DoD awards $40.1M for MK80 Bomb Body Series, a sole-source contract to General Dynamics

Contract Overview

Contract Amount: $40,142,637 ($40.1M)

Contractor: General Dynamics Ordnance and Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2014-08-14

End Date: 2016-08-31

Contract Duration: 748 days

Daily Burn Rate: $53.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MK80 BOMB BODY SERIES, DELIVERY ORDER 0002

Place of Performance

Location: GARLAND, DALLAS County, TEXAS, 75040

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $40.1 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC. for work described as: MK80 BOMB BODY SERIES, DELIVERY ORDER 0002 Key points: 1. Significant contract value for a specific munitions component. 2. Sole-source award raises questions about competition and potential price inflation. 3. Risk associated with reliance on a single supplier for critical defense components. 4. Manufacturing sector for ammunition is specialized and has limited players.

Value Assessment

Rating: questionable

The contract value of $40.1M for bomb bodies is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar components from other manufacturers.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and may lead to higher costs for taxpayers as there was no competitive pressure to drive down prices.

Taxpayer Impact: The lack of competition on this $40.1M contract means taxpayers may have paid a premium, as the government did not leverage market forces to secure the best possible price.

Public Impact

Direct impact on military readiness and defense capabilities. Potential for job creation in the defense manufacturing sector in Texas. Taxpayer funds allocated to a critical but non-competed defense procurement.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Potential for price overruns

Positive Signals

Critical defense component
Established manufacturer

Sector Analysis

This contract falls within the defense manufacturing sector, specifically ammunition production. Spending benchmarks for such specialized components are hard to establish publicly due to security and proprietary information.

Small Business Impact

The contract was awarded to General Dynamics Ordnance and Tactical Systems, Inc., a large corporation. There is no indication that small businesses were involved in this specific delivery order, nor is there a stated set-aside.

Oversight & Accountability

As a sole-source award, oversight is crucial to ensure the contractor is meeting delivery schedules and quality standards. Transparency regarding the justification for the sole-source award is important for accountability.

Related Government Programs

Ammunition (except Small Arms) Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award limits price competition.
Potential for higher costs due to lack of competitive bidding.
Supply chain risk associated with single-source dependency.
Lack of transparency regarding justification for sole-source.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $40.1 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC.. MK80 BOMB BODY SERIES, DELIVERY ORDER 0002

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 $40.1 million.

What is the period of performance?

Start: 2014-08-14. End: 2016-08-31.

What is the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair pricing?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without access to the specific justification documentation, it's impossible to detail the steps taken to ensure fair pricing. However, agencies usually rely on historical pricing, independent government cost estimates, or certified cost or pricing data from the contractor.

What are the long-term risks associated with relying on a single supplier for critical bomb components like the MK80 series?

Long-term risks include supply chain vulnerability, potential for price gouging due to lack of competition, and reduced innovation. If the sole supplier faces production issues, faces bankruptcy, or decides to exit the market, the Department of Defense could face significant shortages and delays in acquiring essential munitions, impacting national security.

How does the lack of competition in this award affect the overall cost-effectiveness of the Department of Defense's munitions procurement strategy?

The lack of competition directly reduces cost-effectiveness. Competitive bidding typically drives down prices and encourages efficiency. Sole-source awards, while sometimes necessary, bypass this crucial market mechanism, potentially leading to higher unit costs and a less efficient allocation of taxpayer funds for munitions procurement.

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: $40,142,637

Exercised Options: $40,142,637

Current Obligation: $40,142,637

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W52P1J13D0050

IDV Type: IDC

Timeline