General Dynamics awarded $172.7M for UK Strategic Weapons System engineering support, a sole-source contract

Contract Overview

Contract Amount: $172,668,996 ($172.7M)

Contractor: General Dynamics Mission Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2011-12-29

End Date: 2019-08-13

Contract Duration: 2,784 days

Daily Burn Rate: $62.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Defense

Official Description: UNITED KINGDOM (UK) STRATEGIC WEAPONS SYSTEM (SWS) FIRE CONTROL SUBSYSTEM (FCS) AND SSBN-SUCCESSOR COMMON MISSILE COMPARTMENT (CMC) ENGINEERING SUPPORT

Place of Performance

Location: PITTSFIELD, BERKSHIRE County, MASSACHUSETTS, 01201

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $172.7 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: UNITED KINGDOM (UK) STRATEGIC WEAPONS SYSTEM (SWS) FIRE CONTROL SUBSYSTEM (FCS) AND SSBN-SUCCESSOR COMMON MISSILE COMPARTMENT (CMC) ENGINEERING SUPPORT Key points: 1. Contract awarded to a single vendor suggests potential lack of competitive pressure on pricing. 2. Engineering services for a critical national security system indicate high technical complexity and specialized expertise. 3. Long contract duration (2784 days) may imply a stable, long-term need for these services. 4. The contract type (Cost Plus Incentive Fee) allows for cost overruns but incentivizes performance. 5. Sole-source nature raises questions about the thoroughness of market research and justification for limited competition. 6. The significant value points to the strategic importance and complexity of the UK's nuclear deterrent program.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its highly specialized and sensitive nature, tied to a specific national security program. The Cost Plus Incentive Fee (CPIF) structure means the final cost is not fixed and depends on performance outcomes, making direct price comparisons difficult. Without a competitive bidding process, it's hard to ascertain if the government secured the best possible price for the engineering services rendered. The total award amount of $172.7 million over its period of performance suggests a substantial investment, but its value-for-money is contingent on the successful delivery of critical support for the UK's Strategic Weapons System.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically justified when only one responsible source is available or capable of meeting the requirement. The lack of competition means that the government did not benefit from the price discovery and potential cost savings that typically arise from a competitive bidding process. The justification for sole-source procurement in such sensitive defense programs often centers on unique capabilities, proprietary technology, or national security imperatives.

Taxpayer Impact: The absence of competition means taxpayers may not have received the most cost-effective solution. Without bids from other qualified firms, the potential for inflated pricing or less favorable terms exists.

Public Impact

The primary beneficiary is the United Kingdom's Ministry of Defence, receiving critical engineering support for its Strategic Weapons System. Services delivered include engineering support for the Fire Control Subsystem (FCS) and the SSBN-Successor Common Missile Compartment (CMC). The geographic impact is primarily within the defense sector, supporting a key alliance capability. Workforce implications include the need for highly specialized engineers and technical personnel within General Dynamics Mission Systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially impacting cost-effectiveness for taxpayers.
Cost-plus contract types can lead to cost overruns if not managed diligently.
The highly specialized nature of the work may create vendor lock-in, reducing future flexibility.
Lack of transparency inherent in sole-source defense contracts can obscure true value for money.

Positive Signals

Award to a single, established contractor suggests a high level of trust and proven capability for a critical system.
The Cost Plus Incentive Fee structure aims to align contractor performance with government objectives.
Long-term contract indicates a stable and predictable need, allowing for focused resource allocation.
Engineering support for a strategic weapons system signifies a vital contribution to national security and alliance capabilities.

Sector Analysis

This contract falls within the Defense Engineering Services sector, a niche market characterized by high technical barriers to entry and significant government reliance. The market for specialized engineering support for strategic weapons systems is extremely limited, often dominated by a few prime contractors with the necessary security clearances and expertise. Spending in this sub-sector is driven by the lifecycle management of complex, high-value defense platforms. Comparable spending benchmarks are difficult to establish due to the unique nature of nuclear deterrent systems and the classified aspects of their support.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss: false' and 'sb: false'. The prime contractor, General Dynamics Mission Systems, Inc., is a large defense contractor. While large prime contractors are often required to subcontract a portion of their work to small businesses, the specific details of such subcontracting arrangements are not provided in this data. The absence of a direct set-aside means that small businesses were not specifically targeted for this prime contract opportunity.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The Cost Plus Incentive Fee (CPIF) contract type necessitates close monitoring of costs and performance metrics to ensure the government receives value. Transparency is limited due to the sensitive nature of the work, but contract awards and basic details are generally publicly available through federal procurement databases. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

UK Trident Program
US Navy Ballistic Missile Submarine Programs
Strategic Weapons Systems Engineering
Missile Compartment Engineering
Defense Engineering Services

Risk Flags

Sole-source award
Cost-plus contract type
Sensitive defense technology
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $172.7 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. UNITED KINGDOM (UK) STRATEGIC WEAPONS SYSTEM (SWS) FIRE CONTROL SUBSYSTEM (FCS) AND SSBN-SUCCESSOR COMMON MISSILE COMPARTMENT (CMC) ENGINEERING SUPPORT

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS MISSION SYSTEMS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $172.7 million.

What is the period of performance?

Start: 2011-12-29. End: 2019-08-13.

What is the track record of General Dynamics Mission Systems, Inc. in supporting strategic weapons systems?

General Dynamics Mission Systems, Inc. (GDMS) has a long-standing and extensive track record in supporting complex defense programs, including strategic weapons systems. As a major defense contractor, GDMS has been involved in various aspects of naval systems, command and control, and communications for decades. Their experience with the UK's Strategic Weapons System (SWS) specifically, as evidenced by this contract, indicates a deep understanding of its unique requirements. GDMS is known for its capabilities in systems engineering, integration, and sustainment for highly classified and critical defense platforms. Their involvement often spans the entire lifecycle of a weapon system, from design and development through sustainment and modernization. This includes work on fire control systems, missile components, and submarine integration, making them a key player in maintaining the operational readiness of strategic deterrent forces for both the US and its allies.

How does the Cost Plus Incentive Fee (CPIF) contract type compare to other pricing arrangements for similar services?

The Cost Plus Incentive Fee (CPIF) contract type is a variation of cost-reimbursement contracts, designed to provide flexibility while incentivizing contractor performance. Unlike Firm-Fixed-Price (FFP) contracts, which set a fixed price regardless of costs incurred, CPIF allows the contractor to recover allowable costs plus a fee that is adjusted based on meeting or exceeding targets for cost, schedule, or performance. This contrasts with Cost Plus Fixed Fee (CPFF), where the fee is fixed, or Cost Plus Award Fee (CPAF), where the award fee is determined by the government's subjective evaluation of performance. For highly complex, R&D-intensive, or uncertain projects like strategic weapons system engineering, CPIF can be advantageous as it shares risk between the government and contractor. However, it requires robust government oversight to manage costs and ensure targets are meaningful and achievable, and it generally offers less price certainty than FFP contracts.

What are the primary risks associated with a sole-source procurement for critical defense systems?

Sole-source procurements for critical defense systems carry several significant risks. Foremost is the potential for reduced price competition, which can lead to higher costs for the government and taxpayers compared to a competitively bid contract. Without multiple bidders vying for the contract, the incentive for the sole provider to offer the lowest possible price is diminished. Another risk is vendor lock-in; once a single contractor becomes deeply embedded in a complex system, it can be difficult and costly to switch providers in the future, even if performance or pricing becomes unsatisfactory. This can also stifle innovation, as the sole provider may face less pressure to develop more efficient or advanced solutions. Furthermore, sole-source awards can raise concerns about the adequacy of market research conducted by the agency to ensure no other capable sources exist, potentially indicating a lack of due diligence or a pre-determined outcome.

How does the engineering support for the UK's SWS contribute to overall defense capabilities?

Engineering support for the UK's Strategic Weapons System (SWS) is fundamental to maintaining the operational capability and reliability of the UK's nuclear deterrent. The SWS, comprising submarines, missiles, and the fire control systems, is a highly complex and technologically advanced platform. The Fire Control Subsystem (FCS) and the Common Missile Compartment (CMC) are critical components that ensure the missiles can be accurately targeted and launched. Continuous engineering support ensures that these systems remain functional, secure, and up-to-date with evolving threats and technological advancements. This support is vital for the UK's independent strategic deterrence, a cornerstone of its national security policy and a key contribution to NATO's overall security architecture. Without this specialized engineering, the effectiveness and readiness of the UK's most potent strategic asset would be compromised.

What are the implications of the contract's start and end dates (2011-2019) for current support needs?

The contract's period of performance, from December 29, 2011, to August 13, 2019, indicates that this specific award covered engineering support for the UK Strategic Weapons System (SWS) during that timeframe. While this contract is now complete, the ongoing nature of strategic weapons system sustainment implies that similar or follow-on contracts would likely have been awarded to ensure continuous support. The completion of this contract suggests that the initial engineering requirements defined within it were met. However, the dynamic nature of defense technology and strategic requirements means that current support needs may have evolved significantly since 2019. Therefore, understanding the current state of support would require examining subsequent contracts and the evolution of the SWS program beyond this specific award period.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: FIRE CONTROL EQPT.

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0003012R0006

Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 100 PLASTICS AVE, PITTSFIELD, MA, 01201

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

Financial Breakdown

Contract Ceiling: $247,449,989

Exercised Options: $177,218,840

Current Obligation: $172,668,996

Actual Outlays: $2,076,362

Subaward Activity

Number of Subawards: 91

Total Subaward Amount: $18,463,852

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline