DoD awards $24.7M contract for M915 vehicle kits to BAE Systems, raising questions on competition and value

Contract Overview

Contract Amount: $24,687,919 ($24.7M)

Contractor: BAE Systems Survivability Systems LLC

Awarding Agency: Department of Defense

Start Date: 2008-04-01

End Date: 2009-12-30

Contract Duration: 638 days

Daily Burn Rate: $38.7K/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/UCA FOR CAB FIELD KITS FOR M915 VEHICLES WITH AOA KITS.

Place of Performance

Location: FAIRFIELD, BUTLER County, OHIO, 45014

State: Ohio Government Spending

Plain-Language Summary

Department of Defense obligated $24.7 million to BAE SYSTEMS SURVIVABILITY SYSTEMS LLC for work described as: LETTER CONTRACT/UCA FOR CAB FIELD KITS FOR M915 VEHICLES WITH AOA KITS. Key points: 1. Contract awarded to BAE Systems for specialized vehicle kits. 2. Significant value of $24.7 million for military vehicle components. 3. Competition method raises concerns about price discovery and taxpayer value. 4. Spending falls within the Defense sector, specifically armored vehicle manufacturing.

Value Assessment

Rating: questionable

The contract value of $24.7 million for CAB field kits and AOA kits for M915 vehicles appears high given the relatively short duration and the nature of the components. Benchmarking against similar vehicle upgrade kits or component manufacturing contracts is difficult without more specific data, but the price warrants scrutiny.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competition. This method, while potentially justified by specific circumstances, can restrict price discovery and may lead to higher costs for taxpayers compared to full and open competition.

Taxpayer Impact: The limited competition and potential lack of robust price negotiation could result in a less optimal use of taxpayer funds, potentially increasing the overall cost of military vehicle sustainment.

Public Impact

Taxpayers may be overpaying for essential military vehicle components due to restricted competition. The effectiveness of the M915 vehicle's operational readiness could be impacted by the quality and timely delivery of these kits. This contract highlights potential inefficiencies in the procurement process for specialized military equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about price reasonableness.
Lack of transparency in source exclusion.
Potential for cost overruns due to non-competitive award.

Positive Signals

Award to established defense contractor.
Contract addresses specific military vehicle needs.

Sector Analysis

This contract falls within the Defense sector, specifically the manufacturing of military armored vehicles and components. Spending in this area is often characterized by high unit costs, long development cycles, and specialized requirements, making direct comparisons challenging.

Small Business Impact

The contract was awarded to BAE SYSTEMS SURVIVABILITY SYSTEMS LLC, a large defense contractor. There is no indication that small businesses were involved in this specific award, which is common for large, specialized defense contracts.

Oversight & Accountability

The contract's limited competition and the exclusion of sources warrant further oversight to ensure the Department of the Army received fair pricing and that the procurement process was justified. Accountability for the justification of source exclusion is crucial.

Related Government Programs

Military Armored Vehicle, Tank, and Tank Component Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Limited competition may inflate costs.
Lack of transparency in source exclusion.
Potential for suboptimal value for taxpayer money.
High contract value for a specific component set.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.7 million to BAE SYSTEMS SURVIVABILITY SYSTEMS LLC. LETTER CONTRACT/UCA FOR CAB FIELD KITS FOR M915 VEHICLES WITH AOA KITS.

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 Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $24.7 million.

What is the period of performance?

Start: 2008-04-01. End: 2009-12-30.

What specific technical or logistical reasons necessitated the exclusion of other potential sources, and how were these justifications validated?

The justification for excluding other sources typically involves factors like unique technical capabilities, proprietary technology, urgent need, or existing integration requirements. The Department of the Army would need to provide documentation demonstrating that only BAE Systems could meet these specific, validated requirements to justify the limited competition and ensure fair pricing was still pursued.

How does the per-unit cost of these CAB field kits compare to similar kits for other military vehicles or commercial applications, if available?

Without access to specific cost breakdowns or comparable commercial data, a direct per-unit cost comparison is difficult. However, the $24.7 million award over a 638-day period suggests a significant investment. A thorough analysis would require benchmarking against historical data for similar military procurements or, where applicable, commercial equivalents, considering any unique military specifications.

What performance metrics or quality assurance measures are in place to ensure the effectiveness and reliability of the delivered kits for the M915 vehicles?

The contract likely includes standard government quality assurance clauses and performance specifications. However, the effectiveness of these measures depends on rigorous inspection, testing, and acceptance protocols. The Department of the Army should have defined acceptance criteria and potentially performance-based payment schedules tied to the successful integration and functionality of the kits.

Industry Classification

NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing

Product/Service Code: VEHICULAR EQUIPMENT COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

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: $24,687,919

Exercised Options: $24,687,919

Current Obligation: $24,687,919

Contract Characteristics

Cost or Pricing Data: NO

Timeline