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RELEASE: Rep. Khanna to hold TransDigm accountable and continue his fight against waste, fraud, and abuse in the defense contracting industry

May 14, 2019
Press Release

Washington, DC – Tomorrow, Rep. Ro Khanna will chair a hearing titled, “DOD Inspector General Report on Excess Profits by TransDigm Group, Inc.” at 10:00am in 2154 Rayburn HOB in the House Committee on Oversight and Reform.

Two years ago, Rep. Khanna and Sen. Warren sent a letter to the Department of Defense (DOD) Inspector General (IG) asking them to investigate TransDigm’s excess profits and price gouging following a troubling audit report. The IG report found that TransDigm’s profit margins ranged from 17% to over 4,000%. The IG considered anything up to 15% as a reasonable profit.

“This hearing is not just about protecting American taxpayers but is also about our national security. I am hopeful TransDigm will agree to pay back to the taxpayer the excess profit they admittedly made on the backs of hard working Americans,” said Rep. Khanna.

TransDigm is a public corporation that manufactures and supplies parts for aircraft used by the United States (U.S.) Air Force and Army. TransDigm provides components for several military platforms, including the AH-64 Apache, C-17 Globemaster III, the FF-16 Fighting Falcon, and the CH-47 Chinook.1 According to the IG, from April 2012 through January 2017, DOD issued 4,942 contracts valued at $471 million to TransDigm. In response to a request from Rep. Khanna, the IG reviewed the prices for a sample of 47 parts purchased from TransDigm under contracts awarded by the Defense Logistics Agency (DLA) and the U.S. Army. The IG determined that “TransDigm earned $16.1 million in excess profit on 46 of the 47 parts it sold to the DLA and the Army for $26.2 million between January 2015 and January 2017.” The IG identified 12 parts that previously had been sold to DOD by another company.

 

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About the Office

Congressman Khanna represents the 17th District of California, which covers communities in Silicon Valley. Visit his website at khanna.house.gov. Follow him on Facebook, Twitter, and Instagram @RepRoKhanna.