Colombia's $31.6M Armored Vehicle Purchase: Textron Systems Awarded Firm Fixed Price Contract

Contract Overview

Contract Amount: $31,604,097 ($31.6M)

Contractor: Textron Systems Corp

Awarding Agency: Department of Defense

Start Date: 2013-07-31

End Date: 2016-09-28

Contract Duration: 1,155 days

Daily Burn Rate: $27.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: THIS ACTION IS IN SUPPORT OF FOREIGN MILITARY SALES (FMS) CASE CO-B-VFX FOR THE COUNTRY OF COLOMBIA BASED ON THE LETTER OF OFFER AND ACCEPTANCE (LOA) IMPLEMENTED 6 AUGUST 2012. THE REQUIREMENT PROVIDES FOR THE PROCUREMENT OF 28 EACH COMMANDO ADVANCED ARMORED PERSONNEL CARRIERS (APCS), DEPROCESSING, REPAIR OF TWO STRUCTURALLY DAMAGED ARMORED SECURITY VEHICLES (ASVS), AND SPARE PARTS FOR THE COLOMBIAN ARMY (COLAR).

Place of Performance

Location: NEW ORLEANS, ORLEANS County, LOUISIANA, 70129

State: Louisiana Government Spending

Plain-Language Summary

Department of Defense obligated $31.6 million to TEXTRON SYSTEMS CORP for work described as: THIS ACTION IS IN SUPPORT OF FOREIGN MILITARY SALES (FMS) CASE CO-B-VFX FOR THE COUNTRY OF COLOMBIA BASED ON THE LETTER OF OFFER AND ACCEPTANCE (LOA) IMPLEMENTED 6 AUGUST 2012. THE REQUIREMENT PROVIDES FOR THE PROCUREMENT OF 28 EACH COMMANDO ADVANCED ARMORED PERSONNEL CARRIERS (… Key points: 1. High value contract for armored personnel carriers and repair services. 2. Sole-source award to Textron Systems Corp, limiting competitive pricing. 3. Potential risk associated with FMS and specific country requirements. 4. Spending falls within the broader 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' sector.

Value Assessment

Rating: questionable

The contract value of $31.6 million for 28 armored vehicles and related services is difficult to benchmark without specific per-unit cost data. The firm fixed-price nature suggests a defined cost, but the lack of competition raises concerns about optimal pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, specifically for Foreign Military Sales (FMS) to Colombia. The absence of competition likely prevented price discovery through market forces, potentially leading to a higher cost for the government and the end-user nation.

Taxpayer Impact: Taxpayer funds are utilized for FMS, and sole-source awards can reduce the overall value for money if not carefully managed and justified.

Public Impact

Enhances Colombia's military capabilities through the acquisition of advanced armored vehicles. Supports U.S. foreign policy objectives by providing defense articles to allied nations. Ensures operational readiness for the Colombian Army with necessary spare parts. Involves complex logistical and contractual considerations typical of international military sales.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition.
Foreign Military Sales can involve complex, less transparent pricing.
Contract duration is substantial (1155 days).

Positive Signals

Firm fixed-price contract provides cost certainty.
Supports a key U.S. ally.
Includes essential spare parts for sustainment.

Sector Analysis

This contract falls under the 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' sector. Spending in this niche area is often characterized by high unit costs and specialized production, with significant government oversight required for FMS procurements.

Small Business Impact

There is no indication that small businesses were involved in this specific contract, as it was awarded to a single, likely large, prime contractor, Textron Systems Corp. The nature of specialized defense manufacturing often favors established large businesses.

Oversight & Accountability

Oversight is critical for FMS contracts to ensure fair pricing and adherence to terms. The Department of Defense, specifically the Department of the Army, is responsible for managing this contract, with accountability to both U.S. taxpayers and the Colombian government.

Related Government Programs

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

Risk Flags

Sole-source award
Foreign Military Sales complexity
Potential for cost overruns without competition
Dependence on a single contractor
Geopolitical risks associated with the recipient nation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.6 million to TEXTRON SYSTEMS CORP. THIS ACTION IS IN SUPPORT OF FOREIGN MILITARY SALES (FMS) CASE CO-B-VFX FOR THE COUNTRY OF COLOMBIA BASED ON THE LETTER OF OFFER AND ACCEPTANCE (LOA) IMPLEMENTED 6 AUGUST 2012. THE REQUIREMENT PROVIDES FOR THE PROCUREMENT OF 28 EACH COMMANDO ADVANCED ARMORED PERSONNEL CARRIERS (APCS), DEPROCESSING, REPAIR OF TWO STRUCTURALLY DAMAGED ARMORED SECURITY VEHICLES (ASVS), AND SPARE PARTS FOR THE COLOMBIAN ARMY (COLAR).

Who is the contractor on this award?

The obligated recipient is TEXTRON SYSTEMS CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $31.6 million.

What is the period of performance?

Start: 2013-07-31. End: 2016-09-28.

What was the justification for the sole-source award, and how was the price determined to be fair and reasonable without competition?

The justification for a sole-source award in FMS cases typically stems from unique capabilities, specific national requirements, or existing platform integration needs. Price reasonableness is usually determined through government cost analysis, comparison to similar domestic procurements, or negotiation based on established pricing agreements, though transparency can be limited.

What are the specific risks associated with providing armored vehicles to Colombia under FMS, beyond pricing?

Risks include potential misuse of equipment, diversion to unauthorized actors, or challenges in ensuring proper maintenance and training. Geopolitical stability in the region and the recipient nation's internal security situation are also factors. Furthermore, end-use monitoring is crucial to ensure compliance with FMS agreements.

How does this contract contribute to the overall effectiveness of the Colombian Army's operations?

The acquisition of 28 Command Advanced Armored Personnel Carriers (APCs) directly enhances the Colombian Army's mobility, force protection, and operational capacity in various terrains and threat environments. The inclusion of spare parts ensures the long-term operational readiness and sustainability of these critical assets.

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 AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W56HZV12R0650

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Textron Inc (UEI: 001338979)

Address: 19401 CHEF MENTEUR HWY, NEW ORLEANS, LA, 70129

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $31,604,097

Exercised Options: $31,604,097

Current Obligation: $31,604,097

Subaward Activity

Number of Subawards: 56

Total Subaward Amount: $11,257,712

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline