Army awards $70.7M for 120mm APMI cartridges to Alliant Techsystems, a sole-source contract
Contract Overview
Contract Amount: $70,749,912 ($70.7M)
Contractor: Alliant Techsystems Operations LLC
Awarding Agency: Department of Defense
Start Date: 2010-06-11
End Date: 2013-09-30
Contract Duration: 1,207 days
Daily Burn Rate: $58.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: CARTRIDGE, 120MM (APMI)
Place of Performance
Location: MINNEAPOLIS, HENNEPIN County, MINNESOTA, 55442
Plain-Language Summary
Department of Defense obligated $70.7 million to ALLIANT TECHSYSTEMS OPERATIONS LLC for work described as: CARTRIDGE, 120MM (APMI) Key points: 1. Significant investment in specialized ammunition for the Department of Defense. 2. Lack of competition raises concerns about potential overpricing and limited innovation. 3. Contract awarded to a single, established defense contractor, potentially excluding smaller, innovative firms. 4. Spending concentrated in the Ammunition Manufacturing sector.
Value Assessment
Rating: questionable
The contract value of $70.7 million for 120mm APMI cartridges appears high given the sole-source nature. Without competitive bidding, it's difficult to benchmark against market rates or similar contracts, suggesting potential for inflated pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This method limits price discovery and may prevent the government from securing the best possible price or innovative solutions from a wider range of suppliers.
Taxpayer Impact: The lack of competition in this sole-source award means taxpayers may be paying a premium for these specialized ammunition components.
Public Impact
Ensures supply of critical ammunition for military operations. Potential for higher costs due to lack of competitive pressure. Limited opportunities for small businesses to participate in this specific contract. Supports a major defense contractor's operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- No small business participation noted
Positive Signals
- Ensures supply of critical defense material
- Contract awarded to established entity
Sector Analysis
This spending falls within the Ammunition (except Small Arms) Manufacturing sector, a critical component of the defense industrial base. Benchmarks for such specialized munitions are often opaque due to the sensitive and non-commercial nature of the products.
Small Business Impact
The contract data indicates no small business participation (sb: false). This sole-source award likely bypassed opportunities for small businesses to compete or subcontract, concentrating the value with a large prime contractor.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny regarding the justification for not seeking competitive bids. Oversight should focus on ensuring the price paid is fair and reasonable, even without competition.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award lacks transparency and competitive pricing.
- Potential for overpayment due to absence of competition.
- No small business participation noted.
- Concentration of spending with a single large contractor.
- Limited visibility into cost drivers and efficiency.
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, mn, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $70.7 million to ALLIANT TECHSYSTEMS OPERATIONS LLC. CARTRIDGE, 120MM (APMI)
Who is the contractor on this award?
The obligated recipient is ALLIANT TECHSYSTEMS OPERATIONS LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $70.7 million.
What is the period of performance?
Start: 2010-06-11. End: 2013-09-30.
What was the justification for awarding this contract on a sole-source basis, and were alternative sourcing strategies considered?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without further documentation, it's unclear if other manufacturers could have met the requirements or if a competitive process was deemed impractical. A thorough review would examine the specific technical requirements and market landscape at the time of award.
How does the unit cost of these 120mm APMI cartridges compare to similar historical contracts or industry benchmarks, considering the sole-source nature?
Benchmarking sole-source contracts is challenging due to the absence of competitive pricing data. If available, historical data for the same item or comparable munitions procured competitively could provide a reference point. However, the lack of competition inherently limits the ability to definitively assess cost-effectiveness against market alternatives.
What is the long-term strategic impact of relying on a single supplier for such critical ammunition components?
Long-term reliance on a single supplier can create vulnerabilities in the supply chain, increase dependency, and potentially stifle innovation. It also concentrates risk with one entity. Diversifying suppliers or fostering competition, where feasible, can enhance resilience, drive down costs, and encourage technological advancements in defense manufacturing.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: SPECIAL INDUSTRY MACHINERY
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Innovation Systems LLC (UEI: 618705925)
Address: 4700 NATHAN LN N, PLYMOUTH, MN, 03
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $70,749,912
Exercised Options: $70,749,912
Current Obligation: $70,749,912
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2010-06-11
Current End Date: 2013-09-30
Potential End Date: 2013-09-30 00:00:00
Last Modified: 2013-08-01
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