracting officers did not conduct a fair and reasonable price analysis,” according to the audit summary. “If prices are not corrected, DLA Aviation will continue to overpay on future sole-source spare parts procured from Boeing.”

Boeing spokesman Todd Blecher said in an e-mail that the Chicago-based company had no immediate comment. The inspector general’s summary said the defense agency provided comments that were responsive to its criticism.

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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