DoD's $37.9M contract for 122 Thor HMPT transmissions awarded to L3 Technologies, Inc
Contract Overview
Contract Amount: $37,940,672 ($37.9M)
Contractor: L3 Technologies, Inc.
Awarding Agency: Department of Defense
Start Date: 2013-12-20
End Date: 2016-05-31
Contract Duration: 893 days
Daily Burn Rate: $42.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: UCA FOR 122 EA THOR HMPT 800 TRANSMISSION PLUS ANCILLARY HARDWARE.
Place of Performance
Location: MUSKEGON, MUSKEGON County, MICHIGAN, 49442
State: Michigan Government Spending
Plain-Language Summary
Department of Defense obligated $37.9 million to L3 TECHNOLOGIES, INC. for work described as: UCA FOR 122 EA THOR HMPT 800 TRANSMISSION PLUS ANCILLARY HARDWARE. Key points: 1. High-value contract for specialized vehicle transmission parts. 2. Sole-source award raises questions about price discovery and competition. 3. Potential risk associated with single-vendor reliance for critical components. 4. Spending falls within the Motor Vehicle Transmission and Power Train Parts Manufacturing sector.
Value Assessment
Rating: questionable
The contract value of $37.9M for 122 units suggests a per-unit cost of approximately $311,000. Without specific benchmarks for these specialized transmissions, it's difficult to definitively assess value, but the lack of competition warrants scrutiny.
Cost Per Unit: $311,000 (estimated)
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery mechanisms and may lead to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The absence of competition for this significant expenditure could result in suboptimal pricing, impacting taxpayer funds.
Public Impact
Military vehicle readiness may depend on the availability of these specialized transmissions. Taxpayers may be overpaying due to the lack of competitive bidding. Future procurement strategies should consider fostering competition for such critical parts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- High per-unit cost (estimated)
Positive Signals
- Definitive contract awarded
- Specific product identified
Sector Analysis
This contract falls under the Motor Vehicle Transmission and Power Train Parts Manufacturing sector. Spending benchmarks for highly specialized military components like these are difficult to establish without direct comparisons, but the value is substantial.
Small Business Impact
There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. The award went to a large corporation, L3 Technologies, Inc.
Oversight & Accountability
The sole-source nature of this award suggests potential gaps in oversight regarding competitive sourcing. Further review is needed to understand why this was not competed.
Related Government Programs
- Motor Vehicle Transmission and Power Train Parts Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing due to lack of competition.
- Supply chain risk associated with single vendor.
- High estimated per-unit cost requires validation.
Tags
motor-vehicle-transmission-and-power-tra, department-of-defense, mi, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $37.9 million to L3 TECHNOLOGIES, INC.. UCA FOR 122 EA THOR HMPT 800 TRANSMISSION PLUS ANCILLARY HARDWARE.
Who is the contractor on this award?
The obligated recipient is L3 TECHNOLOGIES, 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 $37.9 million.
What is the period of performance?
Start: 2013-12-20. End: 2016-05-31.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. Without specific documentation, it's impossible to confirm the exact reason, but it's a critical factor in assessing the value and necessity of this contract.
What are the risks associated with relying on a single supplier for these critical transmission components?
Sole-source reliance creates significant risks, including supply chain vulnerability, potential for price gouging, and lack of innovation. If L3 Technologies faces production issues or decides to discontinue the product, the Department of Defense could face severe operational disruptions and be forced into even less competitive future procurements.
How does the per-unit cost compare to similar, albeit potentially less specialized, transmission systems?
Direct comparison is challenging due to the specialized nature of the 'Thor HMPT 800 Transmission'. However, an estimated per-unit cost of $311,000 is exceptionally high for transmission systems. Benchmarking against high-end commercial heavy-duty transmissions, even with military-grade enhancements, would likely reveal a significant premium, underscoring the need for competitive pricing validation.
Industry Classification
NAICS: Manufacturing › Motor Vehicle Parts Manufacturing › Motor Vehicle Transmission and Power Train Parts Manufacturing
Product/Service Code: VEHICULAR EQUIPMENT COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W56HZV14R0036
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: L-3 Communications Holdings, Inc. (UEI: 008898843)
Address: 76 GETTY ST, MUSKEGON, MI, 49442
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $42,897,391
Exercised Options: $37,940,672
Current Obligation: $37,940,672
Subaward Activity
Number of Subawards: 1575
Total Subaward Amount: $190,145,411
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2013-12-20
Current End Date: 2016-05-31
Potential End Date: 2017-10-04 12:10:00
Last Modified: 2016-06-06
More Contracts from L3 Technologies, Inc.
- 63 Each of the Following Hardware Items for the Bradley Fighting Vehicle System (bfvs): Thor Hmpt 800HP Reman Transmission, NSN 2520-01-626-5061 TCM Electronic Assembly, NSN 2520-01-627-6468 Shift Tower, NSN 2520-01-465-5184 TEC Cable, NSN 6150-01-631-6134 — $456.5M (Department of Defense)
- Purchase of 538 EA E-Rovers — $401.1M (Department of Defense)
- Federal Contract — $395.7M (Department of Defense)
- CEC System Production and Repair — $315.9M (Department of Defense)
- Undersea Warfare Training Range (uswtr) Program Requirements Will Provide the Capability for Undersea Warfare (USW) Training and Assessment in Shallow Water and Deep Water Under Adverse Conditions for AIR, Surface, and Subsurface Forces — $267.9M (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)