DoD's $39M MK80 Bomb Body Series contract awarded to General Dynamics, a sole-source procurement

Contract Overview

Contract Amount: $39,071,951 ($39.1M)

Contractor: General Dynamics Ordnance and Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2013-06-05

End Date: 2015-01-31

Contract Duration: 605 days

Daily Burn Rate: $64.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MK80 BOMB BODY SERIES

Place of Performance

Location: GARLAND, DALLAS County, TEXAS, 75040, UNITED STATES OF AMERICA

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $39.1 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC. for work described as: MK80 BOMB BODY SERIES Key points: 1. The contract value of $39 million for bomb bodies represents a significant investment in munitions. 2. Sole-source procurement raises questions about potential price inflation and lack of competitive pressure. 3. The duration of 605 days suggests a substantial production run or a critical supply chain need. 4. The fixed-price contract type aims to control costs, but the absence of competition limits benchmarking. 5. Awarded to General Dynamics Ordnance and Tactical Systems, Inc., this contract highlights a key defense contractor's role. 6. The contract falls under Ammunition (except Small Arms) Manufacturing, a critical defense industrial base sector.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature. Without competitive bids, it's difficult to ascertain if the $39 million represents a fair market price for the MK80 bomb bodies. Comparisons to similar sole-source procurements in the defense sector might offer some context, but the lack of open competition inherently limits the ability to assess value for money effectively. The fixed-price contract type is a positive indicator for cost control, but the overall value proposition is obscured by the procurement method.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source procurement method, meaning only one bidder was solicited. This approach is typically used when there are unique capabilities or urgent needs that cannot be met by multiple sources. The lack of competition means that taxpayers did not benefit from the price discovery that typically occurs in a competitive bidding process. It also limits the government's ability to negotiate the best possible price.

Taxpayer Impact: The sole-source award means taxpayers may have paid a premium compared to what could have been achieved through open competition. This limits the efficient use of defense funds.

Public Impact

The primary beneficiaries are the Department of Defense, specifically the Department of the Army, ensuring a supply of critical munitions. The services delivered include the manufacturing of MK80 bomb bodies, essential components for aerial ordnance. The geographic impact is primarily within Texas, where General Dynamics Ordnance and Tactical Systems, Inc. is located. Workforce implications include employment at the contractor's facility in Texas, supporting the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Lack of transparency in the procurement process due to single-bidder solicitation.
Potential for contractor lock-in, reducing future negotiation leverage.
Limited visibility into alternative manufacturing capabilities or cost-saving innovations.

Positive Signals

Fixed-price contract type helps to establish a ceiling on costs.
Award to an established defense contractor suggests a degree of reliability in production.
Ensures a critical supply of munitions for military operations.

Sector Analysis

The defense sector, particularly the manufacturing of munitions, is characterized by high barriers to entry, specialized technology, and significant government oversight. The market for bomb bodies is likely concentrated among a few key defense contractors due to the stringent requirements and security protocols involved. This contract for MK80 bomb bodies fits within the broader category of ordnance manufacturing, a critical component of the defense industrial base. Spending in this area is driven by military readiness requirements and geopolitical factors.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no explicit information regarding subcontracting plans for small businesses. The sole-source nature of the award further reduces opportunities for small businesses to participate directly or indirectly through subcontracting, potentially limiting their engagement within this specific procurement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and auditing functions. As a sole-source award, there may be heightened scrutiny from agencies like the Government Accountability Office (GAO) or the Department of Defense's Inspector General (IG) to ensure the justification for sole-sourcing is sound and the pricing is reasonable. Transparency is limited by the procurement method, but contract performance and payment would be subject to standard government oversight.

Related Government Programs

MK80 Series General Purpose Bombs
Ammunition Manufacturing Contracts
Department of Defense Ordnance Procurement
General Dynamics Defense Contracts

Risk Flags

Sole-source procurement
Lack of competitive bidding
Potential for price escalation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $39.1 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC.. MK80 BOMB BODY SERIES

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, 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 $39.1 million.

What is the period of performance?

Start: 2013-06-05. End: 2015-01-31.

What is the historical spending trend for MK80 bomb bodies or similar munitions by the Department of the Army?

Analyzing historical spending for MK80 bomb bodies or similar munitions by the Department of the Army requires access to detailed procurement databases and contract award histories. While this specific contract is for $39 million, understanding the broader trend involves looking at prior awards for the same or comparable items over several fiscal years. Factors such as changes in military doctrine, operational tempo, and budget allocations significantly influence these spending patterns. Without specific historical data points for this contract vehicle or its predecessors, it's difficult to establish a precise trend. However, general defense spending on munitions tends to fluctuate based on global security environments and strategic priorities, often showing sustained investment in core capabilities like bomb bodies.

How does the unit cost of the MK80 bomb bodies under this contract compare to industry benchmarks or previous contracts?

Determining the precise unit cost for the MK80 bomb bodies under this $39 million contract is not possible without knowing the exact quantity awarded. However, given the sole-source nature of this procurement, a direct comparison to competitive market benchmarks or previous contracts is inherently difficult. Sole-source awards often lack the price transparency that competitive bidding provides. If previous contracts for these bomb bodies were competitively awarded, their pricing could serve as a reference point. Industry benchmarks for similar ordnance components, if available and comparable, might offer a broader perspective. However, the absence of competitive data makes a definitive value-for-money assessment challenging, suggesting potential for higher unit costs than in a competitive scenario.

What specific justification was provided for awarding this contract on a sole-source basis?

The justification for awarding this contract on a sole-source basis would typically stem from specific circumstances outlined in federal acquisition regulations (FAR). Common reasons include the existence of only one responsible source capable of fulfilling the requirement, urgent and compelling needs where delays associated with competitive bidding would be detrimental to national security, or when the supplies/services are unique and only available from a single source. For defense articles like bomb bodies, this could relate to proprietary manufacturing processes, specialized tooling, or critical national defense requirements that only a specific contractor can meet. A formal justification document, often requiring higher-level approval, would detail these reasons and demonstrate why competition is not feasible or not in the government's best interest.

What is the track record of General Dynamics Ordnance and Tactical Systems, Inc. in fulfilling similar defense manufacturing contracts?

General Dynamics Ordnance and Tactical Systems, Inc. (GD-OTS) has a significant and established track record in defense manufacturing, including the production of ordnance and munitions. They are a major supplier to the U.S. military and allied nations, producing a wide range of products such as mortar systems, artillery shells, and bomb components. Their experience likely includes fulfilling large-scale, complex contracts under demanding timelines and quality standards. While specific performance metrics for every contract are not publicly detailed, their continued role as a prime contractor for the Department of Defense suggests a history of successful program execution and reliability in delivering critical defense materiel. This background provides a degree of confidence in their capability to produce the MK80 bomb bodies.

Are there any identified risks associated with the performance or delivery of these MK80 bomb bodies by the selected contractor?

Risks associated with the performance and delivery of MK80 bomb bodies by General Dynamics Ordnance and Tactical Systems, Inc. could include supply chain disruptions for raw materials, potential production delays due to unforeseen manufacturing issues, or quality control challenges inherent in complex ordnance production. Given the sole-source nature, there's also a risk of cost overruns if initial pricing assumptions prove inaccurate, although the firm-fixed-price contract type aims to mitigate this. Furthermore, geopolitical events or changes in military requirements could impact the demand or specifications for these bomb bodies. The government's oversight mechanisms, including quality assurance surveillance plans and contract management, are designed to identify and mitigate these risks proactively.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

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: General Dynamics Corp (UEI: 001381284)

Address: 1200 N GLENBROOK DR, GARLAND, TX, 75040

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

Financial Breakdown

Contract Ceiling: $77,846,981

Exercised Options: $39,071,951

Current Obligation: $39,071,951

Contract Characteristics

Multi-Year Contract: Yes

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W52P1J13D0050

IDV Type: IDC

Timeline