DoD's $77M contract for shipbuilding and repairing services awarded to Teledyne Brown Engineering, Inc
Contract Overview
Contract Amount: $77,263,401 ($77.3M)
Contractor: Teledyne Brown Engineering, Inc.
Awarding Agency: Department of Defense
Start Date: 2011-06-30
End Date: 2017-12-30
Contract Duration: 2,375 days
Daily Burn Rate: $32.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: SWCS
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35805
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $77.3 million to TELEDYNE BROWN ENGINEERING, INC. for work described as: SWCS Key points: 1. The contract's cost-plus-incentive-fee structure aims to align contractor performance with government objectives. 2. Awarded under full and open competition, suggesting a robust market for these specialized services. 3. The duration of the contract (2375 days) indicates a long-term need for these shipbuilding and repairing capabilities. 4. The contract was awarded by the Defense Contract Management Agency, highlighting its role in overseeing critical defense procurements. 5. The North American Industry Classification System (NAICS) code 336611 points to significant activity in the shipbuilding and repairing sector. 6. The contract's value of approximately $77 million represents a substantial investment in naval readiness and maintenance.
Value Assessment
Rating: good
Benchmarking the value of this contract requires detailed comparison with similar shipbuilding and repair contracts, considering the specific scope of work and complexity. The cost-plus-incentive-fee (CPIF) pricing model suggests that the final cost could vary based on performance, making a direct price comparison challenging without performance data. However, the contract's duration and the nature of defense procurement imply a need for specialized capabilities that may justify the investment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple capable vendors had the opportunity to bid. The presence of 3 offers suggests a competitive environment, which typically leads to better price discovery and potentially more favorable terms for the government. The agency's decision to pursue full and open competition implies confidence in the market's ability to provide the required services.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and improve the quality of services received. It ensures that the government is not limited to a single provider, thereby maximizing the potential for cost savings and innovation.
Public Impact
The primary beneficiaries are the U.S. Navy and other Department of Defense entities requiring shipbuilding and repair services. The contract delivers essential services for maintaining and potentially upgrading naval vessels, crucial for national security. The geographic impact is centered in Alabama, where Teledyne Brown Engineering, Inc. is located, potentially creating or sustaining jobs in that region. The contract supports a specialized workforce within the shipbuilding and repair industry, including engineers, technicians, and skilled laborers.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The cost-plus-incentive-fee structure can lead to cost overruns if not managed diligently, as contractor incentives may not perfectly align with cost containment.
- The long contract duration (over 6 years) increases the risk of scope creep or evolving requirements that may not be fully captured in the initial pricing.
- Reliance on a single prime contractor for such a critical function could pose a risk if the contractor faces financial or operational difficulties.
Positive Signals
- Awarding under full and open competition suggests a healthy market and potentially competitive pricing.
- The incentive fee component encourages contractor performance and efficiency, potentially leading to better outcomes.
- The contract's focus on shipbuilding and repair addresses a fundamental need within the defense sector, ensuring operational readiness.
Sector Analysis
The shipbuilding and repairing sector is a critical component of the defense industrial base, supporting naval operations and national security. This contract falls within the broader manufacturing sector, specifically heavy-duty machinery and equipment manufacturing. Comparable spending benchmarks would involve analyzing other large-scale defense contracts for vessel maintenance, overhaul, and construction, considering the specialized nature of the work and the high barriers to entry in this industry.
Small Business Impact
The data indicates that small business participation was not a primary focus for this contract, as the prime contractor is Teledyne Brown Engineering, Inc., a large entity, and the 'sb' (small business) flag is false. There is no explicit mention of small business set-asides. Subcontracting opportunities for small businesses may exist, but they are not detailed in this summary. The impact on the small business ecosystem would depend on the extent to which Teledyne Brown Engineering, Inc. utilizes small business subcontractors for specialized components or services.
Oversight & Accountability
Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance with contract terms. Accountability measures would be embedded within the cost-plus-incentive-fee structure, linking contractor payment to performance metrics. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance details may be sensitive.
Related Government Programs
- Naval Sea Systems Command (NAVSEA) Contracts
- Shipbuilding and Repair Contracts
- Defense Contract Management Agency (DCMA) Procurements
- Department of Defense Maintenance, Repair, and Overhaul (MRO) Services
Risk Flags
- Long contract duration may increase risk of scope creep.
- Cost-plus-incentive-fee structure requires careful monitoring to ensure cost control.
- Reliance on a single prime contractor for critical services.
Tags
defense, department-of-defense, teledyne-brown-engineering, shipbuilding-and-repairing, delivery-order, full-and-open-competition, cost-plus-incentive-fee, alabama, defense-contract-management-agency, large-business, naval-vessels, defense-industrial-base
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $77.3 million to TELEDYNE BROWN ENGINEERING, INC.. SWCS
Who is the contractor on this award?
The obligated recipient is TELEDYNE BROWN ENGINEERING, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $77.3 million.
What is the period of performance?
Start: 2011-06-30. End: 2017-12-30.
What is the historical spending pattern for Teledyne Brown Engineering, Inc. with the Department of Defense, particularly in shipbuilding and repair?
Analyzing Teledyne Brown Engineering, Inc.'s historical spending with the Department of Defense requires access to comprehensive contract databases. However, based on the provided data, this $77 million contract awarded in 2011 represents a significant engagement. To provide a full picture, one would need to examine prior and subsequent contracts awarded to Teledyne Brown Engineering, Inc. by the DoD, looking at the total value, duration, and specific services rendered. This would help establish a pattern of their involvement in shipbuilding and repair, identify any trends in contract types (e.g., fixed-price vs. cost-plus), and assess their consistent performance or growth within this sector. Understanding their track record with similar contracts, including any performance issues or successes, is crucial for evaluating the current contract's risk and value.
How does the cost-plus-incentive-fee (CPIF) structure of this contract compare to industry standards for similar shipbuilding and repair services?
The Cost-Plus-Incentive-Fee (CPIF) structure is common in complex defense contracts where the final cost is uncertain, aiming to incentivize contractor efficiency. For shipbuilding and repair, especially for specialized naval vessels, CPIF is often employed due to the inherent risks and potential for unforeseen technical challenges. Industry standards vary, but CPIF is generally preferred over fixed-price contracts when the scope of work is not fully defined or when technological uncertainties exist. The effectiveness of this structure hinges on the clarity of the performance targets and the fairness of the incentive/disincentive clauses. Benchmarking would involve comparing the target cost, incentive sharing ratio, and ceiling price against similar contracts awarded by the DoD or other government agencies to similar contractors. A well-structured CPIF contract should demonstrate a reasonable balance between risk sharing and performance motivation.
What are the key performance indicators (KPIs) used to assess Teledyne Brown Engineering, Inc.'s performance under this contract?
While the specific Key Performance Indicators (KPIs) for this contract are not detailed in the provided summary, they are typically defined within the contract's Statement of Work (SOW) and Performance Work Statement (PWS). For shipbuilding and repair contracts, common KPIs often include adherence to delivery schedules, quality of workmanship (e.g., defect rates, rework required), compliance with safety regulations, and achievement of technical performance specifications. Under a CPIF contract, specific performance targets related to cost reduction, schedule adherence, and technical milestones would be established. The incentive fees would then be awarded based on the contractor's performance against these pre-defined metrics. Regular progress reviews and inspections by the contracting officer's representative (COR) would monitor these KPIs.
What is the potential impact of this contract on the small business ecosystem within Alabama's shipbuilding and repair sector?
The direct award to Teledyne Brown Engineering, Inc., a large business, suggests that this specific contract was not set aside for small businesses. However, the impact on Alabama's small business ecosystem is not necessarily negative. Large prime contractors are often required to meet small business subcontracting goals. If Teledyne Brown Engineering, Inc. actively seeks out and utilizes small businesses for specialized components, services (like welding, painting, or specific engineering support), or logistics, it can create significant opportunities. The extent of this impact depends on the prime contractor's subcontracting plan and execution. A robust subcontracting program could stimulate growth and capacity building within local small businesses, fostering a stronger regional supply chain for the defense industry.
How does the $77 million contract value compare to the overall annual spending on shipbuilding and repair by the Department of Defense?
The $77 million contract value represents a specific investment in shipbuilding and repair services over its duration. To contextualize this, one must compare it to the Department of Defense's overall annual spending in this category. DoD's shipbuilding and repair budget is substantial, often running into billions of dollars annually, encompassing new ship construction, major overhauls, routine maintenance, and modernization programs across the Navy and other maritime services. Therefore, this $77 million contract, while significant for the contractor and the specific project, is likely a component of a much larger overall defense spending portfolio for shipbuilding and repair. Analyzing its proportion relative to the total annual budget would indicate its strategic importance and scale within the broader DoD procurement landscape.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 3
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Teledyne Technologies Incorporated (UEI: 112358432)
Address: 300 SPARKMAN DR NW, HUNTSVILLE, AL, 35805
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $77,412,087
Exercised Options: $77,412,087
Current Obligation: $77,263,401
Subaward Activity
Number of Subawards: 135
Total Subaward Amount: $19,751,735
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: H9222211D0002
IDV Type: IDC
Timeline
Start Date: 2011-06-30
Current End Date: 2017-12-30
Potential End Date: 2017-12-30 00:00:00
Last Modified: 2020-03-27
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