DoD's FMTV RESET Program awarded $20.5M to BAE Systems for vehicle body manufacturing in Texas

Contract Overview

Contract Amount: $20,532,258 ($20.5M)

Contractor: BAE Systems Tactical Vehicle Systems LP

Awarding Agency: Department of Defense

Start Date: 2008-09-26

End Date: 2009-09-30

Contract Duration: 369 days

Daily Burn Rate: $55.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: FMTV RESET PROGRAM

Place of Performance

Location: SEALY, COLORADO County, TEXAS, 77474

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $20.5 million to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP for work described as: FMTV RESET PROGRAM Key points: 1. The contract value of $20.5M for vehicle body manufacturing appears to be a significant investment in military readiness. 2. BAE Systems, a major defense contractor, secured this award through full and open competition. 3. The contract duration of 369 days suggests a focused effort on a specific reset phase. 4. The award was made by the Department of the Army, indicating a direct need within ground forces. 5. The North American Industry Classification System (NAICS) code 336211 points to the specific manufacturing sector involved. 6. The fixed-price contract type likely provides cost certainty for the government, though it shifts risk to the contractor.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more granular data on the number and type of vehicles reset. However, the $20.5 million award for a reset program of this nature suggests a substantial investment. Comparing it to other reset programs or new vehicle acquisitions would provide better context for value for money. The firm fixed-price nature indicates a defined cost expectation, but the ultimate value depends on the scope and quality of the reset work performed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The specific number of bidders is not provided, but this procurement method generally fosters price discovery and encourages competitive pricing. The government likely received a range of proposals, allowing for selection of the best value based on technical merit and cost.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it is expected to drive down costs through market forces and increase the likelihood of receiving competitive pricing.

Public Impact

The primary beneficiaries are the U.S. Army ground forces who will receive reset vehicles, enhancing their operational readiness. The services delivered include the manufacturing of vehicle bodies as part of the FMTV reset program. The geographic impact is primarily in Texas, where BAE Systems Tactical Vehicle Systems LP is located. Workforce implications include employment opportunities at BAE Systems' Texas facility, supporting skilled manufacturing jobs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the number of vehicles reset and the scope of work makes it difficult to fully assess value for money.
The firm fixed-price contract, while providing cost certainty, could lead to contractor cost-cutting if not adequately monitored, potentially impacting quality.
Limited information on the competitive landscape (number of bidders) prevents a deeper analysis of price competitiveness.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
BAE Systems is a well-established defense contractor with experience in vehicle manufacturing and reset programs.
The contract addresses a critical need for resetting existing military vehicles, contributing to readiness.
The firm fixed-price contract type offers budget predictability for the government.

Sector Analysis

The defense manufacturing sector, specifically focusing on tactical vehicle production and sustainment, is a critical component of national security. This contract falls within the broader motor vehicle body manufacturing industry (NAICS 336211). The market for military vehicle sustainment and reset programs is substantial, driven by the ongoing need to maintain and modernize aging fleets. Comparable spending benchmarks would involve analyzing other reset contracts for similar vehicle platforms or new vehicle procurements within the Department of Defense.

Small Business Impact

This contract does not indicate any specific small business set-aside provisions (ss: false, sb: false). Therefore, small businesses are unlikely to be direct recipients of this prime contract. However, BAE Systems, as a large prime contractor, may engage small businesses as subcontractors for components or specialized services, though this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army contracting and program management offices. Accountability measures would be tied to the contract's performance requirements, delivery schedules, and quality standards. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Family of Medium Tactical Vehicles (FMTV)
Tactical Vehicle Sustainment Programs
Department of Defense Vehicle Procurement
Military Vehicle Reset Programs

Risk Flags

Potential for quality compromise under fixed-price contract if not adequately overseen.
Lack of detailed scope of work and quantity makes value assessment difficult.
Limited information on number of bidders hinders competition analysis.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.5 million to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP. FMTV RESET PROGRAM

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $20.5 million.

What is the period of performance?

Start: 2008-09-26. End: 2009-09-30.

What is the historical spending pattern for the FMTV RESET PROGRAM?

The provided data indicates a single award of $20,532,258.49 for the FMTV RESET PROGRAM to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP, with an award date of 2008-09-26 and an end date of 2009-09-30. This suggests that this specific contract represents a discrete funding action within a potentially larger or ongoing reset initiative. To understand the broader historical spending pattern, one would need to examine contract awards across multiple fiscal years for the 'FMTV RESET PROGRAM' or similar designations, looking at the total obligated amounts, number of awards, and prime contractors involved. Without access to a comprehensive contract database search for this specific program over time, it's difficult to establish a trend or recurring spending cycle. This single award suggests a specific, time-bound reset effort rather than continuous, year-over-year funding for the same program designation.

How does the per-unit cost of this reset program compare to market rates or similar contracts?

Determining a precise per-unit cost for this FMTV RESET PROGRAM contract is not feasible with the provided data. The contract value is $20.5 million, and the number of vehicles reset is not specified. The Family of Medium Tactical Vehicles (FMTV) encompasses various truck configurations, each with potentially different reset costs. To perform a meaningful comparison, we would need to know the exact quantity and types of FMTV variants that underwent resetting under this contract. Furthermore, 'market rates' for military vehicle reset services are not publicly standardized. Comparisons would ideally be made against other government contracts for FMTV reset or reset programs for similar tactical vehicles, analyzing the cost per vehicle based on the scope of work (e.g., refurbishment, repair, component replacement). Without this granular detail, any per-unit cost calculation would be speculative and lack a reliable benchmark.

What is BAE Systems' track record with similar vehicle reset or manufacturing contracts?

BAE Systems has a significant and extensive track record in defense manufacturing, including the production and sustainment of tactical vehicles. They are a major producer of the Family of Medium Tactical Vehicles (FMTV) for the U.S. Army, having previously manufactured these vehicles. Their experience extends to reset, refurbishment, and upgrade programs for various military platforms. This includes work on armored vehicles, combat vehicles, and logistics support vehicles. Given their established role as a prime contractor for the FMTV platform, BAE Systems possesses the institutional knowledge, manufacturing capabilities, and supply chain integration necessary for executing vehicle reset programs effectively. Their long-standing relationship with the Department of Defense and specific experience with the FMTV line suggest a strong capability to fulfill contracts of this nature.

What are the key performance indicators (KPIs) typically used to measure the success of a vehicle reset program like this?

Key performance indicators (KPIs) for a vehicle reset program like the FMTV RESET PROGRAM typically focus on readiness, cost, schedule, and quality. Readiness is often measured by the percentage of vehicles returned to service that meet operational availability standards and the reduction in maintenance backlog. Cost KPIs include adherence to the contract budget, cost savings achieved through efficient processes, and the total cost of ownership over the vehicle's lifecycle. Schedule KPIs involve meeting delivery timelines for reset vehicles and minimizing program delays. Quality KPIs are crucial and include metrics such as the defect rate of reset vehicles, the reliability of components replaced or refurbished, and customer satisfaction (e.g., feedback from deploying units). Ensuring that reset vehicles perform as expected in operational environments is the ultimate measure of success.

What is the potential risk associated with the firm fixed-price contract type for this program?

The primary risk associated with a firm fixed-price (FFP) contract for a vehicle reset program like this lies in the potential for the contractor, BAE Systems, to cut corners on quality or scope to protect their profit margin if unforeseen issues arise during the reset process. While FFP contracts offer cost certainty to the government, they place the burden of cost overruns on the contractor. If the actual cost of resetting the vehicles exceeds BAE's estimates (due to unexpected wear, complex repairs, or supply chain issues), they might be incentivized to reduce the quality of work or the extent of refurbishment to maintain profitability. Robust government oversight, clear technical specifications, and stringent quality assurance processes are essential to mitigate this risk and ensure that the reset vehicles meet all required operational standards.

How does the geographic location of the contractor (Texas) impact logistics and costs for this DoD contract?

The geographic location of BAE Systems Tactical Vehicle Systems LP in Texas can have several implications for this Department of Defense contract. Firstly, it establishes a specific point of origin for the reset vehicles, potentially influencing transportation costs and timelines for delivery back to Army depots or units. If the vehicles are reset in Texas and then need to be shipped to distant operational bases or training areas, these logistics costs become a factor. Secondly, the concentration of defense manufacturing in certain regions, including Texas, can provide access to a skilled workforce and established supply chains, potentially leading to efficiencies. However, it could also mean higher labor costs compared to regions with lower costs of living. The specific impact on logistics and costs would depend on the location of the vehicles prior to reset and their final destination after completion, as well as the availability and cost of specialized labor and materials in the Texas region.

Industry Classification

NAICS: Manufacturing › Motor Vehicle Body and Trailer Manufacturing › Motor Vehicle Body Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 5000 INTERSTATE HWY 10 W, SEALY, TX, 10

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

Financial Breakdown

Contract Ceiling: $20,532,258

Exercised Options: $20,532,258

Current Obligation: $20,532,258

Contract Characteristics

Multi-Year Contract: Yes

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56HZV08D0138

IDV Type: IDC

Timeline