Navy awards $280.7M for shipbuilding and repair, with a significant portion for troop transport vessels

Contract Overview

Contract Amount: $280,685,359 ($280.7M)

Contractor: Marinette Marine Corporation

Awarding Agency: Department of Defense

Start Date: 2003-07-13

End Date: 2011-12-31

Contract Duration: 3,093 days

Daily Burn Rate: $90.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200504!089435!1700!N00025!NAVAL FACILITIES ENGINEERING COM!N0002503C0002 !A!N! !N! !P00011!20040713!20050117!006135388!006135388!006073183!N!MARINETTE MARINE CORPORATION !1600 ELY ST !MARINETTE !WI!54143!49300!075!55!MARINETTE !MARINETTE !WISCONSIN !+000000630953!N!N!000000000000!1910!TRANSPORT VESSELS, PASSENGER AND TROOP !A3 !SHIPS !000 !* !336611!A!A!3!A!S!D! ! !20200930!B! ! !A! !D!U!J!1!001!N!1B!A!N!Z! ! !N!C!N! ! ! !Z!Z!A!A!000!A!B!N! ! ! !Y!1725!N00025!0001! !

Place of Performance

Location: MARINETTE, MARINETTE County, WISCONSIN, 54143

State: Wisconsin Government Spending

Plain-Language Summary

Department of Defense obligated $280.7 million to MARINETTE MARINE CORPORATION for work described as: 200504!089435!1700!N00025!NAVAL FACILITIES ENGINEERING COM!N0002503C0002 !A!N! !N! !P00011!20040713!20050117!006135388!006135388!006073183!N!MARINETTE MARINE CORPORATION !1600 ELY ST !MARINETTE !WI!54143!49300!075!55!MARINETTE !MARI… Key points: 1. Contract awarded to Marinette Marine Corporation for shipbuilding and repair services. 2. Significant portion of the contract value allocated to troop and passenger transport vessels. 3. Contract duration spans over 8 years, indicating a long-term need for these services. 4. The contract was competed under 'full and open competition after exclusion of sources', suggesting a specific but competitive process. 5. The award value represents a substantial investment in naval fleet capabilities. 6. Geographic location of the contractor in Wisconsin may have local economic implications.

Value Assessment

Rating: good

The contract value of $280.7 million over approximately 8 years suggests a substantial investment in naval shipbuilding and repair. Benchmarking this against similar contracts for troop transport vessels would provide a clearer picture of value for money. However, the duration and scope indicate a significant commitment by the Navy. Without specific per-unit cost data for the vessels or repair services, a precise value-for-money assessment is challenging, but the competitive nature of the award is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition after exclusion of sources'. This indicates that while the competition was open, there were specific criteria or exclusions applied, which is not uncommon in specialized defense contracting. The exact number of bidders is not specified, but the 'full and open' designation suggests multiple entities had the opportunity to compete, which generally promotes price discovery and potentially better pricing for the government.

Taxpayer Impact: A competitive bidding process, even with exclusions, is generally beneficial for taxpayers as it encourages multiple companies to offer their best prices and capabilities, leading to more efficient use of public funds.

Public Impact

The primary beneficiaries are the U.S. Navy, which receives essential fleet support and new vessel construction. Services delivered include the construction and repair of naval vessels, specifically troop and passenger transport types. The geographic impact is primarily centered around the contractor's location in Marinette, Wisconsin, potentially creating or sustaining jobs in that region. Workforce implications include employment opportunities for skilled labor in shipbuilding and repair within the contractor's facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns in long-term shipbuilding contracts if not managed tightly.
Dependence on a single contractor for a significant portion of naval vessel needs could pose supply chain risks.
The 'exclusion of sources' in the competition, while potentially justified, warrants scrutiny to ensure it did not unduly limit competition.

Positive Signals

Award to an established entity like Marinette Marine Corporation suggests a level of confidence in their capabilities.
The long contract duration indicates a stable, predictable demand, allowing for efficient resource planning by the contractor.
The firm fixed-price nature of the contract (implied by 'pt': 'FIRM FIXED PRICE') shifts some financial risk to the contractor.

Sector Analysis

This contract falls within the shipbuilding and repair sector, a critical component of national defense and maritime infrastructure. The market is characterized by high barriers to entry due to specialized facilities, skilled labor requirements, and significant capital investment. The value of this contract, over $280 million, is substantial and reflects the complexity and scale of naval vessel construction and maintenance. Comparable spending benchmarks would typically involve analyzing other large naval shipbuilding contracts awarded by the Department of Defense.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, the primary impact on small businesses would be through potential subcontracting opportunities. Marinette Marine Corporation, as the prime contractor, may engage small businesses for specialized components, materials, or services, contributing to the broader small business ecosystem within the defense industrial base.

Oversight & Accountability

Oversight for this contract would likely be managed by the Defense Contract Management Agency (DCMA), as indicated by 'sa': 'Defense Contract Management Agency'. They are responsible for ensuring contract compliance, quality assurance, and timely delivery. Accountability measures are built into the contract terms, including performance standards and payment schedules. Transparency is facilitated through contract databases like FPDS, where this award is recorded.

Related Government Programs

Naval Shipbuilding Programs
Afloat Battle Ships
Amphibious Assault Ships
Fleet Replenishment Ships
Ship Maintenance and Repair Contracts

Risk Flags

Long contract duration increases exposure to market volatility and technological obsolescence.
Potential for cost overruns if not managed effectively, despite fixed-price nature.
Dependence on a single prime contractor for critical naval assets.
Competition level, while 'full and open', had exclusions, requiring scrutiny.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $280.7 million to MARINETTE MARINE CORPORATION. 200504!089435!1700!N00025!NAVAL FACILITIES ENGINEERING COM!N0002503C0002 !A!N! !N! !P00011!20040713!20050117!006135388!006135388!006073183!N!MARINETTE MARINE CORPORATION !1600 ELY ST !MARINETTE !WI!54143!49300!075!55!MARINETTE !MARINETTE !WISCONSIN !+000000630953!N!N!000000000000!1910!TRANSPORT VESSELS, PASSENGER AND TROOP !A3 !SHIPS !000 !* !336611!A!A!3!A!S!D! ! !202

Who is the contractor on this award?

The obligated recipient is MARINETTE MARINE 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 $280.7 million.

What is the period of performance?

Start: 2003-07-13. End: 2011-12-31.

What is the historical spending trend for shipbuilding and repair contracts awarded by the Department of Defense to Marinette Marine Corporation?

Analyzing historical spending data for Marinette Marine Corporation reveals a pattern of significant contract awards from the Department of Defense, particularly for shipbuilding and repair. Prior to this $280.7 million award, the company has secured substantial funding for various naval projects. For instance, looking at data from the past decade, Marinette Marine has been a recipient of contracts related to the construction of Littoral Combat Ships (LCS) and other specialized vessels. The total value of contracts awarded to the company fluctuates annually based on program needs and appropriations, but consistently places them as a key player in naval shipbuilding. This $280.7 million award represents a significant single contract, but it aligns with their established role and capacity within the defense industrial base. Further analysis would involve comparing the cumulative value of contracts over time to assess the consistency and scale of their involvement.

How does the per-unit cost of troop transport vessels under this contract compare to similar vessels procured by other military branches or allied nations?

A direct per-unit cost comparison for troop transport vessels under this contract is challenging without specific details on the vessel class, size, and capabilities being procured. The contract data identifies the National Item Identification Number (NIIN) as '336611' and the Product Service Code (PSC) as '1910' (TRANSPORT VESSELS, PASSENGER AND TROOP), but does not break down the cost per vessel. Generally, naval vessel construction costs are highly variable, influenced by design complexity, materials, technology integration, and labor costs. To benchmark effectively, one would need to identify comparable vessels procured by, for example, the U.S. Army Corps of Engineers, the U.S. Coast Guard, or international navies. Such a comparison would require access to detailed procurement data for similar vessels, factoring in inflation and differences in specifications. Given the specialized nature of military shipbuilding, direct comparisons can be difficult, but a broad analysis of similar large transport vessel contracts could provide a range for evaluation.

What are the key performance indicators (KPIs) and performance risks associated with this shipbuilding contract?

Key performance indicators (KPIs) for a shipbuilding contract of this nature typically include adherence to delivery schedules, meeting stringent quality and safety standards, compliance with technical specifications, and managing costs within the firm fixed-price structure. Performance risks are inherent in large-scale shipbuilding projects. These can include design challenges, supply chain disruptions for critical components, labor shortages or disputes, unforeseen technical issues during construction or testing, and potential cost increases for raw materials. The long duration of the contract (over 8 years) amplifies these risks, as market conditions and technological requirements can change. The Navy's oversight, likely through the DCMA, aims to mitigate these risks through regular inspections, progress reviews, and proactive issue resolution. The contractor's track record in managing similar complex projects is a crucial factor in assessing their ability to meet performance expectations.

What is the contractor's track record with the Department of Defense, specifically regarding shipbuilding and repair contracts?

Marinette Marine Corporation has a well-established track record with the Department of Defense, particularly in the realm of shipbuilding and repair. They have been a significant participant in various naval programs, including the construction of Littoral Combat Ships (LCS) and other specialized vessels. Their history includes delivering complex platforms that meet demanding military specifications. While specific performance metrics for past contracts are not detailed here, their continued selection for major shipbuilding initiatives suggests a generally positive performance history and capability. However, like any large defense contractor, they may have faced challenges or criticisms on specific projects, which would be detailed in performance reviews and contract close-out reports. Their longevity and continued awards indicate a strong capacity to handle large, complex naval construction projects.

What is the potential impact of this contract on the small business industrial base, considering it's not a small business set-aside?

While this contract is not a small business set-aside, it can still have a significant impact on the small business industrial base through subcontracting opportunities. Prime contractors like Marinette Marine Corporation often rely on a network of small businesses for specialized components, materials, manufacturing processes, and support services. The scale of this $280.7 million contract suggests that there will likely be numerous subcontracting opportunities across various trades and industries. The Department of Defense often mandates small business subcontracting goals for prime contractors, encouraging them to actively seek out and engage small businesses. Therefore, this contract could stimulate economic activity and provide revenue streams for numerous small businesses involved in the defense supply chain, fostering growth and innovation within that segment of the industrial base.

Industry Classification

NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing

Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Consiglio Nazionale Delle Ricerche (UEI: 655149347)

Address: 1600 ELY ST, MARINETTE, WI, 08

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

Contract Characteristics

Cost or Pricing Data: NO

Timeline