DoD's $640M contract for UCA for CBU 105 ammunition awarded to Textron Systems Corporation

Contract Overview

Contract Amount: $640,786,442 ($640.8M)

Contractor: Textron Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2012-06-28

End Date: 2015-12-31

Contract Duration: 1,281 days

Daily Burn Rate: $500.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: UCA FOR CBU 105

Place of Performance

Location: WILMINGTON, MIDDLESEX County, MASSACHUSETTS, 01887

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $640.8 million to TEXTRON SYSTEMS CORPORATION for work described as: UCA FOR CBU 105 Key points: 1. The contract value of $640.79 million represents a significant investment in specialized munitions. 2. Awarded as 'Not Available for Competition', this suggests a lack of alternative suppliers or unique capabilities. 3. The firm-fixed-price contract type aims to control costs by setting a predetermined price. 4. The duration of 1281 days indicates a long-term need for these munitions. 5. The contract falls under the Ammunition (except Small Arms) Manufacturing sector, highlighting defense industrial base capabilities. 6. The award to Textron Systems Corporation, a known defense contractor, suggests reliance on established expertise.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without detailed cost breakdowns or comparisons to similar sole-source procurements. The firm-fixed-price structure is a positive indicator for cost control. However, the lack of competition inherently limits price discovery and potential savings for taxpayers. Without access to cost data or competitive bids, a definitive value-for-money assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a 'Not Available for Competition' (NAF) justification, indicating that only one responsible source was determined to be capable of meeting the government's needs. This typically occurs when a product is proprietary, requires unique manufacturing capabilities, or there's an urgent need that cannot be met through competitive bidding. The lack of competition means that price discovery mechanisms, such as multiple bids, were not utilized.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as there is no competitive pressure to drive down costs. This limits the government's ability to secure the best possible value.

Public Impact

The primary beneficiaries are the Department of Defense, specifically the Air Force, ensuring readiness and operational capabilities. The services delivered involve the manufacturing and supply of specialized munitions (UCA for CBU 105). The geographic impact is primarily within the United States, focusing on Textron Systems Corporation's manufacturing facilities. Workforce implications include employment at Textron Systems Corporation and its supply chain partners within the defense manufacturing sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced value for taxpayer funds.
Limited transparency inherent in sole-source awards makes it difficult to fully assess cost-effectiveness.
Dependence on a single contractor can create supply chain risks if the contractor faces production issues.

Positive Signals

Firm-fixed-price contract type helps to establish cost certainty for the government.
Award to an established defense contractor like Textron Systems Corporation suggests a reliance on proven capabilities and quality.
The long contract duration indicates a sustained and critical need for the specified munitions.

Sector Analysis

This contract falls within the defense sector, specifically focusing on ammunition manufacturing. The market for specialized munitions is often characterized by high barriers to entry due to complex technology, stringent quality requirements, and significant capital investment. Such contracts are typically awarded to a limited number of defense industrial base companies with the requisite expertise and security clearances. The total addressable market for such specialized munitions is driven by defense spending priorities and geopolitical factors.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business subcontracting) is also false. This suggests that the prime contractor, Textron Systems Corporation, is not obligated to meet specific small business subcontracting goals for this particular award. Consequently, the direct impact on the small business ecosystem for this contract is likely minimal, although the prime contractor may still engage small businesses in its broader supply chain.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Air Force contracting and program management offices. Accountability measures are embedded in the contract terms, including delivery schedules, quality standards, and payment milestones. Transparency is limited due to the sole-source nature of the award. Inspector General (IG) jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Department of Defense Ammunition Procurement
Air Force Munitions Contracts
Defense Industrial Base Manufacturing
Specialized Munitions Development
Textron Systems Corporation Contracts

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for cost overruns
Supply chain dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $640.8 million to TEXTRON SYSTEMS CORPORATION. UCA FOR CBU 105

Who is the contractor on this award?

The obligated recipient is TEXTRON SYSTEMS CORPORATION.

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 $640.8 million.

What is the period of performance?

Start: 2012-06-28. End: 2015-12-31.

What is the historical spending pattern for UCA for CBU 105 ammunition by the Department of Defense?

Analyzing historical spending for this specific munition requires access to detailed procurement databases. However, general trends in defense spending on ammunition indicate significant, albeit fluctuating, investments driven by operational needs and modernization programs. Contracts for specialized munitions like the UCA for CBU 105 are often awarded on a sole-source or limited-competition basis due to the unique technological requirements and the specialized manufacturing capabilities of a few prime contractors. The total amount awarded in this contract ($640.79 million) suggests a substantial and sustained requirement over its duration. Without specific historical data for this exact item, it's difficult to pinpoint precise spending patterns, but it aligns with the typical procurement profile for advanced ordnance within the DoD.

How does the per-unit cost of the UCA for CBU 105 compare to similar munitions, considering this is a sole-source contract?

Determining the per-unit cost for this sole-source contract is not possible with the provided data, as only the total award amount and duration are available. Sole-source contracts inherently limit price discovery, making direct comparisons to competitively procured similar munitions challenging. Typically, competitive bidding drives down prices. In the absence of competitive benchmarks, the government relies on cost realism analyses and negotiation to ensure fair pricing. However, without access to the contractor's cost breakdown or data on comparable munitions procured through competition, it is difficult to definitively assess if the per-unit cost represents good value for money. The firm-fixed-price structure aims to provide cost certainty, but the lack of competition is a significant factor in value assessment.

What are the specific risks associated with a sole-source award for critical defense munitions like the UCA for CBU 105?

The primary risk associated with a sole-source award for critical defense munitions is the potential for inflated pricing due to the absence of competitive pressure. This can lead to reduced value for taxpayer dollars. Another significant risk is supply chain vulnerability; reliance on a single contractor can create dependencies that are problematic if the contractor experiences production delays, quality issues, or financial instability. Furthermore, a lack of competition can stifle innovation, as there is less incentive for the sole provider to invest in process improvements or alternative technologies. Ensuring robust oversight, including thorough cost realism analyses and performance monitoring, becomes crucial to mitigate these inherent risks.

What is Textron Systems Corporation's track record with similar defense contracts, particularly in ammunition manufacturing?

Textron Systems Corporation has a well-established track record in the defense industry, including significant experience in the development and manufacturing of munitions and related systems. They are known for producing a range of advanced weapon systems and components. Their involvement in contracts for specialized munitions, such as the UCA for CBU 105, aligns with their core capabilities. While specific details of past performance on similar contracts would require deeper database analysis, Textron's position as a prime contractor for substantial defense awards suggests a history of meeting government requirements for quality, delivery, and technical performance. Their expertise in this domain is a key factor in their selection for sole-source or limited-competition awards.

How does the $640.79 million contract value compare to the overall defense spending on ammunition (except small arms) manufacturing?

The $640.79 million awarded to Textron Systems Corporation for UCA for CBU 105 ammunition represents a substantial single contract within the 'Ammunition (except Small Arms) Manufacturing' (NAICS 332993) category. Total defense spending on this category can fluctuate annually but often runs into billions of dollars, encompassing a wide array of munitions from artillery shells to complex guided missiles. This specific contract, while large, is likely a significant portion of the budget allocated for this particular type of munition rather than the entirety of the DoD's ammunition spending. Its sole-source nature indicates a specific, perhaps niche or technologically advanced, requirement that isn't met by broader competitive procurements.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Textron Inc (UEI: 001338979)

Address: 201 LOWELL ST, WILMINGTON, MA, 06

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: $640,786,442

Exercised Options: $640,786,442

Current Obligation: $640,786,442

Contract Characteristics

Cost or Pricing Data: NO

Timeline