DoD's $22.2M Raydon Corp. contract for tactical wheeled variants shows fair value despite limited competition

Contract Overview

Contract Amount: $22,251,349 ($22.3M)

Contractor: Raydon Corporation

Awarding Agency: Department of Defense

Start Date: 2013-06-07

End Date: 2018-09-29

Contract Duration: 1,940 days

Daily Burn Rate: $11.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CDT TACTICAL WHEELED VARIANT (TWV)

Place of Performance

Location: PORT ORANGE, VOLUSIA County, FLORIDA, 32128

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $22.3 million to RAYDON CORPORATION for work described as: CDT TACTICAL WHEELED VARIANT (TWV) Key points: 1. Contract awarded at a competitive price point, indicating reasonable value for the specialized equipment. 2. Limited competition may have influenced final pricing, though the award price appears within market norms. 3. Contract performance period was extensive, suggesting a need for long-term supply and support. 4. The contract's fixed-price nature shifts performance risk to the contractor. 5. This award falls within the broader category of defense vehicle manufacturing and support. 6. The contractor, Raydon Corporation, has a history of supplying similar defense equipment.

Value Assessment

Rating: good

The contract's total value of $22.2 million over approximately five years suggests a per-year spend of around $4.4 million. Benchmarking against similar tactical wheeled vehicle procurements is challenging due to the specialized nature of the 'TWV' designation. However, the firm-fixed-price structure indicates that the government secured a defined scope of work at a set price, which is generally favorable. The award price appears reasonable when considering the complexity and specific requirements of military-grade wheeled vehicles.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, certain sources were excluded, potentially limiting the bidder pool. The presence of 4 bids suggests a degree of competition, but the exclusion of sources warrants further investigation into the rationale. This level of competition is moderate and may not have driven the absolute lowest price possible, but it did provide multiple options for the government.

Taxpayer Impact: While not fully open, the competition level still provided taxpayers with multiple bids, helping to ensure a more competitive price than a sole-source award. The exclusion of sources means potential savings from a wider competitive field may have been forgone.

Public Impact

The primary beneficiaries are the U.S. Army units requiring specialized tactical wheeled vehicles for operational readiness. The contract delivers essential wheeled vehicle platforms and potentially associated support services for military operations. The contract was performed in Florida, impacting the local economy and workforce in that region. This contract supports jobs within the defense manufacturing sector, specifically in the production of specialized vehicles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for higher costs due to exclusion of certain sources during competition.
Long contract duration (1940 days) increases risk of obsolescence or changing military requirements.
Firm-fixed-price contracts can lead to contractor disputes if scope creep occurs without change orders.

Positive Signals

Firm-fixed-price contract shifts cost overrun risk to the contractor.
Multiple bidders (4) indicate some level of market interest and potential for negotiation.
Contract awarded to Raydon Corporation, a known entity in defense vehicle manufacturing.

Sector Analysis

The defense vehicle manufacturing sector is a critical component of the U.S. industrial base, characterized by high technological requirements and stringent quality standards. Spending in this area is driven by military modernization efforts and operational demands. Contracts like this, for specialized wheeled variants, are common within the broader defense procurement landscape. Comparable spending benchmarks are difficult to establish precisely without detailed specifications but fall within the multi-million dollar range for such platforms.

Small Business Impact

The contract details indicate that small business participation was not a primary set-aside consideration (ss: false, sb: false). This suggests the primary award was made to a large business or that subcontracting opportunities were not specifically mandated or tracked as a set-aside. Further analysis would be needed to determine if Raydon Corporation utilized small businesses as subcontractors, which is common in defense manufacturing supply chains.

Oversight & Accountability

Oversight for this contract was likely managed by the Defense Contract Management Agency (DCMA), responsible for ensuring contractor performance and compliance. The firm-fixed-price nature of the award places a significant portion of the performance risk on the contractor. Transparency is generally maintained through contract award databases, though specific details of performance and any disputes would require deeper investigation. Inspector General jurisdiction would apply in cases of fraud or significant mismanagement.

Related Government Programs

Tactical Wheeled Vehicles
Military Truck Procurement
Defense Vehicle Manufacturing
Commercial and Service Industry Machinery Manufacturing
Department of Defense Contracts

Risk Flags

Limited Competition
Potential for Higher Costs
Long Contract Duration
Exclusion of Sources

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.3 million to RAYDON CORPORATION. CDT TACTICAL WHEELED VARIANT (TWV)

Who is the contractor on this award?

The obligated recipient is RAYDON CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $22.3 million.

What is the period of performance?

Start: 2013-06-07. End: 2018-09-29.

What is Raydon Corporation's track record with similar defense contracts?

Raydon Corporation has a history of securing and performing on defense contracts, particularly those involving the manufacturing and supply of vehicles and related equipment. While specific details on all past contracts require deeper database searches, their involvement in producing tactical wheeled variants suggests established capabilities and experience relevant to the DoD's needs. Their performance on previous contracts would be a key indicator of their reliability and ability to meet stringent military specifications and delivery schedules. Analyzing past contract awards, modifications, and any reported performance issues would provide a more comprehensive view of their track record.

How does the $22.2M award compare to market rates for similar tactical wheeled vehicles?

Directly comparing the $22.2 million award to precise market rates for 'CDT TACTICAL WHEELED VARIANT (TWV)' is challenging without detailed technical specifications and quantity breakdowns. However, the contract's firm-fixed-price nature and the fact that it resulted from a competition (albeit with exclusions) suggest the price was negotiated within a range deemed acceptable by the government. The average annual value of approximately $4.4 million for specialized military vehicles is not inherently excessive, considering the engineering, materials, and testing involved. Market rates for such niche defense equipment are often proprietary and vary significantly based on customization, survivability features, and technological integration.

What are the primary risks associated with this contract?

The primary risks associated with this contract include potential cost overruns if the contractor mismanages the firm-fixed-price structure, although this risk is primarily borne by the contractor. A significant risk is the long performance period (1940 days, over 5 years), which increases the likelihood of technological obsolescence or shifts in military requirements that could render the delivered variants less suitable over time. Furthermore, the 'Full and Open Competition After Exclusion of Sources' raises a risk that the exclusion of certain bidders may have limited the competitive pressure, potentially leading to a less optimal price for the government than could have been achieved in a truly open market.

How effective was the competition process in securing value for taxpayers?

The competition process, described as 'Full and Open Competition After Exclusion of Sources' with 4 bidders, offers a mixed picture regarding taxpayer value. While having multiple bidders is generally positive for price discovery, the exclusion of sources inherently limits the breadth of competition. This means that while taxpayers likely benefited from some price negotiation and comparison, the potential for even greater savings from a wider pool of bidders was likely forgone. The effectiveness hinges on the justification for excluding sources and whether the remaining bidders offered sufficiently competitive proposals to offset this limitation.

What is the historical spending trend for tactical wheeled vehicles by the DoD?

Historical spending by the DoD on tactical wheeled vehicles (TWVs) is substantial and fluctuates based on operational tempo, modernization programs, and specific platform needs. The DoD procures a wide array of TWVs, from light utility vehicles to heavy troop carriers and specialized variants like the one in this contract. Annual spending can range from billions to tens of billions of dollars across all types of wheeled vehicles. Contracts for specific variants, like the CDT TWV, represent a portion of this larger spending category. Analyzing trends requires looking at aggregate spending data for vehicle classes over multiple fiscal years to identify patterns in procurement volume and investment.

What are the implications of the contract's end date (2018) on current military readiness?

The contract's end date of September 29, 2018, means that the delivery and primary performance period for these specific tactical wheeled variants concluded several years ago. Therefore, this particular contract has no direct implications on *current* military readiness in terms of ongoing production or delivery. However, the vehicles procured under this contract would have been intended to contribute to readiness during their service life. The long-term effectiveness and maintenance of these vehicles would influence readiness. Any subsequent contracts for replacement, upgrades, or sustainment of these variants would be relevant to current readiness.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W900KK08R0001

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 210 FENTRESS BLVD, DAYTONA BEACH, FL, 32114

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business

Financial Breakdown

Contract Ceiling: $52,950,000

Exercised Options: $25,443,620

Current Obligation: $22,251,349

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W900KK09D0501

IDV Type: IDC

Timeline