DoD awards $122M contract for Ammunition Manufacturing to Textron Systems Corp

Contract Overview

Contract Amount: $122,297,437 ($122.3M)

Contractor: Textron Systems Corp

Awarding Agency: Department of Defense

Start Date: 2004-12-16

End Date: 2007-12-31

Contract Duration: 1,110 days

Daily Burn Rate: $110.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Place of Performance

Location: WILMINGTON, MIDDLESEX County, MASSACHUSETTS, 01887

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $122.3 million to TEXTRON SYSTEMS CORP for work described as: Key points: 1. Contract awarded to a single, established defense contractor. 2. Significant value suggests a critical need for ammunition. 3. Long duration indicates a sustained requirement. 4. Lack of competition raises questions about price discovery.

Value Assessment

Rating: fair

The contract value of $122M over three years is substantial. Without competitive bids, it's difficult to assess if this represents a fair market price for ammunition manufacturing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers.

Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for these ammunition manufacturing services.

Public Impact

Ensures continued supply of essential ammunition for defense operations. Supports a major defense contractor and its workforce. Potential for higher costs due to sole-source award.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition.
Long contract duration.
No small business participation noted.

Positive Signals

Ensures critical supply chain continuity.
Award to established contractor with proven capabilities.

Sector Analysis

This contract falls within the defense manufacturing sector, specifically ammunition production. Spending in this area is driven by military readiness requirements and geopolitical factors.

Small Business Impact

The data indicates no specific set-aside for small businesses. This contract was awarded to Textron Systems Corp., a large defense contractor, suggesting limited direct impact on small businesses.

Oversight & Accountability

The contract was managed by the Defense Contract Management Agency. Oversight would focus on performance, quality, and adherence to contract terms, especially given the sole-source nature.

Related Government Programs

Ammunition (except Small Arms) Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source award
Lack of competition
No small business participation
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $122.3 million to TEXTRON SYSTEMS CORP. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is TEXTRON SYSTEMS CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $122.3 million.

What is the period of performance?

Start: 2004-12-16. End: 2007-12-31.

What was the justification for the sole-source award, and what steps were taken to ensure a fair price?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without specific documentation, it's presumed the agency determined Textron Systems Corp. was the only capable source. However, the absence of competition makes price validation challenging, and further review would be needed to confirm if market research or negotiation strategies were employed to mitigate potential overpricing.

What are the risks associated with a sole-source contract for ammunition manufacturing?

The primary risk of a sole-source contract is the potential for inflated prices due to the lack of competitive pressure. Additionally, it can stifle innovation from other potential suppliers and create a dependency on a single provider, which could be problematic if that provider faces production issues or goes out of business. Ensuring quality and timely delivery also relies heavily on the contractor's internal processes.

How does this contract contribute to the overall effectiveness of defense operations?

This contract ensures the continuous availability of a critical component for defense operations: ammunition. By securing a supply from an established manufacturer like Textron Systems Corp., the Department of Defense can maintain readiness and operational capability. The long duration suggests a sustained need, highlighting the importance of this supply chain for ongoing military activities and national security.

Industry Classification

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

Product/Service Code: WEAPONS

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

Address: 201 LOWELL STREET, WILMINGTON, MA, 06

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $609,228,689

Exercised Options: $609,228,689

Current Obligation: $122,297,437

Contract Characteristics

Cost or Pricing Data: YES

Timeline