DoD awards $16.6M for OTO Support Equipment, with no competition

Contract Overview

Contract Amount: $16,626,235 ($16.6M)

Contractor: Thales Defense & Security Inc

Awarding Agency: Department of Defense

Start Date: 2022-04-07

End Date: 2026-05-21

Contract Duration: 1,505 days

Daily Burn Rate: $11.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: OTO SUPPORT EQUIPMENT FOR H1

Place of Performance

Location: CLARKSBURG, MONTGOMERY County, MARYLAND, 20871

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $16.6 million to THALES DEFENSE & SECURITY INC for work described as: OTO SUPPORT EQUIPMENT FOR H1 Key points: 1. Significant contract value of $16.6 million. 2. Sole-source award raises questions about price discovery. 3. Long contract duration of 1505 days. 4. Sector: Defense (Optical Instrument and Lens Manufacturing).

Value Assessment

Rating: questionable

The contract value of $16.6 million for OTO Support Equipment is difficult to assess without specific unit cost data. The lack of competition makes it challenging to benchmark against similar procurements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating no competition. This method limits price discovery and may result in higher costs for taxpayers.

Taxpayer Impact: The absence of competition could lead to inflated prices, impacting taxpayer value.

Public Impact

Taxpayers may be overpaying due to the lack of competitive bidding. Limited transparency into the justification for a sole-source award. Potential for reduced innovation without market competition.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Long contract duration

Positive Signals

Definitive contract award
Firm Fixed Price contract type

Sector Analysis

This contract falls within the Optical Instrument and Lens Manufacturing sector, a specialized area within the broader defense industry. Spending benchmarks for similar sole-source procurements in this niche are not readily available.

Small Business Impact

The data indicates that small businesses were not involved in this contract, as the 'sb' field is false. Further analysis would be needed to determine if opportunities were missed for small business participation.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny. Oversight should focus on the justification for avoiding competition and ensuring fair pricing was achieved.

Related Government Programs

Optical Instrument and Lens Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award lacks transparency.
Potential for inflated pricing due to no competition.
Long contract duration may not reflect evolving needs.
Limited opportunity for small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.6 million to THALES DEFENSE & SECURITY INC. OTO SUPPORT EQUIPMENT FOR H1

Who is the contractor on this award?

The obligated recipient is THALES DEFENSE & SECURITY INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $16.6 million.

What is the period of performance?

Start: 2022-04-07. End: 2026-05-21.

What is the justification for awarding this contract on a sole-source basis?

The justification for a sole-source award typically involves circumstances where only one responsible source can provide the required supplies or services. This could be due to unique capabilities, proprietary technology, or urgent and compelling needs. Without specific documentation, it's impossible to confirm the exact reason, but it necessitates a review to ensure it was appropriate and not a missed opportunity for competition.

How can the government ensure fair pricing without competition?

When competition is not feasible, the government can employ various methods to ensure fair and reasonable pricing. These include conducting thorough market research, obtaining cost and pricing data from the contractor, using historical pricing data for similar items, and applying cost realism analyses. Independent government cost estimates are also crucial. Regular audits and reviews can further help validate pricing.

What is the potential impact of a long-term, sole-source contract on future procurements?

A long-term, sole-source contract can create a vendor lock-in situation, making it difficult and potentially more expensive to switch to alternative suppliers in the future. It may also disincentivize the contractor from offering competitive pricing over the contract's life. This can limit market entry for new competitors and stifle innovation, potentially leading to higher costs for the government in subsequent procurements.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Optical Instrument and Lens Manufacturing

Product/Service Code: MAINT/REPAIR SHOP EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N6833520R0313

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Thales

Address: 22605 GATEWAY CENTER DR, CLARKSBURG, MD, 20871

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $20,882,958

Exercised Options: $16,626,235

Current Obligation: $16,626,235

Subaward Activity

Number of Subawards: 6

Total Subaward Amount: $6,920,339

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline