DoD's $124M Ammunition Contract with Textron Systems Corporation Lacked Competition

Contract Overview

Contract Amount: $124,024,599 ($124.0M)

Contractor: Textron Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2006-01-20

End Date: 2008-12-19

Contract Duration: 1,064 days

Daily Burn Rate: $116.6K/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 $124.0 million to TEXTRON SYSTEMS CORPORATION for work described as: Key points: 1. Significant spending on ammunition manufacturing. 2. Sole-source award raises questions about price discovery. 3. Long contract duration (1064 days) may indicate complex needs or limited options. 4. Textron Systems Corporation is a major defense contractor.

Value Assessment

Rating: questionable

The contract value of $124M for ammunition manufacturing is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar contracts for ammunition (NAICS 332993).

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no market pressure to offer the best price.

Taxpayer Impact: The lack of competition likely resulted in a higher price than could have been achieved through a competitive process, impacting taxpayer funds.

Public Impact

Taxpayers may have overpaid due to the absence of competitive bidding. The Department of Defense secured a critical supply of ammunition. Potential for reduced innovation if market competition is stifled.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for overpayment
Long contract duration

Positive Signals

Secured essential ammunition supply

Sector Analysis

This contract falls under the manufacturing sector, specifically ammunition production. Defense spending on such goods is crucial for national security, but competitive procurement is vital to ensure cost-effectiveness.

Small Business Impact

The data indicates this contract was not awarded to small businesses, as Textron Systems Corporation is a large defense contractor. There is no indication of subcontracting opportunities for small businesses within this award.

Oversight & Accountability

The 'NOT COMPETED' status suggests a waiver of standard competitive procedures. Further review would be needed to understand the justification for this sole-source award and ensure appropriate oversight was applied.

Related Government Programs

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

Risk Flags

Lack of competition
Potential for inflated pricing
Limited transparency in award justification
No small business participation evident

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $124.0 million to TEXTRON SYSTEMS CORPORATION. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is TEXTRON SYSTEMS CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $124.0 million.

What is the period of performance?

Start: 2006-01-20. End: 2008-12-19.

What was the specific justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?

The justification for a sole-source award typically involves factors like urgency, unique capabilities, or lack of viable alternatives. Without detailed documentation, it's impossible to confirm the specific reasons. Agencies are expected to exhaust competitive options before resorting to sole-source procurement to ensure best value and taxpayer protection.

How does the unit cost of this ammunition compare to industry benchmarks or historical pricing for similar items, considering the lack of competition?

Assessing the unit cost is challenging without a competitive benchmark. A sole-source award inherently bypasses the price discovery mechanism of competition. To evaluate value, a thorough cost analysis comparing Textron's pricing to independent estimates, historical data from competitive contracts, or prices paid by other government agencies for comparable items would be necessary.

What measures were in place to ensure accountability and performance given the sole-source nature of the contract?

Even in sole-source contracts, accountability is maintained through contract clauses, performance metrics, and oversight. The Defense Contract Management Agency (DCMA) likely monitored Textron's performance against the contract terms, including quality, delivery schedules, and adherence to the firm-fixed-price structure. However, the absence of competition limits leverage for price negotiation.

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

Parent Company: Textron Inc (UEI: 001338979)

Address: 201 LOWELL ST, WILMINGTON, MA, 06

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

Contract Characteristics

Cost or Pricing Data: YES

Timeline