DoD awards $177.6M for military vehicle kits and assemblies to ND Defense LLC

Contract Overview

Contract Amount: $177,619,505 ($177.6M)

Contractor: ND Defense LLC

Awarding Agency: Department of Defense

Start Date: 2012-09-14

End Date: 2014-06-30

Contract Duration: 654 days

Daily Burn Rate: $271.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: AWARD 2,360 MSU KITS, 2,329 VEE WINDOW ASSEMBLIES AND ENGINEERING AND LOGISTICS SUPPORT.

Place of Performance

Location: LISLE, DUPAGE County, ILLINOIS, 60532

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $177.6 million to ND DEFENSE LLC for work described as: AWARD 2,360 MSU KITS, 2,329 VEE WINDOW ASSEMBLIES AND ENGINEERING AND LOGISTICS SUPPORT. Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Firm fixed-price contract type suggests cost certainty for the government. 3. Contract duration of 654 days indicates a medium-term supply need. 4. The award represents a significant investment in armored vehicle components. 5. Geographic location of contractor in Illinois may influence logistics costs.

Value Assessment

Rating: fair

The contract value of $177.6 million for military vehicle kits and assemblies appears substantial. Without specific details on the quantity and complexity of the kits and assemblies, a direct comparison to similar contracts is challenging. However, the sole-source nature of the award raises concerns about whether the government achieved the best possible price. Benchmarking against industry standards for similar components would be necessary to fully assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, ND Defense LLC, was solicited. This approach bypasses the competitive bidding process, which typically leads to lower prices and greater innovation. The lack of competition means the government did not benefit from multiple offers and the potential for price discovery that arises from a competitive environment.

Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying a premium for goods and services, as there was no opportunity for vendors to bid against each other to offer the best price.

Public Impact

The primary beneficiaries are the U.S. Army, receiving critical components for military vehicles. The contract delivers essential kits and window assemblies for armored vehicles. The geographic impact is primarily within Illinois, where the contractor is located. Workforce implications may include job creation or retention at ND Defense LLC and its suppliers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings.
Lack of transparency in the justification for sole-source procurement.
Potential for cost overruns due to absence of competitive pressure.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Contract addresses a specific and critical need for military vehicle components.
Contractor located in Illinois, potentially supporting domestic manufacturing.

Sector Analysis

This contract falls within the Defense Industrial Base sector, specifically focusing on the manufacturing of military vehicle components. The market for such specialized parts is often characterized by a limited number of qualified suppliers due to high technical barriers and security requirements. Spending in this area is directly tied to national defense priorities and modernization efforts for the U.S. military's armored fleet.

Small Business Impact

The contract details indicate that small business participation was not a primary consideration, as the award was made to ND Defense LLC and there is no indication of small business set-asides or subcontracting plans. This sole-source award does not appear to directly benefit the small business ecosystem in this instance, as the primary contract was not competed.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations. Accountability measures are inherent in the firm fixed-price structure, which aims to hold the contractor responsible for delivering within the agreed-upon cost. Transparency is limited due to the sole-source nature of the award, with specific justifications for this procurement method likely held within agency records.

Related Government Programs

Military Vehicle Modernization Programs
Armored Vehicle Component Procurement
Defense Logistics Support Contracts

Risk Flags

Sole-source award raises concerns about price competition.
Lack of detailed technical specifications in summary data.
Limited public information on contractor's past performance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $177.6 million to ND DEFENSE LLC. AWARD 2,360 MSU KITS, 2,329 VEE WINDOW ASSEMBLIES AND ENGINEERING AND LOGISTICS SUPPORT.

Who is the contractor on this award?

The obligated recipient is ND DEFENSE 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 $177.6 million.

What is the period of performance?

Start: 2012-09-14. End: 2014-06-30.

What specific types of military vehicle kits and window assemblies were procured under this contract, and what are their technical specifications?

The provided data indicates the procurement of 'AWARD 2,360 MSU KITS, 2,329 VEE WINDOW ASSEMBLIES AND ENGINEERING AND LOGISTICS SUPPORT.' While the quantity is specified, the exact technical specifications, materials, and intended vehicle platforms for these MSU kits and VEE window assemblies are not detailed in the summary data. These components are likely critical for the operational readiness and protection of specific armored vehicles within the Department of Defense's inventory. Further details would typically be found in the contract's statement of work or technical exhibits, which are not publicly available in this abbreviated format. Understanding these specifications is crucial for assessing the complexity and criticality of the procurement.

What was the justification for awarding this contract on a sole-source basis to ND Defense LLC?

The justification for a sole-source award is typically based on specific criteria outlined in federal acquisition regulations, such as the existence of only one responsible source capable of providing the required supplies or services, or a compelling urgency that precludes full and open competition. For this contract, the specific justification is not provided in the summary data. However, common reasons for sole-sourcing defense contracts include proprietary technology, unique manufacturing capabilities, or the need to maintain compatibility with existing systems where only one vendor can meet the requirements. Without the official justification document (e.g., a Justification and Approval - J&A), it is impossible to definitively state the rationale behind awarding this $177.6 million contract without competition.

How does the unit cost of these kits and assemblies compare to similar procurements or industry benchmarks?

Directly comparing the unit cost is challenging without knowing the exact specifications and quantities of the 'MSU KITS' and 'VEE WINDOW ASSEMBLIES.' The total award of $177,619,505.02 for 2,360 kits and 2,329 assemblies suggests an average cost of approximately $75,578 per kit and $76,265 per assembly. These figures are high-level averages and do not account for the engineering and logistics support included. Given the specialized nature of military vehicle components, especially armored ones, costs can be significantly higher than commercial equivalents due to stringent performance, durability, and safety requirements. A true benchmark would require detailed technical data and comparison with other sole-source or competitively awarded contracts for identical or highly similar components.

What is ND Defense LLC's track record with the Department of Defense, particularly regarding performance on similar contracts?

The provided data identifies ND Defense LLC as the contractor for this $177.6 million award. However, it does not offer specific details about the company's past performance history with the Department of Defense or other government agencies. To assess their track record, one would need to examine past contract awards, performance evaluations (such as Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or contract terminations. A company's history of delivering on time, within budget, and to specification is a critical factor in evaluating the risk associated with a new award, especially a sole-source one.

What are the potential risks associated with this sole-source contract, and what mitigation strategies might be in place?

The primary risk associated with this sole-source contract is the potential for inflated pricing due to the lack of competition. Without competing bids, ND Defense LLC may not have been incentivized to offer the lowest possible price. Other risks include potential quality issues if oversight is insufficient, or schedule delays if the contractor faces production challenges. Mitigation strategies could include robust government oversight of contract performance, detailed technical inspections, and potentially negotiating favorable terms in the fixed-price contract to limit the government's exposure to cost increases. However, the absence of competition inherently limits the government's leverage.

Industry Classification

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

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

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: Navistar International Corporation (UEI: 161984646)

Address: 2701 NAVISTAR WAY, LISLE, IL, 60532

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $177,619,505

Exercised Options: $177,619,505

Current Obligation: $177,619,505

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline