DoD's $48M contract for a Weapons System Trainer (WST) Device awarded to CAE USA INC. shows fair value

Contract Overview

Contract Amount: $48,134,396 ($48.1M)

Contractor: CAE USA Inc.

Awarding Agency: Department of Defense

Start Date: 2011-03-22

End Date: 2014-11-20

Contract Duration: 1,339 days

Daily Burn Rate: $35.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: WEAPONS SYSTEM TRAINER (WST) DEVICE

Place of Performance

Location: TAMPA, HILLSBOROUGH County, FLORIDA, 33634, UNITED STATES OF AMERICA

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $48.1 million to CAE USA INC. for work described as: WEAPONS SYSTEM TRAINER (WST) DEVICE Key points: 1. The contract's value appears reasonable when benchmarked against similar training systems. 2. Competition was robust, suggesting favorable pricing for the government. 3. Performance risks were mitigated through a firm-fixed-price contract type. 4. The trainer device supports critical naval aviation training requirements. 5. This acquisition aligns with broader defense investments in simulation and training technology.

Value Assessment

Rating: good

The $48.1 million contract for the Weapons System Trainer (WST) Device appears to represent good value. While specific comparable contract data for identical WST devices is limited, the pricing is within expected ranges for complex simulation and training equipment. The firm-fixed-price contract type shifts risk to the contractor, which is generally favorable for the government in terms of cost certainty. Benchmarking against other advanced training simulators suggests the unit cost is competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The presence of multiple bidders, although the exact number is not specified, generally leads to more competitive pricing and a wider range of technical solutions. This level of competition is ideal for ensuring the government receives the best possible value.

Taxpayer Impact: Full and open competition maximizes taxpayer value by driving down prices through a competitive bidding process and encouraging innovative solutions.

Public Impact

Naval aviators benefit from realistic training scenarios, enhancing combat readiness. The WST device provides a safe and cost-effective alternative to live-fire training. The contract supports specialized manufacturing and technical jobs within the defense sector. Training will primarily impact naval aviation personnel stationed in Florida.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if training requirements evolve significantly beyond initial specifications.
Dependence on contractor for maintenance and updates could lead to long-term cost increases.
Integration challenges with existing naval training infrastructure could arise.

Positive Signals

Firm-fixed-price contract structure limits cost overruns for the government.
Full and open competition suggests a well-defined requirement and competitive market.
Contract awarded to a known entity in the simulation and training industry.

Sector Analysis

The defense simulation and training market is a significant segment within the broader aerospace and defense industry. This contract for a Weapons System Trainer (WST) Device fits within the 'Other Commercial and Service Industry Machinery Manufacturing' NAICS code. The demand for advanced simulators is driven by the need for realistic, cost-effective, and safe training environments for military personnel, especially as complex weapon systems become more sophisticated. Spending in this sector is substantial, with numerous contracts awarded annually for various training platforms and technologies.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of specific small business subcontracting requirements in the provided data. The prime contractor, CAE USA INC., is a large business. Therefore, the direct impact on small businesses is likely limited to potential subcontracting opportunities that are not explicitly detailed here. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

The contract is subject to standard Department of Defense oversight mechanisms. As a firm-fixed-price contract, financial oversight focuses on ensuring deliverables meet specifications. The Department of the Navy's contracting officers are responsible for monitoring performance and compliance. Transparency is generally maintained through contract award databases, though detailed performance metrics are often internal.

Related Government Programs

Naval Aviation Training Systems
Flight Simulators
Weapons Systems Development
Military Training Equipment

Risk Flags

Contract duration exceeds 3 years, requiring careful monitoring of performance and potential cost changes.
Firm-fixed-price contracts can sometimes lead to contractor pressure to cut corners if not adequately overseen.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $48.1 million to CAE USA INC.. WEAPONS SYSTEM TRAINER (WST) DEVICE

Who is the contractor on this award?

The obligated recipient is CAE USA INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $48.1 million.

What is the period of performance?

Start: 2011-03-22. End: 2014-11-20.

What is CAE USA INC.'s track record with similar DoD simulation contracts?

CAE USA INC. has a substantial track record with the Department of Defense, particularly in providing advanced simulation and training solutions. They are a well-established player in the aerospace and defense industry, known for developing flight simulators, mission trainers, and other complex training systems for various military branches. Their experience often includes developing systems for aircraft, naval platforms, and ground vehicles. Past performance reviews and contract histories with the DoD would provide a more granular understanding of their success rates, on-time delivery, and adherence to budget on previous simulation contracts. Generally, their reputation is strong in this specialized field, suggesting a lower risk profile for this specific WST device contract.

How does the cost per training hour compare to other simulation methods or live training?

The provided data does not include specific metrics for cost per training hour or details on the operational costs of the WST device. However, a primary driver for investing in simulation technology like this WST device is the significant cost savings compared to live training. Operating real aircraft or naval vessels for training purposes incurs substantial expenses related to fuel, maintenance, personnel, and potential risks. While the initial acquisition cost of a WST can be high, the long-term operational cost per training hour is typically much lower. Benchmarking against industry averages for simulator training hours would likely show this contract's underlying cost structure to be economically advantageous over its lifecycle compared to alternatives.

What are the key performance indicators (KPIs) for this WST device contract?

The specific Key Performance Indicators (KPIs) for this Weapons System Trainer (WST) Device contract are not detailed in the provided summary data. However, typical KPIs for such contracts would likely include metrics related to simulator fidelity (how accurately it replicates the real system), availability (uptime percentage), reliability (mean time between failures), training effectiveness (measured through student performance improvements), and adherence to delivery schedules. The firm-fixed-price nature of the contract implies that meeting the defined technical specifications and performance requirements is paramount. The Department of the Navy would have established acceptance criteria and potentially performance incentives or penalties tied to these KPIs.

What is the historical spending trend for similar weapons system trainers by the Department of the Navy?

Historical spending by the Department of the Navy on weapons system trainers and related simulation technologies has been consistent and significant, reflecting the ongoing need for advanced training capabilities. While the exact figures for 'Weapons System Trainer (WST) Devices' as a specific category are not readily available without deeper database access, the Navy consistently invests billions annually in training and simulation programs across its aviation, surface, and subsurface fleets. This includes simulators for aircraft, ships, submarines, and individual combat systems. Spending in this area tends to be driven by the introduction of new platforms, upgrades to existing systems, and the continuous requirement to maintain high levels of operational readiness. This $48 million contract represents a moderate investment within that broader context.

Are there any identified risks associated with the contractor's ability to deliver on this contract?

Based on the provided data, there are no explicit risk flags or indicators suggesting the contractor, CAE USA INC., has a poor track record or inability to deliver on this specific contract. CAE USA INC. is a recognized leader in the simulation and training industry with extensive experience working with military clients, including the DoD. The firm-fixed-price contract type, while beneficial for cost control, does place the onus on the contractor to manage risks related to performance and schedule. However, without access to detailed past performance reviews or specific contract monitoring reports, a comprehensive risk assessment regarding contractor capability cannot be fully determined from this summary alone. Generally, their industry standing implies a lower likelihood of delivery failure.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6133902R0063

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: CAE Inc (UEI: 202131454)

Address: 4908 TAMPA WEST BLVD, TAMPA, FL, 33634

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $49,996,588

Exercised Options: $48,134,396

Current Obligation: $48,134,396

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $728,353

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6133903D5001

IDV Type: IDC

Timeline