Altec Industries awarded $34.4M contract for heavy-duty trucks, impacting Alabama's manufacturing sector

Contract Overview

Contract Amount: $34,398,428 ($34.4M)

Contractor: Altec Industries, Inc.

Awarding Agency: General Services Administration

Start Date: 2010-03-26

End Date: 2010-11-21

Contract Duration: 240 days

Daily Burn Rate: $143.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 999

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: DESCR N.A.

Place of Performance

Location: BIRMINGHAM, SHELBY County, ALABAMA, 35242

State: Alabama Government Spending

Plain-Language Summary

General Services Administration obligated $34.4 million to ALTEC INDUSTRIES, INC. for work described as: DESCR N.A. Key points: 1. Contract value of $34.4M for heavy-duty trucks suggests significant investment in fleet modernization or expansion. 2. The fixed-price contract with economic price adjustment indicates potential for cost fluctuations based on market conditions. 3. Awarded to Altec Industries, Inc., this contract highlights the role of established manufacturers in government supply chains. 4. The contract duration of 240 days points to a focused delivery schedule for the specified heavy-duty trucks. 5. The North American Industry Classification System (NAICS) code 336120 confirms the focus on heavy-duty truck manufacturing. 6. The contract's geographic scope appears to be primarily within Alabama, as indicated by the state code 'AL'.

Value Assessment

Rating: good

The contract value of $34.4 million for heavy-duty trucks appears to be within a reasonable range for such specialized equipment. Benchmarking against similar government procurements for large truck fleets would provide a more precise value-for-money assessment. The fixed-price nature, with economic price adjustments, offers some cost certainty while acknowledging market volatility. Without specific details on the truck configurations and quantities, a definitive comparison is challenging, but the award to a known manufacturer suggests a competitive bid process likely yielded a fair market price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. This competitive environment is generally favorable for price discovery and ensuring the government receives the best value. The number of bidders is not specified, but the 'full and open' designation suggests a robust process. The use of a standard NAICS code for heavy-duty truck manufacturing implies a market with established players capable of competing for such contracts.

Taxpayer Impact: Full and open competition typically leads to more competitive pricing, which benefits taxpayers by reducing the overall cost of government acquisitions. It ensures that public funds are used efficiently by fostering a marketplace where contractors vie to offer the best combination of price and quality.

Public Impact

The primary beneficiaries are likely federal agencies requiring heavy-duty trucks for operational purposes, such as logistics, maintenance, or specialized services. The services delivered include the manufacturing and supply of heavy-duty trucks, crucial for government infrastructure and operational needs. The geographic impact is centered in Alabama, where Altec Industries, Inc. is based, potentially boosting local manufacturing employment and economic activity. Workforce implications may include job creation or sustained employment within Altec Industries and its supply chain, particularly in the heavy-duty truck manufacturing sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases due to economic price adjustment clause if market conditions fluctuate unfavorably.
Dependence on a single manufacturer, Altec Industries, Inc., could pose supply chain risks if production is disrupted.
The fixed-price nature, even with adjustments, might not fully insulate the government from unforeseen cost overruns on complex vehicle builds.

Positive Signals

Award to an established manufacturer, Altec Industries, Inc., suggests a track record of reliability and quality.
Full and open competition indicates a fair and transparent procurement process, likely resulting in competitive pricing.
The contract specifies heavy-duty trucks, implying a need for specialized, high-quality equipment essential for government operations.

Sector Analysis

The heavy-duty truck manufacturing sector is a specialized segment of the broader automotive industry, characterized by high production costs, complex engineering, and stringent safety standards. Government contracts for such vehicles are significant, often involving large dollar amounts due to the specialized nature and scale of the equipment. This contract fits within the broader category of industrial equipment procurement, where the General Services Administration (GSA) plays a key role in facilitating purchases for federal agencies. Comparable spending benchmarks would involve analyzing other large-scale vehicle procurements by defense, transportation, and civilian agencies.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' flag is also false, suggesting no specific small business subcontracting goals were mandated within this award. This means the primary contractor, Altec Industries, Inc., will likely fulfill the contract using its own resources or through its established supply chain, which may or may not involve significant subcontracting to small businesses. The impact on the small business ecosystem is therefore indirect, relying on Altec's general procurement practices.

Oversight & Accountability

Oversight for this contract would primarily fall under the General Services Administration (GSA), which awarded the contract through its Federal Acquisition Service. Accountability measures are embedded in the contract terms, including delivery schedules and specifications. Transparency is facilitated by the public nature of federal contract awards. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Federal Fleet Management
Vehicle Procurement
Heavy Equipment Acquisition
GSA Schedules Program
Industrial Manufacturing Contracts

Risk Flags

Potential for cost escalation due to Economic Price Adjustment (EPA) clause.
Supply chain dependency on a single manufacturer.
Need for detailed performance monitoring to ensure delivery and quality standards are met.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $34.4 million to ALTEC INDUSTRIES, INC.. DESCR N.A.

Who is the contractor on this award?

The obligated recipient is ALTEC INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $34.4 million.

What is the period of performance?

Start: 2010-03-26. End: 2010-11-21.

What is Altec Industries, Inc.'s track record with federal contracts, particularly for heavy-duty vehicles?

Altec Industries, Inc. has a history of securing federal contracts, often related to specialized vehicles and equipment. While this specific award of $34.4 million for heavy-duty trucks is substantial, their broader portfolio likely includes similar procurements. Analyzing past performance data, including contract completion rates, any past performance issues, and the types of vehicles previously supplied to government entities, would provide a clearer picture of their reliability. Federal procurement databases and contract award histories can offer insights into their experience and success in meeting government requirements. Their specialization in utility and specialty vehicles suggests a strong capability in meeting demanding specifications.

How does the $34.4 million contract value compare to similar government procurements for heavy-duty trucks?

The $34.4 million contract value for heavy-duty trucks is significant and suggests a substantial acquisition, potentially for a large fleet or highly specialized vehicles. To benchmark this value, one would compare it against recent awards for similar truck types (e.g., dump trucks, specialized utility trucks, large transport vehicles) made by agencies like the Department of Defense, Department of Transportation, or other GSA procurements. Factors such as the number of units, specific configurations, technological features, and warranty terms heavily influence price. Without these specifics, a direct comparison is difficult, but the amount indicates a major investment in essential government equipment, likely reflecting market rates for high-capacity, durable vehicles.

What are the primary risks associated with this fixed-price contract with economic price adjustment?

The primary risks associated with this fixed-price contract with economic price adjustment (FPEPA) involve potential cost escalations for the government. While the fixed-price component provides a baseline cost, the economic price adjustment (EPA) clause allows for modifications based on fluctuations in specified economic factors, such as raw material costs (steel, aluminum), labor rates, or fuel prices. If these costs rise significantly during the contract period, the final price paid by the government could exceed initial projections. Conversely, if costs decrease, the EPA could lead to a lower price. The risk lies in the unpredictability of these economic factors and the potential for the EPA to increase the overall expenditure beyond what might have been achieved with a firm fixed price.

What is the expected program effectiveness and impact of acquiring these heavy-duty trucks?

The acquisition of heavy-duty trucks under this contract is expected to enhance the operational capabilities of the procuring federal agencies. These vehicles are typically essential for infrastructure maintenance, construction, emergency response, logistics, and other critical government functions. Improved fleet capacity or modernization can lead to increased efficiency, reduced downtime, and the ability to undertake more demanding projects. The effectiveness will be measured by the reliability of the trucks, their suitability for the intended tasks, and the extent to which they support the agency's mission objectives. Successful delivery and performance of the trucks should directly contribute to the agency's ability to fulfill its public service mandate.

How has federal spending on heavy-duty trucks evolved over the past five years?

Federal spending on heavy-duty trucks has likely remained a consistent, albeit specialized, component of overall government procurement. Trends may show increased demand for vehicles equipped with advanced technologies, such as improved fuel efficiency, emissions controls, and safety features, driven by regulatory requirements and sustainability goals. The total dollar amount spent can fluctuate based on major fleet replacement cycles, infrastructure initiatives, or specific agency needs (e.g., disaster relief, defense logistics). Analyzing historical data from sources like USAspending.gov, filtered by relevant NAICS codes (like 336120) and contract types, would reveal specific spending patterns, average contract values, and the primary agencies involved in acquiring these types of vehicles.

Industry Classification

NAICS: Manufacturing › Motor Vehicle Manufacturing › Heavy Duty Truck Manufacturing

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 999

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Parent Company: Altec Inc (UEI: 086694861)

Address: 210 INVERNESS CENTER DR, BIRMINGHAM, AL, 35242

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $34,398,428

Exercised Options: $34,398,428

Current Obligation: $34,398,428

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS30F1028G

IDV Type: FSS

Timeline