DoD's $210M contract for automotive repair services awarded to VSE Corporation shows fair value and strong competition
Contract Overview
Contract Amount: $210,017,975 ($210.0M)
Contractor: VSE Corporation
Awarding Agency: Department of Defense
Start Date: 2015-12-17
End Date: 2020-01-15
Contract Duration: 1,490 days
Daily Burn Rate: $141.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: LABOR HOURS
Sector: Defense
Official Description: IGF::OT::IGF HOURLY LABOR OF MECHANICS, PAINTERS AND OTHER SCA COVERED LABOR CATEGORIES AT RED RIVER ARMY DEPOT
Place of Performance
Location: TEXARKANA, BOWIE County, TEXAS, 75501
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $210.0 million to VSE CORPORATION for work described as: IGF::OT::IGF HOURLY LABOR OF MECHANICS, PAINTERS AND OTHER SCA COVERED LABOR CATEGORIES AT RED RIVER ARMY DEPOT Key points: 1. The contract demonstrates a commitment to value for money through competitive bidding. 2. Strong competition dynamics suggest favorable pricing for the government. 3. Risk indicators appear low given the established contractor and service type. 4. Performance context is within general automotive repair, a standard service category. 5. Sector positioning is within the Defense sector, supporting military readiness. 6. The contract's duration and value indicate a significant, ongoing need for these services.
Value Assessment
Rating: good
The contract's total value of approximately $210 million over its period of performance suggests a substantial investment in automotive repair services. Benchmarking against similar contracts for general automotive repair is challenging without specific service details, but the competitive nature of the award implies that VSE Corporation's pricing was deemed reasonable at the time of contract award. The contract type, focusing on labor hours, allows for flexibility in addressing varying repair needs, which can contribute to overall value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of six bidders (no) suggests a healthy level of competition for this requirement. This broad competition is beneficial as it typically drives down prices and encourages contractors to offer their best value propositions to secure the award.
Taxpayer Impact: The full and open competition ensures that taxpayer dollars are used efficiently by leveraging market forces to obtain competitive pricing for essential automotive repair services.
Public Impact
The primary beneficiaries are the Department of Defense and its various units requiring maintenance and repair of automotive equipment. Services delivered include general automotive repair, likely encompassing a wide range of maintenance, diagnostics, and repair for vehicles and equipment. The geographic impact is centered in Texas (st: TX, sn: TEXAS), specifically at the Red River Army Depot, supporting regional military operations. Workforce implications include the employment of mechanics, painters, and other skilled labor covered by the Service Contract Act (SCA).
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if labor hour estimates are not managed effectively.
- Dependence on a single contractor (VSE CORPORATION) for a significant period could limit future flexibility or price negotiation.
- Scope creep could increase the total contract value beyond initial projections if not carefully monitored.
Positive Signals
- Awarded through full and open competition, indicating a competitive pricing environment.
- Contractor (VSE CORPORATION) has a track record, suggesting experience in fulfilling similar requirements.
- The contract addresses a critical operational need for vehicle and equipment maintenance, ensuring readiness.
- The use of labor hours provides flexibility to adapt to evolving repair demands.
Sector Analysis
The defense sector relies heavily on robust maintenance and repair services to ensure the operational readiness of its vast fleet of vehicles and equipment. This contract falls within the broader category of industrial services and general automotive repair, a market segment that supports both government and commercial entities. The size of this contract, exceeding $210 million, indicates a significant requirement for specialized labor and services at a key military installation. Comparable spending benchmarks would typically involve analyzing other large-scale maintenance contracts within the Department of Defense or similar government agencies for vehicle and equipment support.
Small Business Impact
This contract does not appear to have a specific small business set-aside (ss: false, sb: false). While VSE CORPORATION is a large business, the contract's structure does not preclude small businesses from subcontracting opportunities. The extent of small business participation would depend on VSE CORPORATION's subcontracting plan and the availability of qualified small businesses for specialized repair tasks or support services.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army, with specific oversight responsibilities likely assigned to contracting officers and program managers at Red River Army Depot. Accountability measures are embedded in the contract terms, including performance standards and delivery schedules. Transparency is facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.
Related Government Programs
- Department of Defense Maintenance and Repair Contracts
- Army Logistics and Readiness Support
- General Automotive Repair Services
- Service Contract Act Compliance
- Defense Industrial Base Support
Risk Flags
- Potential for cost growth if labor rates fluctuate significantly.
- Dependence on contractor performance for critical maintenance operations.
- Need for robust government oversight to ensure quality and prevent scope creep.
Tags
defense, department-of-defense, department-of-the-army, automotive-repair, general-automotive-repair, labor-hours, full-and-open-competition, delivery-order, texas, vse-corporation, sca-covered-labor
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $210.0 million to VSE CORPORATION. IGF::OT::IGF HOURLY LABOR OF MECHANICS, PAINTERS AND OTHER SCA COVERED LABOR CATEGORIES AT RED RIVER ARMY DEPOT
Who is the contractor on this award?
The obligated recipient is VSE CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $210.0 million.
What is the period of performance?
Start: 2015-12-17. End: 2020-01-15.
What is the historical spending pattern for automotive repair services at Red River Army Depot prior to this contract?
Analyzing historical spending patterns for automotive repair at Red River Army Depot prior to this $210 million contract would provide crucial context for assessing its value and necessity. Without specific historical data, it's difficult to determine if this contract represents an increase, decrease, or stable level of spending. However, the duration of the contract (2015-2020) and its substantial value suggest a consistent and significant requirement for these services. Understanding past expenditures would help identify trends, potential efficiencies gained or lost, and whether previous contracts were also competitively awarded. This information is vital for evaluating if the current contract's pricing and scope are aligned with long-term needs and budget allocations for depot maintenance operations.
How does the awarded price per labor hour compare to industry benchmarks for similar SCA-covered labor categories?
Comparing the awarded price per labor hour to industry benchmarks for similar Service Contract Act (SCA) covered labor categories is essential for a thorough value assessment. The provided data does not include specific hourly rates, only the total contract value and labor hours. To perform this comparison, one would need to identify the specific SCA wage determinations applicable to mechanics, painters, and other covered roles at Red River Army Depot during the contract period (2015-2020). Subsequently, these rates would be benchmarked against prevailing wage data from sources like the Bureau of Labor Statistics (BLS) or industry surveys for comparable geographic regions and skill sets. A significant deviation from benchmarks, either higher or lower, would warrant further investigation into the reasons behind the pricing.
What are the specific performance metrics and quality assurance measures included in the contract?
The contract details provided do not specify the performance metrics or quality assurance measures. However, for a contract of this magnitude and duration, it is standard practice to include detailed performance work statements (PWS) outlining expected service levels, response times, and quality standards. Quality assurance surveillance plans (QASP) would typically be implemented by the government to monitor contractor performance against these metrics. These might include inspections, customer feedback mechanisms, and tracking of rework rates. The effectiveness of these measures is crucial for ensuring that the automotive repair services meet the DoD's stringent operational requirements and that the contractor is held accountable for delivering high-quality work.
What is VSE CORPORATION's track record with similar large-scale maintenance and repair contracts for the Department of Defense?
VSE CORPORATION has a significant track record in providing a wide range of services to the Department of Defense, including logistics, maintenance, and technical support. While specific details on their performance for automotive repair contracts of this exact scale are not provided here, their established presence suggests experience in managing complex government contracts. A deeper dive into their contract history, including past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), would reveal their reliability, quality of service, and ability to manage large budgets and diverse teams. This information is critical for assessing the risk associated with awarding such a substantial contract to them.
How has the shift towards electric and alternative fuel vehicles impacted the demand for traditional automotive repair services within the DoD?
The increasing adoption of electric and alternative fuel vehicles within the DoD presents a dynamic shift impacting traditional automotive repair services. While this contract (2015-2020) predates the most aggressive phases of this transition, the underlying trend suggests a future need for specialized skills and equipment to service these new platforms. For traditional internal combustion engine vehicles, the demand for repair services remains high due to the large existing fleet. However, long-term strategic planning for vehicle maintenance must account for the evolving fleet composition. This may necessitate retraining existing personnel, acquiring new diagnostic tools, and potentially establishing separate service contracts for electric vehicle maintenance to ensure continued operational readiness across diverse vehicle types.
Industry Classification
NAICS: Other Services (except Public Administration) › Automotive Repair and Maintenance › General Automotive Repair
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 6
Pricing Type: LABOR HOURS (Z)
Evaluated Preference: NONE
Contractor Details
Address: 6348 WALKER LANE, ALEXANDRIA, VA, 22310
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $210,028,225
Exercised Options: $210,017,975
Current Obligation: $210,017,975
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W56HZV15DER18
IDV Type: IDC
Timeline
Start Date: 2015-12-17
Current End Date: 2020-01-15
Potential End Date: 2020-01-15 12:01:00
Last Modified: 2023-06-06
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