Warren, Garamendi Call Out Boeing and TransDigm for Refusing to Provide Cost or Pricing Data to Defense Department, Potentially Price Gouging Taxpayers

Press Release

"The Truth in Negotiation Act, later renamed the Truthful Cost or Pricing Act, requires the government to obtain data to determine whether prices are fair and reasonable... DoD has reported, however, that there are "chronic issues' of contractors refusing to provide that data…(and) the new reports of contractor's refusal to provide pricing data are unacceptable. DoD must act to address this failure and protect taxpayer dollars.

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Boeing's refusal to provide basic transparency on cost and pricing information represents a breach of the company's duty to government, taxpayers, and our servicemembers, and raises questions about whether DoD should retain these contracts with Boeing. While Boeing refuses to provide DoD the data it needs to determine if its prices are fair and reasonable, the company continues to shovel taxpayer dollars to its executives and shareholders. Boeing has paid $1.2 billion in dividends in 2020, and engaged in a stock-buyback program of $18 billion in 2017. Executive compensation for FY2022 was nearly $58 million.

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When TransDigm refuses to act in good faith, there are two options for the DoD: buy from TransDigm at their exorbitant prices, or walk away without the parts they need, putting mission readiness at risk. While TransDigm refuses to provide DoD the data it needs to determine if its prices are fair and reasonable, the company continues to shovel taxpayer dollars out the door to its executives and shareholders via stock-buyback programs and generous executive compensation. In November 2017, TransDigm authorized a $650 million stock buy-back program and in FY2020, (the CEO) earned a salary increase of nearly 70 percent. The company authorized another stock buy-back program in January 2022 for $2.2 billion. The company paid its executives nearly $46 million in 2022."

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