Army Awards $79M for 155MM Insensitive Munition Cartridges to American Ordnance LLC
Contract Overview
Contract Amount: $79,008,261 ($79.0M)
Contractor: American Ordnance LLC
Awarding Agency: Department of Defense
Start Date: 2016-04-28
End Date: 2023-12-31
Contract Duration: 2,803 days
Daily Burn Rate: $28.2K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: M795 155MM INSENSITIVE MUNITION (IM) CARTRIDGE
Place of Performance
Location: MIDDLETOWN, DES MOINES County, IOWA, 52638
State: Iowa Government Spending
Plain-Language Summary
Department of Defense obligated $79.0 million to AMERICAN ORDNANCE LLC for work described as: M795 155MM INSENSITIVE MUNITION (IM) CARTRIDGE Key points: 1. Significant award for critical munitions, indicating sustained demand. 2. Competition method suggests potential for price optimization, though specific details are limited. 3. Risk associated with single awardee for a key defense component. 4. Spending falls within the Ammunition Manufacturing sector.
Value Assessment
Rating: good
The award value of $79M over several years suggests a substantial contract. Benchmarking against similar ammunition contracts would be necessary for a precise value assessment, but the duration and quantity imply a reasonable price point for specialized munitions.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competition. This method might restrict the number of eligible bidders, potentially impacting the final price discovery compared to unrestricted full and open competition.
Taxpayer Impact: Taxpayer funds are allocated for essential defense materiel. The specific pricing structure and competition limitations will influence the overall efficiency of this expenditure.
Public Impact
Ensures readiness of artillery units with advanced, safer munitions. Supports domestic manufacturing capabilities for critical defense supplies. Contributes to the safety of personnel handling and deploying artillery.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition may not yield the best possible price.
- Reliance on a single contractor for a critical item.
- Long contract duration could lead to cost overruns if not managed effectively.
Positive Signals
- Award supports a key defense capability.
- Use of Insensitive Munitions enhances safety.
- Contract provides stable demand for a specialized manufacturer.
Sector Analysis
The Ammunition (except Small Arms) Manufacturing sector is vital for national defense. Spending benchmarks for similar large-caliber ammunition contracts would provide further context, but this award represents a significant investment in maintaining artillery capabilities.
Small Business Impact
This contract was awarded to American Ordnance LLC, a large business. There is no indication of small business participation in this specific award, which is common for large, specialized defense manufacturing contracts.
Oversight & Accountability
The Department of the Army is responsible for oversight. The contract type (FIRM FIXED PRICE) and delivery order structure suggest defined terms, but ongoing monitoring of performance and cost is crucial for accountability.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole awardee for a critical defense item.
- Limited competition may impact price efficiency.
- Long contract duration requires diligent oversight.
- Potential for supply chain vulnerability.
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, ia, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $79.0 million to AMERICAN ORDNANCE LLC. M795 155MM INSENSITIVE MUNITION (IM) CARTRIDGE
Who is the contractor on this award?
The obligated recipient is AMERICAN ORDNANCE LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $79.0 million.
What is the period of performance?
Start: 2016-04-28. End: 2023-12-31.
What is the unit cost of the 155MM IM Cartridge and how does it compare to industry benchmarks?
The provided data does not include the specific unit cost or quantity, making a direct comparison to industry benchmarks impossible. To assess value, the total award amount ($79M) would need to be divided by the number of units procured. Further analysis would require access to the contract's detailed line items and historical pricing data for similar munitions.
What are the specific risks associated with relying on American Ordnance LLC for this critical munition?
The primary risk is supply chain disruption if American Ordnance LLC faces production issues, financial instability, or unforeseen events. Dependence on a single source for a critical defense item like 155MM IM cartridges could also limit the government's leverage in future negotiations and potentially lead to higher costs or longer lead times if demand surges.
How effectively does this contract ensure the Department of the Army's readiness and modernization goals?
This contract directly supports the Army's readiness by ensuring a supply of modern, safer artillery ammunition. The Insensitive Munition (IM) feature enhances safety during transport, storage, and handling, reducing risks to personnel and equipment. Its effectiveness in meeting modernization goals depends on the cartridge's specific capabilities and integration with current and future artillery systems.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 17575 HIGHWAY 79, MIDDLETOWN, IA, 52638
Business Categories: Category Business, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $79,008,261
Exercised Options: $79,008,261
Current Obligation: $79,008,261
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W52P1J16D0050
IDV Type: IDC
Timeline
Start Date: 2016-04-28
Current End Date: 2023-12-31
Potential End Date: 2023-12-31 12:12:00
Last Modified: 2025-12-10
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