State Department awarded $24M for armored vehicles to BAE Systems, highlighting a non-competitive contract

Contract Overview

Contract Amount: $24,069,618 ($24.1M)

Contractor: BAE Systems Survivability Systems LLC

Awarding Agency: Department of State

Start Date: 2007-09-12

End Date: 2009-06-01

Contract Duration: 628 days

Daily Burn Rate: $38.3K/day

Competition Type: NON-COMPETITIVE DELIVERY ORDER

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ARMORED VEHICLES

Place of Performance

Location: FAIRFIELD, BUTLER County, OHIO, 45014

State: Ohio Government Spending

Plain-Language Summary

Department of State obligated $24.1 million to BAE SYSTEMS SURVIVABILITY SYSTEMS LLC for work described as: ARMORED VEHICLES Key points: 1. The contract's value of $24 million for armored vehicles suggests a significant investment in specialized equipment. 2. A sole-source award indicates a lack of broader market competition, potentially impacting price and innovation. 3. The duration of the contract (628 days) provides context for the delivery timeline of these critical assets. 4. The fixed-price nature of the contract aims to control costs, but the non-competitive aspect warrants scrutiny. 5. The award to BAE Systems, a major defense contractor, places this spending within the context of established industry players. 6. The absence of small business involvement (ss: false, sb: false) means opportunities for smaller firms were not prioritized in this specific award.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without comparable sole-source armored vehicle procurements. However, the $24 million figure for a limited number of vehicles over approximately two years suggests a substantial per-unit cost. The firm fixed-price structure is a positive indicator for cost control, but the lack of competition means there's no direct market comparison to assess if the price represents optimal value for money. Further analysis would require understanding the specific capabilities and quantities of the armored vehicles procured.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a non-competitive delivery order, meaning it was not subject to a broad solicitation process. The data indicates only one award was made, suggesting that either BAE Systems was the only capable provider or the circumstances of the award did not allow for open competition. This lack of competition limits the government's ability to explore alternative solutions or negotiate based on multiple offers, potentially leading to higher prices than if a competitive process had been employed.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. Without multiple offers, the government had less leverage to secure the best possible price for these specialized vehicles.

Public Impact

The primary beneficiaries are likely government personnel requiring enhanced protection during operations, potentially in high-risk environments. The services delivered involve the provision of specialized armored vehicles, crucial for security and operational continuity. The geographic impact is primarily linked to the operational deployment of these vehicles, likely supporting diplomatic or security missions. Workforce implications are minimal for the public, but the contract supports jobs within BAE Systems and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits price discovery and potentially increases costs for taxpayers.
Lack of small business participation means missed opportunities for smaller, innovative firms.
Contract duration of over two years requires careful monitoring for scope creep or performance issues.
Specific details on vehicle capabilities and quantities are not provided, hindering a full value assessment.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established contractor like BAE Systems suggests a known entity with relevant experience.
The contract addresses a clear need for specialized protective equipment.

Sector Analysis

The procurement of armored vehicles falls within the broader defense and security sector, a significant area of federal spending. This market is characterized by specialized manufacturing, high technological requirements, and often involves large, established contractors. The market size for such specialized equipment is substantial, driven by global security needs and government mandates for personnel protection. This contract represents a specific instance of spending within this sector, likely for diplomatic security or specialized operational support.

Small Business Impact

This contract was not set aside for small businesses, and the data indicates no small business participation (ss: false, sb: false). This suggests that the procurement was either too specialized or too large in scope for typical small business offerings, or that the contracting strategy did not prioritize small business inclusion. Consequently, there are no direct subcontracting implications for small businesses stemming from this specific award, and the broader small business ecosystem does not benefit from this particular contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of State's contracting and program management offices. As a delivery order under a larger contract vehicle (implied by 'delivery order'), oversight might also be influenced by the terms of the original contract. Accountability measures would involve performance monitoring against the contract's specifications and delivery schedules. Transparency is limited due to the non-competitive nature of the award; however, contract award data is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of State Vehicle Procurement
Armored Vehicle Acquisition Programs
Specialized Security Equipment Contracts
Non-Competitive Federal Awards

Risk Flags

Non-competitive award
Lack of detailed specifications
Potential for higher cost due to sole-source nature

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $24.1 million to BAE SYSTEMS SURVIVABILITY SYSTEMS LLC. ARMORED VEHICLES

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS SURVIVABILITY SYSTEMS LLC.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $24.1 million.

What is the period of performance?

Start: 2007-09-12. End: 2009-06-01.

What specific type and quantity of armored vehicles were procured under this contract?

The provided data does not specify the exact type or quantity of armored vehicles procured under this contract. The description 'ARMORED VEHICLES' is general, and the National Industry Service (NIS) code 'All Other Motor Vehicle Dealers' is broad. Without more detailed specifications, it is impossible to determine the exact nature of the vehicles, their protective capabilities, or how many units were delivered. This lack of specificity makes a precise assessment of value for money and operational suitability difficult. Further investigation into the contract's statement of work or associated documentation would be necessary to ascertain these critical details.

What is the historical spending pattern for armored vehicles by the Department of State?

The provided data only details a single contract award of $24,069,618 for armored vehicles to BAE Systems Survivability Systems LLC, awarded on September 12, 2007, and ending on June 1, 2009. This single data point does not provide sufficient information to establish a historical spending pattern for armored vehicles by the Department of State. To understand historical trends, one would need to analyze multiple contracts over several fiscal years, looking at total spending, types of vehicles procured, contractors involved, and the competitive nature of those awards. This contract represents a snapshot of spending during a specific period and does not offer insights into broader patterns or changes in procurement strategies over time.

What are the specific risks associated with a sole-source award for critical equipment like armored vehicles?

Sole-source awards for critical equipment like armored vehicles carry several inherent risks. Firstly, the lack of competition can lead to inflated prices, as the government does not benefit from the price discovery mechanisms of a competitive bidding process. Secondly, it limits the government's ability to explore a wider range of technological solutions or innovative designs that might be offered by other manufacturers. Thirdly, it can create a dependency on a single supplier, potentially leading to supply chain vulnerabilities or reduced leverage in future negotiations. Finally, without competitive pressure, there might be less incentive for the sole-source provider to maintain high standards of quality or customer service, although contract oversight can mitigate this.

How does the firm fixed-price contract type mitigate risks for this armored vehicle procurement?

The firm fixed-price (FFP) contract type is designed to provide cost certainty for the government. Under an FFP agreement, the contractor agrees to a set price for the work or product, regardless of the actual costs incurred. This shifts the risk of cost overruns from the government to the contractor. For an armored vehicle procurement, this means the Department of State knows the total expenditure upfront, assuming no contract modifications. This structure helps in budget planning and prevents unexpected increases in the total contract value due to the contractor's performance or cost management. However, it's important to note that the initial price negotiated in an FFP contract can be higher to account for the contractor's risk.

What is the track record of BAE Systems Survivability Systems LLC in delivering armored vehicles to the government?

BAE Systems Survivability Systems LLC is a well-established entity within the defense industry, known for its extensive experience in developing and manufacturing armored vehicles and related survivability systems. While this specific data point only shows one contract, BAE Systems as a whole has a long history of supplying armored platforms to various government agencies, including the U.S. military and international allies. Their track record generally includes delivering complex, high-value systems. However, the performance specifics for this particular $24 million contract, such as on-time delivery, adherence to specifications, and overall quality, are not detailed in the provided summary data. A comprehensive assessment would require reviewing performance reports and past contract history for this specific subsidiary or product line.

Industry Classification

NAICS: Retail Trade › Other Motor Vehicle Dealers › All Other Motor Vehicle Dealers

Product/Service Code: MISCELLANEOUS

Competition & Pricing

Extent Competed: NON-COMPETITIVE DELIVERY ORDER

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 9113 LE SAINT DR, FAIRFIELD, OH, 08

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $70,926,363

Exercised Options: $70,825,038

Current Obligation: $24,069,618

Parent Contract

Parent Award PIID: SAQMMA07D0023

IDV Type: IDC

Timeline