DoD's $92.4M Electronic Kit Contract Awarded to General Dynamics-OTS, Inc. Lacked Competition
Contract Overview
Contract Amount: $92,416,081 ($92.4M)
Contractor: General Dynamics-Ots, Inc.
Awarding Agency: Department of Defense
Start Date: 2007-07-30
End Date: 2009-06-30
Contract Duration: 701 days
Daily Burn Rate: $131.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ELECTRONIC KIT, BROADBAND LIQUID COOLED
Place of Performance
Location: BURLINGTON, CHITTENDEN County, VERMONT, 05401
State: Vermont Government Spending
Plain-Language Summary
Department of Defense obligated $92.4 million to GENERAL DYNAMICS-OTS, INC. for work described as: ELECTRONIC KIT, BROADBAND LIQUID COOLED Key points: 1. The contract for electronic kits was awarded to General Dynamics-OTS, Inc. for $92.4 million. 2. The award was made without competition, raising questions about price discovery and value. 3. The lack of competition presents a significant risk of overpayment and reduced innovation. 4. The sector is Printed Circuit Assembly (Electronic Assembly) Manufacturing, a critical component in defense systems.
Value Assessment
Rating: questionable
The contract value of $92.4 million for electronic kits is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar contracts or industry benchmarks.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning no other vendors were considered. This significantly limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The absence of competition likely resulted in taxpayers paying more than necessary for these electronic kits.
Public Impact
Taxpayers may have overpaid due to the lack of competitive bidding on this significant contract. The Department of Defense's reliance on sole-source contracts can stifle innovation and reduce the availability of advanced technologies. The long contract duration (2007-2009) suggests a sustained period without competitive pressure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Potential Overpricing
- Limited Innovation
Positive Signals
- Awarded to established contractor
- Firm Fixed Price contract type
Sector Analysis
The Printed Circuit Assembly (Electronic Assembly) Manufacturing sector is vital for defense systems. Spending benchmarks in this area are highly variable based on complexity and volume, but competitive sourcing is generally preferred to ensure value.
Small Business Impact
There is no indication that small businesses were involved in this sole-source award, missing an opportunity to support smaller enterprises within the supply chain.
Oversight & Accountability
The sole-source nature of this award warrants further review to ensure the Department of Defense received the best possible value and that procurement regulations were appropriately followed.
Related Government Programs
- Printed Circuit Assembly (Electronic Assembly) Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition may have led to inflated prices.
- Potential for missed technological advancements due to no competitive pressure.
- Limited transparency in price determination.
- No apparent small business participation.
- Contract awarded over a decade ago, raising questions about current relevance and potential for renegotiation.
Tags
printed-circuit-assembly-electronic-asse, department-of-defense, vt, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $92.4 million to GENERAL DYNAMICS-OTS, INC.. ELECTRONIC KIT, BROADBAND LIQUID COOLED
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS-OTS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $92.4 million.
What is the period of performance?
Start: 2007-07-30. End: 2009-06-30.
What was the justification for awarding this contract on a sole-source basis, and was a thorough market research conducted to confirm no other capable vendors existed?
The justification for a sole-source award is critical for understanding the procurement's validity. Without competition, the government misses out on potential cost savings and technological advancements. A comprehensive market analysis should have been performed to identify all potential sources, ensuring the chosen vendor was truly the only viable option or that specific circumstances (like urgent need or unique capabilities) necessitated a non-competitive approach.
How was the 'fair and reasonable' price determined for this $92.4 million contract without competitive bids?
Determining a fair and reasonable price for a sole-source contract is challenging. Agencies typically rely on historical pricing data, commercial price lists, or independent government cost estimates. However, without the pressure of competing offers, there's an inherent risk that the price might be higher than what could have been achieved through a competitive process. Robust cost analysis and negotiation are essential in such scenarios.
What was the impact of this sole-source award on the overall competitiveness and innovation within the Printed Circuit Assembly manufacturing sector for defense applications?
Sole-source awards, especially for significant amounts like $92.4 million, can disincentivize competition and innovation. When a large contract is awarded without competition, other companies may see less opportunity to enter the market or develop new capabilities, potentially leading to a less dynamic and more expensive supply chain for the Department of Defense in the long run.
Industry Classification
NAICS: Manufacturing › Semiconductor and Other Electronic Component Manufacturing › Printed Circuit Assembly (Electronic Assembly) Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp (UEI: 001381284)
Address: 128 LAKESIDE AVE, BURLINGTON, VT, 00
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $92,416,081
Exercised Options: $92,416,081
Current Obligation: $92,416,081
Contract Characteristics
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: M6785407D7000
IDV Type: IDC
Timeline
Start Date: 2007-07-30
Current End Date: 2009-06-30
Potential End Date: 2009-06-30 00:00:00
Last Modified: 2008-09-23
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