DoD Awards $37.7M for 172 Motorized Graders and Technical Assistance to Caterpillar Inc
Contract Overview
Contract Amount: $37,507,838 ($37.5M)
Contractor: Caterpillar Inc
Awarding Agency: Department of Defense
Start Date: 2011-08-12
End Date: 2016-12-31
Contract Duration: 1,968 days
Daily Burn Rate: $19.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Construction
Official Description: 1. THE PURPOSE OF DELIVERY ORDER 0021, TO CONTRACT W56HZV-08-D-0037, IS TO: A) ADD 172EA MOTORIZED GRADERS W/TYPE A KIT UNDER CLIN 0400AA, UNIT PRICE OF $218,926.79EA, TOTAL PRICE OF THE CLIN $37,655,407.88 B) ADD 10DA 'CONTRACTOR TECHNICAL ASSISTANCE - CONUS', UNIT PRICE OF $1,243.00, TOTAL PRICE OF THE CLIN $12,430.00
Place of Performance
Location: MOSSVILLE, PEORIA County, ILLINOIS, 61552
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $37.5 million to CATERPILLAR INC for work described as: 1. THE PURPOSE OF DELIVERY ORDER 0021, TO CONTRACT W56HZV-08-D-0037, IS TO: A) ADD 172EA MOTORIZED GRADERS W/TYPE A KIT UNDER CLIN 0400AA, UNIT PRICE OF $218,926.79EA, TOTAL PRICE OF THE CLIN $37,655,407.88 B) ADD 10DA 'CONTRACTOR TECHNICAL ASSISTANCE - CONUS', UNIT PRICE OF $1,… Key points: 1. Significant award for construction machinery, primarily for graders. 2. Caterpillar Inc. is the sole awardee for this delivery order. 3. Potential risk associated with single-source award for a large quantity. 4. Spending falls within the Construction Machinery Manufacturing sector.
Value Assessment
Rating: good
The unit price of $218,926.79 for motorized graders appears reasonable when benchmarked against similar heavy equipment procurements. The total CLIN price reflects the quantity ordered.
Cost Per Unit: $218,926.79
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, this specific delivery order is to a single contractor, Caterpillar Inc., which warrants scrutiny regarding price discovery for this particular order.
Taxpayer Impact: Taxpayers are likely receiving competitive pricing due to the initial full and open competition, but the specific pricing for this large order should be monitored.
Public Impact
Award supports essential construction and engineering capabilities for the Department of the Army. Procurement of specialized construction machinery impacts infrastructure development and maintenance. The long contract duration (2011-2016) suggests a sustained need for these assets.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Single awardee for a large quantity delivery order.
- Long contract duration may lead to price escalation risks.
Positive Signals
- Awarded under full and open competition.
- Supports critical military engineering needs.
Sector Analysis
This award falls under the Construction Machinery Manufacturing sector, specifically for heavy equipment like motorized graders. Benchmarks for similar large-scale equipment procurements by the DoD are typically in the tens of millions.
Small Business Impact
The data indicates this award was not set aside for small businesses, and the prime contractor, Caterpillar Inc., is a large corporation. There is no information provided on small business subcontracting.
Oversight & Accountability
The award is a delivery order against an existing contract, suggesting prior oversight. However, the specifics of the competition for this particular order and the justification for a single awardee should be reviewed.
Related Government Programs
- Construction Machinery Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Potential for price escalation due to long contract duration and economic price adjustment.
- Lack of transparency on competition for this specific delivery order.
- Reliance on a single contractor for a significant quantity of equipment.
Tags
construction-machinery-manufacturing, department-of-defense, il, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $37.5 million to CATERPILLAR INC. 1. THE PURPOSE OF DELIVERY ORDER 0021, TO CONTRACT W56HZV-08-D-0037, IS TO: A) ADD 172EA MOTORIZED GRADERS W/TYPE A KIT UNDER CLIN 0400AA, UNIT PRICE OF $218,926.79EA, TOTAL PRICE OF THE CLIN $37,655,407.88 B) ADD 10DA 'CONTRACTOR TECHNICAL ASSISTANCE - CONUS', UNIT PRICE OF $1,243.00, TOTAL PRICE OF THE CLIN $12,430.00
Who is the contractor on this award?
The obligated recipient is CATERPILLAR INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $37.5 million.
What is the period of performance?
Start: 2011-08-12. End: 2016-12-31.
What was the competitive landscape during the initial contract award (W56HZV-08-D-0037) that led to Caterpillar Inc. being the prime contractor?
The initial contract was awarded under full and open competition, indicating multiple bids were likely considered. However, the specific details of the bidding process, including the number of bidders and their proposals, are not provided in this data. Understanding the initial competitive environment is crucial for assessing the long-term value and potential risks associated with subsequent delivery orders.
Are there any identified risks associated with the long duration of this contract (nearly 5 years) and the potential for economic price adjustments?
A long contract duration, especially with economic price adjustments, can expose the government to increased costs due to market fluctuations in labor, materials, and fuel. While intended to protect contractors, it can lead to higher overall spending than initially projected. Regular monitoring and negotiation of price adjustments are critical to mitigate this risk.
How effectively does the unit price of $218,926.79 for motorized graders compare to current market prices for similar equipment, considering the award date?
The unit price of $218,926.79 was established in 2011. To assess current effectiveness, this price needs to be compared against contemporary market rates for comparable motorized graders, factoring in inflation and any technological advancements. Without current market data, it's difficult to definitively state its effectiveness in today's terms, though it was likely competitive at the time of award.
Industry Classification
NAICS: Manufacturing › Agriculture, Construction, and Mining Machinery Manufacturing › Construction Machinery Manufacturing
Product/Service Code: CONSTRUCT/MINE/EXCAVATE/HIGHWY EQPT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Parent Company: Caterpillar Inc. (UEI: 005070479)
Address: 14009 OLD GALENA RD TC-A, MOSSVILLE, IL, 61552
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $37,507,838
Exercised Options: $37,507,838
Current Obligation: $37,507,838
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W56HZV08D0037
IDV Type: IDC
Timeline
Start Date: 2011-08-12
Current End Date: 2016-12-31
Potential End Date: 2016-12-31 12:12:00
Last Modified: 2016-08-26
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