DoD awards $33.6M for M16A4 rifles to FN America LLC under full and open competition
Contract Overview
Contract Amount: $33,638,721 ($33.6M)
Contractor: FN America LLC
Awarding Agency: Department of Defense
Start Date: 2007-12-21
End Date: 2010-04-30
Contract Duration: 861 days
Daily Burn Rate: $39.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 9
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MANUFACTURE OF M16A4 RIFLES
Place of Performance
Location: COLUMBIA, RICHLAND County, SOUTH CAROLINA, 29229
Plain-Language Summary
Department of Defense obligated $33.6 million to FN AMERICA LLC for work described as: MANUFACTURE OF M16A4 RIFLES Key points: 1. FN America LLC secured a significant contract for M16A4 rifle manufacturing. 2. The contract was awarded through full and open competition, suggesting a competitive bidding process. 3. The firm fixed price contract type aims to control costs for the Department of Defense. 4. The spending falls within the 'Small Arms, Ordnance, and Ordnance Accessories Manufacturing' sector.
Value Assessment
Rating: good
The contract value of $33.6M appears reasonable for the specified period and quantity of M16A4 rifles. Benchmarking against similar defense procurement contracts for small arms would provide a more precise assessment.
Cost Per Unit: $38,999.80
Competition Analysis
Competition Level: full-and-open
The award was made under full and open competition, indicating multiple bidders likely participated. This method generally promotes competitive pricing and ensures the government receives the best value.
Taxpayer Impact: The competitive nature of the award suggests taxpayers benefited from potentially lower prices than a sole-source or limited competition scenario.
Public Impact
Ensures continued supply of a standard-issue rifle for military personnel. Supports domestic manufacturing capabilities for small arms. The contract's duration and value indicate a substantial commitment to this weapon system.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for price increases in future contracts if competition diminishes.
- Dependence on a single manufacturer for a critical weapon system.
Positive Signals
- Awarded through full and open competition.
- Firm fixed price contract type.
- FN America LLC is a known and experienced defense contractor.
Sector Analysis
This contract falls within the defense manufacturing sector, specifically small arms. Spending in this area is critical for military readiness and is subject to rigorous oversight and competitive procurement processes.
Small Business Impact
The data indicates this contract was not awarded to small businesses, as FN America LLC is a large corporation. There is no specific indication of subcontracting opportunities for small businesses within this award.
Oversight & Accountability
The Department of Defense, through the Department of the Army, managed this procurement. Standard DoD oversight mechanisms for contract performance and financial accountability would apply.
Related Government Programs
- Small Arms, Ordnance, and Ordnance Accessories Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Contract duration of 861 days.
- Awarded to a single prime contractor.
- Potential for supply chain disruptions.
- Future procurement needs beyond this contract are not specified.
Tags
small-arms-ordnance-and-ordnance-accesso, department-of-defense, sc, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $33.6 million to FN AMERICA LLC. MANUFACTURE OF M16A4 RIFLES
Who is the contractor on this award?
The obligated recipient is FN AMERICA 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 $33.6 million.
What is the period of performance?
Start: 2007-12-21. End: 2010-04-30.
What is the long-term strategic value of maintaining domestic M16A4 production capacity?
Maintaining domestic production capacity for the M16A4 ensures a reliable supply chain for a critical military asset, reducing reliance on foreign sources and supporting national security objectives. It also preserves specialized manufacturing skills and jobs within the defense industrial base, contributing to economic stability and readiness.
What are the potential risks associated with a firm fixed price contract for firearms manufacturing?
A firm fixed price contract, while good for cost control, can pose risks if material costs or labor expenses unexpectedly surge beyond projections. The manufacturer bears the brunt of these cost overruns, potentially impacting their profitability or leading to quality compromises if margins become too thin. Conversely, the government might overpay if initial cost estimates were too high.
How effective is full and open competition in ensuring the best value for military rifle procurement?
Full and open competition is generally highly effective in ensuring the best value for military rifle procurement. It allows multiple qualified manufacturers to bid, driving down prices through market forces and encouraging innovation. This process typically leads to a wider range of options and ensures the government secures high-quality equipment at competitive rates, maximizing taxpayer return.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Small Arms, Ordnance, and Ordnance Accessories Manufacturing
Product/Service Code: WEAPONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 9
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Societ Herstalienne Pour LA Finance L'industrielle ET LE C
Address: 797 OLD CLEMSON RD, COLUMBIA, SC, 29229
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $33,638,721
Exercised Options: $33,638,721
Current Obligation: $33,638,721
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W52H0908D0121
IDV Type: IDC
Timeline
Start Date: 2007-12-21
Current End Date: 2010-04-30
Potential End Date: 2010-04-30 00:00:00
Last Modified: 2023-06-02
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