Department of Defense awards $476M for HEMMTTA4 variants and PLS trailers to Oshkosh Defense LLC

Contract Overview

Contract Amount: $476,012,847 ($476.0M)

Contractor: Oshkosh Defense LLC

Awarding Agency: Department of Defense

Start Date: 2009-02-19

End Date: 2013-04-30

Contract Duration: 1,531 days

Daily Burn Rate: $310.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: D.O. 0005 IS FOR THE PROCUREMENT OF DIFFERENT HEMMTTA4 VARIANTS AND PLS TRAILERS.

Place of Performance

Location: OSHKOSH, WINNEBAGO County, WISCONSIN, 54902

State: Wisconsin Government Spending

Plain-Language Summary

Department of Defense obligated $476.0 million to OSHKOSH DEFENSE LLC for work described as: D.O. 0005 IS FOR THE PROCUREMENT OF DIFFERENT HEMMTTA4 VARIANTS AND PLS TRAILERS. Key points: 1. Contract awarded to a single, established supplier, raising questions about competitive pricing. 2. The firm-fixed-price contract type aims to control costs, but the lack of competition may limit savings. 3. Long contract duration (1531 days) suggests a significant, ongoing need for these specialized vehicles. 4. The procurement falls under Truck Trailer Manufacturing (NAICS 336212), a niche but critical defense sector. 5. Awarded by the Department of the Army, this contract supports tactical vehicle fleet readiness.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to the sole-source nature and the specialized equipment. Without competitive bids, it's difficult to ascertain if the $476 million represents optimal value for money. The firm-fixed-price structure provides cost certainty for the government, but the absence of competition could lead to higher prices than a competed procurement might achieve. Further analysis would require comparing unit costs to similar, previously procured variants or market research on comparable heavy-duty tactical vehicles.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis to Oshkosh Defense LLC. The data indicates no other bidders were considered. This approach is typically used when a specific product or capability is required from a single provider, often due to proprietary technology, existing system integration, or unique performance requirements. The lack of competition means the government did not benefit from a bidding process that could drive down prices through market forces.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as there is no competitive pressure to ensure the lowest possible price. This limits the government's ability to leverage market competition for cost savings.

Public Impact

The primary beneficiaries are the U.S. Army units requiring robust tactical vehicles for logistics and transport. Services delivered include the procurement of HEMMTTA4 variants and PLS trailers, essential for battlefield mobility. The geographic impact is national, supporting Army operations across various deployment locations. Workforce implications are primarily within Oshkosh Defense's manufacturing facilities, supporting skilled labor in Wisconsin.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices.
Sole-source award limits opportunities for other manufacturers.
Long-term reliance on a single supplier could create vendor lock-in.

Positive Signals

Firm-fixed-price contract provides cost certainty.
Award to an established defense contractor suggests reliability.
Procurement addresses critical military logistical needs.

Sector Analysis

This contract falls within the heavy truck and trailer manufacturing sector, a critical component of the defense industrial base. The market for specialized military vehicles is often characterized by limited players due to high barriers to entry, stringent performance requirements, and long development cycles. Oshkosh Defense is a significant incumbent in this space. Comparable spending benchmarks would involve analyzing other large-scale tactical vehicle procurements by the Department of Defense.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for small businesses based on the sole-source award to a large prime contractor. The primary impact is on the large prime, Oshkosh Defense. Without specific subcontracting plans detailed, the direct benefit to the small business ecosystem from this particular award is likely minimal.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management offices. Accountability measures are inherent in the firm-fixed-price structure, which shifts cost risk to the contractor. Transparency is limited by the sole-source nature of the award, though contract modifications and performance reports would be subject to internal review and potentially Inspector General oversight if performance issues arise.

Related Government Programs

Tactical Wheeled Vehicles
Logistics Support Vehicles
Heavy Equipment Transport
Military Truck Procurement
Defense Vehicle Manufacturing

Risk Flags

Sole-source award lacks competitive pricing pressure.
Potential for higher costs to taxpayers.
Limited transparency due to non-competitive nature.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $476.0 million to OSHKOSH DEFENSE LLC. D.O. 0005 IS FOR THE PROCUREMENT OF DIFFERENT HEMMTTA4 VARIANTS AND PLS TRAILERS.

Who is the contractor on this award?

The obligated recipient is OSHKOSH DEFENSE 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 $476.0 million.

What is the period of performance?

Start: 2009-02-19. End: 2013-04-30.

What is the historical spending pattern for HEMMTTA4 variants and PLS trailers with Oshkosh Defense?

Analyzing historical spending requires access to a broader dataset of past contracts. However, the current award of $476 million suggests a significant, multi-year investment in these specific vehicle variants. Without prior contract data, it's difficult to establish a trend, but the substantial value indicates a consistent and critical need for these assets within the Army's fleet. Future spending would likely depend on fleet modernization plans, operational tempo, and the lifecycle of existing vehicles. A review of previous delivery orders or contracts for similar equipment would be necessary to identify any patterns of increasing or decreasing investment.

How does the unit cost of these HEMMTTA4 variants and PLS trailers compare to market rates or similar government procurements?

Direct comparison of unit costs is challenging without specific unit pricing data and a clear understanding of the exact variants and configurations procured under this $476 million contract. Furthermore, the sole-source nature of the award means there was no competitive bidding process to establish a market-driven price. To benchmark effectively, one would need to identify comparable government contracts for similar heavy tactical vehicles, ideally those that were competitively awarded. Additionally, market research into the commercial heavy-duty truck and trailer industry could provide a baseline, though military-specific requirements often command a premium due to enhanced durability, mobility, and specialized features.

What are the key performance indicators (KPIs) used to assess the success of this contract?

Key performance indicators for a contract of this nature typically revolve around delivery schedules, quality of manufactured vehicles, and adherence to technical specifications. For the HEMMTTA4 variants and PLS trailers, KPIs would likely include on-time delivery of vehicles, successful completion of acceptance testing, and compliance with all military standards and requirements (e.g., survivability, mobility, payload capacity). The firm-fixed-price contract structure incentivizes the contractor to meet these performance metrics within the agreed budget. Performance reports and acceptance documentation would serve as the primary means of tracking adherence to these KPIs.

What is Oshkosh Defense's track record with Department of Defense contracts, particularly for tactical vehicles?

Oshkosh Defense LLC has a long-standing and extensive track record of supplying tactical wheeled vehicles to the U.S. Department of Defense. They are a primary provider of various vehicle families, including the Family of Heavy Tactical Vehicles (FHTV), which encompasses the HEMTT (Heavy Expanded Mobility Tactical Truck) and PLS (Palletized Load System) platforms. Their history includes numerous large-scale contracts for these and other military vehicles, often awarded through competitive processes, though sole-source awards for specific variants or upgrades are also common. Their performance is generally viewed as reliable, though like any large defense contractor, they have experienced contract modifications, delivery adjustments, and scrutiny over pricing and production timelines.

What are the potential risks associated with a sole-source award for such a significant procurement?

The primary risk associated with a sole-source award of this magnitude is the potential for inflated pricing due to the absence of competitive pressure. Without competing bids, the government may pay more than it would in a fully competed scenario. Another risk is vendor lock-in, where the government becomes heavily reliant on a single supplier, potentially limiting future flexibility and negotiation power. There's also a risk that innovation might be slower compared to a market with multiple competing firms actively seeking to differentiate their offerings. Finally, sole-source awards can face greater public and congressional scrutiny regarding justification and value for money.

Industry Classification

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

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

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: Oshkosh Corp (UEI: 006070445)

Address: 2307 OREGON ST, OSHKOSH, WI, 54903

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: $476,012,847

Exercised Options: $476,012,847

Current Obligation: $476,012,847

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56HZV09D0024

IDV Type: IDC

Timeline