US Air Force wildly overpaid Boeing by almost 8,000% for C-17 aircraft bathroom soap dispensers, Pentagon watchdog finds

Across the board, the office said the service failed to consistently pay reasonable prices for about 26% of spare parts reviewed, valued at $4.3 million.

But the OIG was unable to effectively review over half of the total spare parts — estimated at more than $22 million in value — “because the Air Force did not maintain historical cost data, and the Defense Contract Management Agency Item Group was unable to obtain supplier quotes or identify commercially similar parts,” the office said.

The OIG attributed the overpayment problem to the Air Force’s failure to sufficiently validate accurate data for contract negotiation, identify price increases while executing contracts, and review invoices to determine fair and reasonable before paying.

“We are reviewing the report, which appears to be based on an inapt comparison of the prices paid for parts that meet military specifications and designs versus basic commercial items that would not be qualified or approved for use on the C-17,” Boeing spokeswoman Deborah VanNierop told Bloomberg, which first reported the overpayments identified by the OIG.

“We will continue to work with the OIG and the US Air Force to provide a detailed written response to the report in the coming days,” she said.

Per Inspector General Robert P. Storch, the Air Force’s issues could have an impact on C-17 readiness.

“The Air Force needs to establish and implement more effective internal controls to help prevent overpaying for spare parts for the remainder of this contract, which continues through 2031,” he said, adding that “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.”

The C-17 Globemaster III is a large versatile aircraft designed to transport troops and equipment across a variety of distances. It’s the Air Force’s primary strategic lift aircraft. It has also become a central aircraft in evacuation and humanitarian efforts, among other missions.