General Dynamics-OTS awarded $89.8M for artillery charge manufacturing, a significant investment in ammunition production
Contract Overview
Contract Amount: $89,756,253 ($89.8M)
Contractor: General Dynamics-Ots, Inc.
Awarding Agency: Department of Defense
Start Date: 2008-12-20
End Date: 2015-09-30
Contract Duration: 2,475 days
Daily Burn Rate: $36.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: THE LOAD, ASSEMBLE AND PACK (L.A.P.) 155MM M231 AND M232A1 MODULAR ARTILLERY CHARGE (MACS) PROPELLING CHARGE INCREMENTS
Place of Performance
Location: WILLISTON, CHITTENDEN County, VERMONT, 05495
State: Vermont Government Spending
Plain-Language Summary
Department of Defense obligated $89.8 million to GENERAL DYNAMICS-OTS, INC. for work described as: THE LOAD, ASSEMBLE AND PACK (L.A.P.) 155MM M231 AND M232A1 MODULAR ARTILLERY CHARGE (MACS) PROPELLING CHARGE INCREMENTS Key points: 1. The contract value represents a substantial commitment to ensuring the availability of critical artillery components. 2. Competition dynamics for this contract are crucial for assessing price efficiency and contractor performance. 3. The duration of the contract suggests a long-term need for these specialized ammunition components. 4. Performance context is key to understanding the reliability and effectiveness of the manufactured charges. 5. This contract positions General Dynamics-OTS as a key supplier within the defense ammunition sector.
Value Assessment
Rating: good
The contract value of $89.8 million for artillery charges appears reasonable given the specialized nature of defense manufacturing. Benchmarking against similar contracts for ammunition components is necessary for a definitive value assessment. The firm-fixed-price structure suggests that cost risks are largely borne by the contractor, which can incentivize efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This competitive process is generally expected to yield better pricing and encourage innovation. The presence of two bids suggests a moderate level of competition for this specialized defense requirement.
Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down costs through market forces and ensuring the government receives the best value for its investment.
Public Impact
The U.S. Army benefits from a reliable supply of essential artillery ammunition. Services delivered include the manufacturing and assembly of specific modular artillery charge increments. The geographic impact is primarily on the contractor's facilities and the supply chain supporting them. Workforce implications include skilled manufacturing jobs related to defense production.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for supply chain disruptions impacting delivery timelines.
- Ensuring consistent quality control for explosive ordnance is paramount.
- Dependence on a single contractor for critical components could pose a risk.
Positive Signals
- Contractor's established track record in defense manufacturing.
- Firm-fixed-price contract aligns incentives for cost control.
- Long-term nature of the contract provides supply chain stability.
Sector Analysis
The defense ammunition manufacturing sector is highly specialized, characterized by stringent quality requirements and significant barriers to entry due to technology and safety regulations. This contract for modular artillery charges fits within the broader ammunition manufacturing industry, which is a critical component of national defense readiness. Comparable spending benchmarks would involve analyzing other large-scale contracts for similar ordnance production.
Small Business Impact
This contract was not set aside for small businesses, and there is no explicit indication of subcontracting requirements for small businesses. The primary contractor, General Dynamics-OTS, is a large entity, suggesting that the direct impact on the small business ecosystem may be limited unless they engage small businesses in their supply chain.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of Defense's contracting and quality assurance procedures. Accountability measures are embedded in the firm-fixed-price contract terms, requiring the contractor to meet specifications and delivery schedules. Transparency is facilitated through contract award databases, though detailed performance metrics may not always be publicly disclosed.
Related Government Programs
- Artillery Systems
- Ammunition Manufacturing
- Defense Procurement
- Modular Artillery Charge Systems (MACS)
Risk Flags
- Potential for supply chain vulnerabilities
- Quality control for explosive materials
- Limited number of bidders in a specialized market
Tags
defense, ammunition, artillery, manufacturing, general-dynamics-ots, department-of-the-army, firm-fixed-price, full-and-open-competition, definitive-contract, vermont, ordnance
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $89.8 million to GENERAL DYNAMICS-OTS, INC.. THE LOAD, ASSEMBLE AND PACK (L.A.P.) 155MM M231 AND M232A1 MODULAR ARTILLERY CHARGE (MACS) PROPELLING CHARGE INCREMENTS
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS-OTS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $89.8 million.
What is the period of performance?
Start: 2008-12-20. End: 2015-09-30.
What is General Dynamics-OTS's track record with similar defense contracts?
General Dynamics-OTS, Inc. (GD-OTS) has a long-standing history of supplying munitions and ordnance to the U.S. military and allied nations. They are known for producing a wide range of ammunition, including artillery shells, mortar rounds, and tank rounds. Their experience spans decades, and they have been a consistent recipient of contracts for various types of ammunition, often through competitive bidding processes. GD-OTS has also been involved in modernization efforts and the development of new munitions. Their track record generally indicates a capacity to meet large-scale production demands and adhere to stringent military specifications, though like any large defense contractor, they may have faced scrutiny on specific contract performance or pricing in the past. This specific contract for MACS propelling charge increments builds upon their established expertise in propellant and explosive systems.
How does the value of this contract compare to other artillery charge procurements?
The $89.8 million awarded to General Dynamics-OTS for the LOAD, ASSEMBLE AND PACK (L.A.P.) 155MM M231 AND M232A1 MODULAR ARTILLERY CHARGE (MACS) PROPELLING CHARGE INCREMENTS is a significant sum, reflecting the scale and complexity of producing specialized artillery components. To benchmark this value effectively, one would need to compare it against other contracts for similar ammunition types, particularly 155mm modular charges, from different manufacturers or awarded over different periods. Factors such as the quantity of charges, specific technological requirements, and the prevailing market conditions at the time of award heavily influence contract values. Without direct comparative data on identical or highly similar contracts, it's challenging to definitively state if this represents a particularly high or low value. However, the firm-fixed-price nature suggests a commitment to a set cost for a defined scope of work.
What are the primary risks associated with this contract?
The primary risks associated with this contract revolve around the inherent complexities of defense manufacturing and supply chain management. Firstly, there's a risk of supply chain disruptions, which could impact the timely delivery of raw materials or components, potentially delaying production. Secondly, ensuring consistent quality control for explosive ordnance is critical; any lapse could have severe operational and safety consequences. Thirdly, there's a potential for cost overruns if unforeseen issues arise, although the firm-fixed-price contract structure aims to mitigate this by placing the cost risk on the contractor. Lastly, geopolitical factors or changes in defense strategy could alter future demand for these specific artillery charges, impacting the long-term viability of this production line.
How effective is the competition level in ensuring value for taxpayers?
The contract was awarded under 'full and open competition,' with two bids received. While two bidders represent a level of competition, it is on the lower end of what might be considered robust. Full and open competition is the preferred method for ensuring the government receives competitive pricing and best value. However, the effectiveness is contingent on the number of capable bidders and the intensity of their competition. In highly specialized defense markets, the number of qualified suppliers can be limited. In this case, the presence of two bidders suggests that the market has at least some capacity for competition. The firm-fixed-price contract type further supports taxpayer value by capping the government's financial exposure, provided the contractor can execute within that price.
What are the historical spending patterns for this type of ammunition?
Historical spending on artillery ammunition, particularly for 155mm systems, has been substantial and often cyclical, driven by operational tempo, strategic needs, and modernization programs. The U.S. Army, as the primary user, consistently invests in maintaining adequate stocks of various types of ammunition, including propelling charges. Spending patterns are influenced by factors such as ongoing conflicts, readiness goals, and the phasing out of older systems in favor of newer ones. Contracts like this one for MACS propelling charges indicate a sustained investment in maintaining and potentially increasing the inventory of modern artillery munitions. Analyzing past contract awards for similar items would reveal trends in volume, pricing, and the number of competing contractors over time, providing context for the current $89.8 million award.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W15QKN08R0347
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp (UEI: 001381284)
Address: 128 LAKESIDE AVE, BURLINGTON, VT, 05401
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $89,756,253
Exercised Options: $89,756,253
Current Obligation: $89,756,253
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2008-12-20
Current End Date: 2015-09-30
Potential End Date: 2015-09-30 12:09:00
Last Modified: 2017-08-09
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