DoD's $1.1B electronics and communication equipment contract awarded to General Dynamics Mission Systems, Inc. for R&D
Contract Overview
Contract Amount: $109,537,480 ($109.5M)
Contractor: General Dynamics Mission Systems, Inc.
Awarding Agency: Department of Defense
Start Date: 2001-09-29
End Date: 2011-12-31
Contract Duration: 3,745 days
Daily Burn Rate: $29.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: 200112!000154!5700!GV40 !ESC/IYK !F1962801C0047 !A!N!*!N! !20010929!20011231!883234924!883234924!837980291!N!VERIDIAN SYSTEMS DIVISION, INC!1975 GREEN ROAD !ANN ARBOR !MI!48105!03020!161!26!ANN ARBOR !WASHTENAW !MICHIGAN !+000003273648!N!N!000000000000!AC65!RDTE/ELECTRONICS & COMMUNICATION EQ-ENG/MANUF DEV !A7 !ELECTRONICS AND COMMUNICATION !3000!NOT DISCERNABLE OR CLASSIFIED !541511!*!*!3!C!S! !*!*!*!B!*!*!A! !A !U!R!2!003!B! !Z!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001!
Place of Performance
Location: OAKTON, FAIRFAX County, VIRGINIA, 22124
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $109.5 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: 200112!000154!5700!GV40 !ESC/IYK !F1962801C0047 !A!N!*!N! !20010929!20011231!883234924!883234924!837980291!N!VERIDIAN SYSTEMS DIVISION, INC!1975 GREEN ROAD !ANN ARBOR !MI!48105!03020!161!26!ANN ARBOR !WASHT… Key points: 1. Contract value of $1.1 billion over its life, with significant R&D focus. 2. Awarded through full and open competition, indicating a competitive bidding process. 3. Contract type is 'Cost Plus Award Fee', which incentivizes performance but carries cost risk. 4. The contract duration of over 9 years suggests a long-term need for these services. 5. The primary NAICS code (541511) points to custom computer programming services, a key area in defense tech. 6. The contractor, General Dynamics Mission Systems, is a major player in the defense sector.
Value Assessment
Rating: fair
The contract's total value of $1.1 billion over nearly a decade is substantial. While the specific performance metrics and award fee structure are not detailed here, 'Cost Plus Award Fee' contracts can sometimes lead to higher costs than fixed-price contracts if not managed carefully. Benchmarking this against similar R&D contracts for electronics and communication equipment would be necessary for a definitive value assessment. However, the competitive award process suggests an attempt to secure reasonable pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under 'full and open competition', suggesting that all responsible sources were permitted to submit a bid. The presence of 3 bids indicates a moderate level of competition for this significant defense contract. A higher number of bidders might have been expected for a contract of this magnitude, but three competitive offers still provide a basis for price discovery and selection.
Taxpayer Impact: The full and open competition, despite having 3 bidders, likely resulted in a more competitive price than a sole-source award. This benefits taxpayers by ensuring the government explored multiple options before awarding the contract.
Public Impact
The primary beneficiary is the Department of Defense, which receives advanced electronics and communication equipment. Services delivered likely include research, development, manufacturing, and integration of sophisticated systems. The geographic impact is primarily within the United States, supporting defense readiness. Workforce implications include employment for engineers, technicians, and support staff at General Dynamics and its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee contracts can lead to cost overruns if not rigorously managed.
- Long contract duration (over 9 years) may present risks related to technological obsolescence or changing requirements.
- The specific nature of R&D can be unpredictable, making it difficult to forecast final costs and outcomes.
- Reliance on a single large contractor for critical defense technology warrants close monitoring.
Positive Signals
- Awarded through full and open competition, suggesting a competitive process.
- General Dynamics Mission Systems is an established defense contractor with a track record.
- The contract focuses on R&D, which is crucial for maintaining technological superiority.
- The award fee structure incentivizes contractor performance, potentially leading to better outcomes.
Sector Analysis
This contract falls within the Defense sector, specifically focusing on electronics and communication equipment, which is a critical component of modern military operations. The market for defense electronics is characterized by high R&D investment, long product cycles, and significant government spending. Comparable spending benchmarks would involve looking at other large-scale R&D and manufacturing contracts for similar defense systems, often in the hundreds of millions to billions of dollars.
Small Business Impact
There is no indication from the provided data that this contract included a small business set-aside. Given the large value and specialized nature of the work, it is likely that General Dynamics Mission Systems would be the prime contractor, potentially utilizing subcontractors. The impact on the small business ecosystem would depend on the subcontracting opportunities offered by the prime contractor.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures are embedded in the 'Cost Plus Award Fee' structure, incentivizing performance. Transparency is generally limited for defense contracts due to national security considerations, but contract awards and basic details are publicly available.
Related Government Programs
- Defense Electronics R&D
- Communication Systems Procurement
- Advanced Technology Development
- Military Equipment Manufacturing
- Information Technology Services for Defense
Risk Flags
- Cost Overrun Risk (CPAF)
- Technological Obsolescence
- Evolving Requirements
- Long-Term Contract Management Challenges
Tags
defense, department-of-defense, general-dynamics-mission-systems, cost-plus-award-fee, definitive-contract, full-and-open-competition, rdte, electronics, communication-equipment, custom-computer-programming, ann-arbor, michigan
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $109.5 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. 200112!000154!5700!GV40 !ESC/IYK !F1962801C0047 !A!N!*!N! !20010929!20011231!883234924!883234924!837980291!N!VERIDIAN SYSTEMS DIVISION, INC!1975 GREEN ROAD !ANN ARBOR !MI!48105!03020!161!26!ANN ARBOR !WASHTENAW !MICHIGAN !+000003273648!N!N!000000000000!AC65!RDTE/ELECTRONICS & COMMUNICATION EQ-ENG/MANUF DEV !A7 !ELECTRONICS AND COMMUNICATION !3000!NOT DISCERNABLE OR CLASSIFIED !541511!*!*!3!C!S! !*!*!*!B!*!*!A!
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS MISSION SYSTEMS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $109.5 million.
What is the period of performance?
Start: 2001-09-29. End: 2011-12-31.
What is the specific breakdown of the $1.1 billion award across different phases or types of work (e.g., R&D, production, sustainment)?
The provided data indicates the contract is primarily for 'RDTE/ELECTRONICS & COMMUNICATION EQ-ENG/MANUF DEV' (Research, Development, Test, and Evaluation / Electronics & Communication Equipment - Engineering/Manufacturing Development). The total award value is $1,095,374,80.05. While the data doesn't break down the spending across specific phases or work types within this broad category, the 'RDTE' designation suggests a significant portion is allocated to research and development activities. The 'MANUF DEV' part implies development leading into potential manufacturing. Without more granular contract line item details, it's difficult to provide a precise split, but the emphasis is clearly on the developmental stages of electronics and communication equipment.
How does the 'Cost Plus Award Fee' (CPAF) structure typically impact final costs compared to other contract types for similar R&D projects?
Cost Plus Award Fee (CPAF) contracts reimburse the contractor for allowable costs incurred, plus a base fee, and an award fee that is earned based on meeting or exceeding specific performance objectives. For R&D projects, CPAF can be beneficial when the scope is not fully defined or when innovation is paramount, as it allows flexibility. However, compared to fixed-price contracts, CPAF generally carries a higher risk of cost growth because the final price is not predetermined. The 'award fee' component incentivizes performance, which can lead to better outcomes, but the government pays for both the costs and the potential for high performance. Rigorous oversight is crucial to manage costs effectively under CPAF.
What is General Dynamics Mission Systems' track record with similar large-scale defense R&D contracts?
General Dynamics Mission Systems (GDMS), a subsidiary of General Dynamics, has a substantial track record in developing and delivering complex systems for defense and intelligence agencies. They are known for work in areas such as command and control, cybersecurity, signals intelligence, and platform integration. GDMS has been a prime contractor on numerous large, multi-year defense contracts, often involving advanced electronics, communications, and computing technologies. Their history includes successful delivery of mission-critical systems, though like any major defense contractor, they have also been involved in contracts that faced scrutiny or challenges. Their established presence and capabilities make them a frequent recipient of significant R&D and production contracts within the defense sector.
What are the potential risks associated with a contract duration of over 9 years for electronics and communication equipment?
A contract duration of over 9 years for electronics and communication equipment presents several potential risks. Firstly, technological obsolescence is a significant concern; the pace of innovation in electronics and communication can render systems outdated long before the contract ends. Secondly, requirements may evolve significantly over such a long period due to changes in military strategy, geopolitical landscapes, or emerging threats, potentially making the original system specifications less relevant. Thirdly, long-term contracts can sometimes lead to complacency or reduced urgency from the contractor if not managed with active oversight. Finally, economic uncertainties or shifts in government funding priorities over nearly a decade could impact the contract's stability or scope.
How does the NAICS code 541511 (Custom Computer Programming Services) align with the broader 'Electronics & Communication Equipment' focus of the contract?
The NAICS code 541511, 'Custom Computer Programming Services,' aligns with the contract's focus on 'Electronics & Communication Equipment - Engineering/Manufacturing Development' by recognizing the integral role of software and custom programming in modern electronic and communication systems. Today's advanced hardware is heavily reliant on sophisticated software for its functionality, control, and communication capabilities. This includes developing operating systems, firmware, embedded software, network protocols, and user interfaces that are specific to the custom-designed hardware. Therefore, a contract for developing advanced communication equipment would inherently involve extensive custom computer programming to ensure the hardware performs as intended and integrates seamlessly into larger systems.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp
Address: 10467 WHITE GRANITE DR STE 304, OAKTON, VA, 22124
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2001-09-29
Current End Date: 2011-12-31
Potential End Date: 2011-12-31 00:00:00
Last Modified: 2025-04-25
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