DoD awards $243M Letter Contract to General Dynamics for Navigation Systems
Contract Overview
Contract Amount: $243,195,666 ($243.2M)
Contractor: General Dynamics Mission Systems, Inc.
Awarding Agency: Department of Defense
Start Date: 2010-09-17
End Date: 2019-12-17
Contract Duration: 3,378 days
Daily Burn Rate: $72.0K/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: LETTER CONTRACT
Place of Performance
Location: SCOTTSDALE, MARICOPA County, ARIZONA, 85257
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $243.2 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: LETTER CONTRACT Key points: 1. Significant contract value of $243M awarded to a single large business. 2. Competition method 'Full and Open Competition After Exclusion of Sources' suggests limited initial competition. 3. Contract duration of 3378 days indicates a long-term commitment. 4. The sector is Defense, specifically Navigation System Manufacturing.
Value Assessment
Rating: fair
The contract type is a Letter Contract, which is an initial agreement often used to start work quickly before a definitive contract is finalized. Pricing assessment is difficult without knowing the terms of the definitive contract that followed.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, certain sources were excluded. This method can impact price discovery by potentially limiting the pool of bidders.
Taxpayer Impact: The $243M award represents a substantial taxpayer investment. The effectiveness of the competition method in securing the best value for taxpayers is a key consideration.
Public Impact
Taxpayers are funding advanced navigation systems for defense applications. The long contract duration suggests a sustained need for these systems. Potential for cost overruns or inefficiencies due to the initial letter contract structure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Letter contract structure can lead to less competitive pricing initially.
- Exclusion of sources may limit competitive options.
- Long contract duration increases risk of cost escalation.
Positive Signals
- Awarded to a known defense contractor.
- Definitive contract likely followed, providing more structure.
Sector Analysis
This contract falls within the Defense sector, specifically the manufacturing of navigation systems. Spending in this area is critical for military operations, and benchmarks often focus on technological advancement and reliability alongside cost.
Small Business Impact
The contract was awarded to General Dynamics Mission Systems, Inc., a large business. There is no indication of small business participation in the provided data.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency (DCMA), indicating oversight. However, the initial letter contract phase may have had less stringent oversight compared to a fully negotiated definitive contract.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for cost creep due to letter contract.
- Limited competition due to source exclusion.
- Long contract duration increases risk.
- Lack of small business participation.
Tags
search-detection-navigation-guidance-aer, department-of-defense, az, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $243.2 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. LETTER CONTRACT
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 $243.2 million.
What is the period of performance?
Start: 2010-09-17. End: 2019-12-17.
What was the final negotiated price and terms of the definitive contract that succeeded this letter contract?
The letter contract served as an initial agreement. The definitive contract, which would contain the final pricing and terms, is crucial for a complete value assessment. Without its details, it's difficult to ascertain the true cost-effectiveness and taxpayer value achieved beyond the initial award amount.
What specific sources were excluded, and what was the justification for their exclusion?
The justification for excluding specific sources under 'Full and Open Competition After Exclusion of Sources' is critical for understanding the competitive landscape. If exclusions were not well-founded, it could indicate a missed opportunity for better pricing and innovation, potentially increasing risk for the government.
How did the performance and cost of the systems delivered under this contract compare to industry benchmarks?
Evaluating the performance and cost against industry benchmarks is essential for assessing effectiveness. If the systems met or exceeded performance expectations at a competitive cost, it signifies good value. Conversely, deviations could highlight inefficiencies or areas where taxpayer funds were not optimally utilized.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0003909R0062
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Wico Limited
Address: 8201 E MCDOWELL ROAD, SCOTTSDALE, AZ, 85257
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $313,235,051
Exercised Options: $248,422,690
Current Obligation: $243,195,666
Actual Outlays: $1,635
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2010-09-17
Current End Date: 2019-12-17
Potential End Date: 2023-04-04 00:00:00
Last Modified: 2025-03-10
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