DoD Awards $78.4M for Generators to Cummins Power Generation Inc. in FY21

Contract Overview

Contract Amount: $78,376,300 ($78.4M)

Contractor: Cummins Power Generation Inc.

Awarding Agency: Department of Defense

Start Date: 2021-03-31

End Date: 2022-10-31

Contract Duration: 579 days

Daily Burn Rate: $135.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: AMMPS DELIVERY ORDER #0011 (FY 2021)

Place of Performance

Location: MINNEAPOLIS, ANOKA County, MINNESOTA, 55432

State: Minnesota Government Spending

Plain-Language Summary

Department of Defense obligated $78.4 million to CUMMINS POWER GENERATION INC. for work described as: AMMPS DELIVERY ORDER #0011 (FY 2021) Key points: 1. Significant award to a single large business vendor. 2. Focus on motor and generator manufacturing sector. 3. Potential for higher costs due to lack of competition. 4. Long contract duration of 579 days.

Value Assessment

Rating: fair

The award amount of $78.4 million for a delivery order is substantial. Without competitive bids, it's difficult to assess if this price is optimal compared to market rates for similar generator systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source or limited competition procurement. This lack of competition may have led to a higher price than could have been achieved through a competitive bidding process.

Taxpayer Impact: Taxpayer funds may have been spent at a non-optimal price due to the absence of competitive pressure.

Public Impact

Ensures critical power generation equipment for the Department of Defense. Supports a major manufacturer in the motor and generator industry. Potential impact on readiness if equipment is not cost-effectively procured.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
High dollar value
Sole-source award

Positive Signals

Essential equipment for defense operations
Award to established manufacturer

Sector Analysis

This spending falls within the Motor and Generator Manufacturing sector (NAICS 335312). Federal spending in this sector often supports defense, infrastructure, and energy needs. Benchmarks for similar large-scale generator procurements would be needed for a precise comparison.

Small Business Impact

The contract was awarded to Cummins Power Generation Inc., a large business. There is no indication that small businesses were involved as subcontractors or partners in this specific delivery order.

Oversight & Accountability

The award is a delivery order under a larger contract, suggesting some level of prior oversight. However, the lack of competition for this specific order warrants scrutiny to ensure fair pricing and value.

Related Government Programs

Motor and Generator Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Lack of competitive bidding
Potential for inflated pricing
Limited transparency on justification
No small business participation evident

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $78.4 million to CUMMINS POWER GENERATION INC.. AMMPS DELIVERY ORDER #0011 (FY 2021)

Who is the contractor on this award?

The obligated recipient is CUMMINS POWER GENERATION 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 $78.4 million.

What is the period of performance?

Start: 2021-03-31. End: 2022-10-31.

What was the justification for not competing this large delivery order?

The justification for not competing this delivery order is crucial for understanding the value proposition. Without a clear rationale, such as a sole-source justification based on unique capabilities or urgent need, it raises concerns about potential overpayment and missed opportunities for cost savings through competition.

How does the unit cost compare to similar generator systems procured competitively?

A direct comparison of unit costs is challenging without access to specific pricing data from competitive contracts for similar generator systems. However, the absence of competition suggests this price may be higher than what could have been achieved through a bidding process, potentially impacting overall cost-effectiveness.

What is the long-term impact of sole-source awards on defense procurement efficiency?

Sole-source awards, while sometimes necessary, can reduce overall procurement efficiency by eliminating competitive pressure that drives down prices and fosters innovation. Over-reliance on non-competed contracts may lead to higher costs and potentially slower adoption of new technologies, impacting the long-term modernization and cost-effectiveness of defense capabilities.

Industry Classification

NAICS: Manufacturing › Electrical Equipment Manufacturing › Motor and Generator Manufacturing

Product/Service Code: ELECTRIC WIRE, POWER DISTRIB EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Cummins Inc.

Address: 1400 73RD AVE NE, MINNEAPOLIS, MN, 55432

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

Financial Breakdown

Contract Ceiling: $78,376,300

Exercised Options: $78,376,300

Current Obligation: $78,376,300

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W909MY18D0033

IDV Type: IDC

Timeline