DoD's $24.8M BEAR POWER UNITS contract to Cummins Power Generation Inc. awarded under full and open competition

Contract Overview

Contract Amount: $24,872,000 ($24.9M)

Contractor: Cummins Power Generation Inc.

Awarding Agency: Department of Defense

Start Date: 2014-12-17

End Date: 2016-06-10

Contract Duration: 541 days

Daily Burn Rate: $46.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: BEAR POWER UNITS

Place of Performance

Location: MINNEAPOLIS, ANOKA County, MINNESOTA, 55432

State: Minnesota Government Spending

Plain-Language Summary

Department of Defense obligated $24.9 million to CUMMINS POWER GENERATION INC. for work described as: BEAR POWER UNITS Key points: 1. Value for money appears reasonable given the contract's duration and the nature of power generation equipment. 2. Competition dynamics indicate a full and open process, suggesting potential for competitive pricing. 3. Risk indicators are moderate, with a fixed-price contract type mitigating some cost overrun risks. 4. Performance context is within the Department of the Air Force's operational needs for power units. 5. Sector positioning is within the Motor and Generator Manufacturing industry, a critical support function for military operations.

Value Assessment

Rating: good

The contract value of $24.8 million over approximately 18 months for BEAR POWER UNITS suggests a significant investment in essential equipment. Benchmarking against similar large-scale power generation contracts for military applications indicates that this price point is within a typical range, considering the specialized nature and durability requirements. The firm fixed-price structure further supports the assessment of value by locking in costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The presence of 6 bids indicates a healthy level of interest and competition for this requirement. This broad competition is generally favorable for price discovery and ensures the government receives offers from a wide range of qualified vendors.

Taxpayer Impact: A competitive bidding process like this one helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

The primary beneficiaries are the Department of the Air Force, receiving critical power generation capabilities. Services delivered include the provision of BEAR POWER UNITS, essential for maintaining operational readiness in various environments. The geographic impact is likely concentrated at Air Force installations where these units are deployed. Workforce implications may include roles in installation, maintenance, and operation of the power units.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for long-term maintenance costs not fully captured in the initial award.
Dependence on a single manufacturer for specialized BEAR POWER UNITS could pose supply chain risks.
Ensuring interoperability with existing infrastructure requires careful planning and execution.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process.
Firm fixed-price contract type helps control costs and budget predictability.
The contract specifies delivery orders, allowing for phased deployment and management of resources.
The contractor, Cummins Power Generation Inc., is a recognized industry leader in power solutions.

Sector Analysis

This contract falls within the Motor and Generator Manufacturing sector, specifically supporting the defense industry's need for reliable power solutions. The market for military-grade power generation equipment is characterized by stringent performance requirements, durability, and often, specialized features for deployment in diverse and challenging environments. Comparable spending benchmarks in this sector would involve other large-scale procurements of generators, mobile power units, and related support services for government and defense agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem appears limited for this specific award. However, the prime contractor may engage small businesses for components or support services, which would be detailed in their subcontracting plan if applicable.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Air Force program management office. Accountability measures are embedded in the firm fixed-price contract terms and delivery schedules. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Tactical Power Systems
Mobile Electric Power
Generator Sets
Defense Logistics Agency (DLA) Energy
Expeditionary Power Systems

Risk Flags

Potential for obsolescence of technology over the contract's lifecycle.
Dependence on specific spare parts availability.
Ensuring adequate training for maintenance personnel.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.9 million to CUMMINS POWER GENERATION INC.. BEAR POWER UNITS

Who is the contractor on this award?

The obligated recipient is CUMMINS POWER GENERATION INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $24.9 million.

What is the period of performance?

Start: 2014-12-17. End: 2016-06-10.

What is the historical spending pattern for BEAR POWER UNITS by the Department of the Air Force?

Analyzing historical spending for BEAR POWER UNITS by the Department of the Air Force requires access to detailed contract databases over multiple fiscal years. While this specific contract represents a $24.8 million award, understanding the broader trend involves looking at the frequency and value of similar procurements. Factors such as technological upgrades, changes in operational tempo, and budget allocations significantly influence these patterns. For instance, periods of increased global deployment or modernization efforts might correlate with higher spending on such essential equipment. Without a comprehensive historical dataset for this specific item, it's challenging to pinpoint precise trends, but it's reasonable to assume consistent investment in reliable power solutions is a standing requirement for the Air Force.

How does the unit cost of these BEAR POWER UNITS compare to commercial equivalents?

Directly comparing the unit cost of military-specific BEAR POWER UNITS to commercial equivalents is complex due to significant differences in specifications and intended use. Military units often incorporate enhanced durability, ruggedization for extreme environments, specialized power outputs, and compliance with stringent military standards (e.g., MIL-SPEC), which inherently increase costs. Commercial generators, while potentially offering similar raw power, may lack these robust features. Therefore, a direct price-per-kilowatt comparison might be misleading. The $24.8 million award for an unspecified number of units suggests a substantial per-unit cost, likely reflecting the specialized nature and lifecycle support requirements inherent in military procurement, rather than a simple commodity purchase.

What are the key performance indicators (KPIs) used to evaluate the success of this contract?

The success of this contract would likely be evaluated against several key performance indicators (KPIs) tied to the delivery and performance of the BEAR POWER UNITS. Primary KPIs would include on-time delivery of all units as per the schedule outlined in the delivery orders, and adherence to technical specifications, ensuring the units meet or exceed the required power output, reliability, and environmental resilience standards. Post-delivery, performance might be assessed through operational uptime, maintenance requirements (or lack thereof), and successful integration into existing Air Force power infrastructure. Customer satisfaction surveys from the end-users at the Air Force installations would also serve as a qualitative KPI. Failure to meet these KPIs could trigger contractual remedies.

What is the track record of Cummins Power Generation Inc. in fulfilling similar government contracts?

Cummins Power Generation Inc. has a well-established track record as a major supplier of power generation solutions, including to government and military entities. They are known for producing a wide range of generators and power systems that meet demanding specifications. Historically, their involvement in government contracts often centers on providing reliable and durable power equipment for various applications, from base operations to mobile tactical support. While specific performance details for every contract are not publicly available, their continued presence and success in securing large awards like this one suggest a generally positive history of performance and capability in meeting the requirements of federal agencies, including the Department of Defense.

What are the potential risks associated with the long-term sustainment and maintenance of these power units?

Long-term sustainment and maintenance of these BEAR POWER UNITS present several potential risks. Firstly, the availability and cost of spare parts could become an issue over the lifespan of the equipment, especially if newer models are introduced or if the specific components become obsolete. Secondly, the need for specialized technicians trained on these particular units could strain military maintenance resources or require costly contractor support. Thirdly, the operational environment for military equipment is often harsh, leading to accelerated wear and tear, potentially increasing the frequency and cost of maintenance beyond initial projections. Finally, ensuring continuous operational readiness might necessitate robust service contracts or depot-level maintenance capabilities, adding to the total cost of ownership.

Industry Classification

NAICS: Manufacturing › Electrical Equipment Manufacturing › Motor and Generator Manufacturing

Product/Service Code: ELECTRIC WIRE, POWER DISTRIB EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Cummins Inc. (UEI: 006415160)

Address: 1400 73RD AVE NE, MINNEAPOLIS, MN, 55432

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: $24,872,000

Exercised Options: $24,872,000

Current Obligation: $24,872,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA853309D0004

IDV Type: IDC

Timeline