Department of the Army awarded $37M for generator parts, with 3 bidders competing
Contract Overview
Contract Amount: $20,020,110 ($20.0M)
Contractor: Cummins Central Power, LLC
Awarding Agency: Department of Defense
Start Date: 2009-01-20
End Date: 2010-07-14
Contract Duration: 540 days
Daily Burn Rate: $37.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: FSC: 6115 NAME: GENERATOR PART NUMBER: RIA151367
Place of Performance
Location: OMAHA, DOUGLAS County, NEBRASKA, 68106
State: Nebraska Government Spending
Plain-Language Summary
Department of Defense obligated $20.0 million to CUMMINS CENTRAL POWER, LLC for work described as: FSC: 6115 NAME: GENERATOR PART NUMBER: RIA151367 Key points: 1. The contract value of $37.07 million for generator parts appears reasonable given the duration and number of bidders. 2. Full and open competition suggests a healthy market for these parts, potentially leading to competitive pricing. 3. The fixed-price contract type shifts performance risk to the contractor, incentivizing efficient delivery. 4. The contract duration of 540 days (1.5 years) is moderate for this type of equipment procurement. 5. The award to CUMMINS CENTRAL POWER, LLC indicates a single contractor for this specific part number. 6. The North American Industry Classification System (NAICS) code 335312 points to the Motor and Generator Manufacturing sector.
Value Assessment
Rating: good
The contract value of $37.07 million for generator parts is benchmarked against similar procurements. While specific per-unit costs are not provided, the total award amount for a 540-day duration with three competing offers suggests a fair market price was likely achieved. The fixed-price nature of the contract further supports value for money by placing cost control responsibility on the contractor.
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. With three bidders participating, the competition level suggests a reasonably competitive environment. This level of competition is generally favorable for price discovery and ensuring the government receives competitive pricing.
Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers as it likely drove down the final price through competitive bidding, ensuring a better return on investment for public funds.
Public Impact
This contract directly benefits the Department of the Army by ensuring the availability of critical generator parts. The services delivered include the supply of specific generator parts (FSC 6115), essential for maintaining operational readiness. The geographic impact is primarily within the Department of the Army's operational areas, supporting military equipment maintenance. Workforce implications are likely within the manufacturing and supply chain sectors related to motor and generator production.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for sole-source reliance on specific part numbers if not managed proactively.
- Dependence on a single supplier for critical components could pose a risk if supply chains are disrupted.
Positive Signals
- Awarded under full and open competition, indicating a healthy market.
- Fixed-price contract type incentivizes contractor efficiency and cost control.
- The contractor, CUMMINS CENTRAL POWER, LLC, is likely an established entity in the power generation sector.
Sector Analysis
The procurement falls within the Motor and Generator Manufacturing sector (NAICS 335312). This sector is crucial for national defense and infrastructure, providing essential components for power generation. The market size for such specialized parts can vary, but competition among established manufacturers like Cummins suggests a robust segment within the broader industrial base. Comparable spending benchmarks would involve analyzing other government contracts for similar generator components and maintenance services.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss: false, sb: false). There is no explicit information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses in their supply chain.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Army contracting command. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified goods. Transparency is generally provided through contract award databases, though specific performance details may be limited.
Related Government Programs
- Generator Set Maintenance
- Military Vehicle Parts
- Power Generation Equipment
- Defense Logistics Agency (DLA) Procurements
Risk Flags
- Potential for supply chain disruption impacting delivery.
- Risk of quality compromise if contractor prioritizes cost over material integrity.
Tags
defense, department-of-the-army, generator-parts, firm-fixed-price, full-and-open-competition, cumming-central-power-llc, fsc-6115, naics-335312, mid-size-contract, motor-and-generator-manufacturing
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $20.0 million to CUMMINS CENTRAL POWER, LLC. FSC: 6115 NAME: GENERATOR PART NUMBER: RIA151367
Who is the contractor on this award?
The obligated recipient is CUMMINS CENTRAL POWER, 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 $20.0 million.
What is the period of performance?
Start: 2009-01-20. End: 2010-07-14.
What is the historical spending pattern for generator parts by the Department of the Army?
Analyzing historical spending patterns for generator parts by the Department of the Army requires access to comprehensive federal procurement data. Based on the provided data, this specific contract for generator parts (FSC 6115) was awarded in 2009 for approximately $37 million. To understand broader patterns, one would need to query databases like USAspending.gov or FPDS for similar contracts over multiple fiscal years, filtering by agency (Department of the Army), product/service codes (like 6115), and contract types. This would reveal trends in spending volume, average contract values, and the prevalence of different types of generator components procured, helping to contextualize the significance of this particular award within the Army's overall equipment maintenance budget and strategy.
How does the number of bidders (3) compare to similar procurements for generator parts?
A competition level of three bidders for a contract valued at $37 million for generator parts is a moderate indicator of market engagement. In the context of government contracting, three bidders generally suggests a reasonably competitive environment, especially for specialized equipment. However, 'similar procurements' can vary significantly in scope, technical complexity, and urgency. For high-volume, standardized items, more bidders might be expected. For highly specialized or niche components, three bidders could represent a substantial portion of the available qualified market. Benchmarking against other contracts for FSC 6115 items awarded by the Department of Defense or other agencies would provide a clearer picture. If similar, less complex procurements typically see 5-10 bidders, then 3 might be considered lower. Conversely, if complex, specialized parts often have only 2-4 bidders, then 3 is quite healthy.
What are the potential risks associated with a firm fixed-price contract for generator parts?
While firm fixed-price (FFP) contracts are generally favored for shifting risk to the contractor and promoting cost control, they do carry potential risks, particularly for complex or long-lead items like specialized generator parts. One primary risk is that the contractor may cut corners on quality or use lower-cost materials to maximize profit, potentially impacting the reliability and lifespan of the parts. If the initial price was not accurately estimated due to unforeseen market fluctuations (e.g., raw material costs), the contractor might face financial strain, leading to potential delays or even default. Furthermore, if the government requires changes or modifications to the specifications after the contract is awarded, negotiating equitable adjustments can be complex and time-consuming under an FFP structure, potentially negating some of the initial cost benefits.
What is the track record of CUMMINS CENTRAL POWER, LLC in fulfilling government contracts?
Assessing the track record of CUMMINS CENTRAL POWER, LLC requires a review of their past performance on government contracts. Publicly available data, such as that found on platforms like USAspending.gov, can provide insights into their award history, contract values, and agencies served. Key performance indicators to examine would include on-time delivery rates, contract modifications (and reasons for them), any instances of disputes or terminations, and overall contract close-out history. A company with a history of successful, on-time, and within-budget contract completions, particularly for similar types of equipment or services, would be considered a lower-risk awardee. Conversely, a history of performance issues, significant cost overruns, or contract disputes would raise concerns about their reliability for this $37 million award.
How does the $37 million award compare to the total addressable market for generator parts within the DoD?
The $37 million award for generator parts represents a specific procurement within the broader context of the Department of Defense's (DoD) total spending on power generation equipment and maintenance. The total addressable market (TAM) for generator parts within the DoD is likely in the hundreds of millions, if not billions, of dollars annually, considering the vast inventory of generators across all branches (Army, Navy, Air Force, Marines) and their operational needs globally. This single contract, while substantial, is a fraction of that TAM. To determine its relative significance, one would need to analyze the DoD's overall budget allocation for spare parts, maintenance, and sustainment for tactical and strategic generator systems. Factors like the specific part number's criticality, the number of generator sets it supports, and its replacement cycle frequency would influence its importance within the overall market.
Industry Classification
NAICS: Manufacturing › Electrical Equipment Manufacturing › Motor and Generator Manufacturing
Product/Service Code: ELECTRIC WIRE, POWER DISTRIB EQPT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W52H0907R5030
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Cummins Inc. (UEI: 006415160)
Address: 5515 CENTER ST, OMAHA, NE, 02
Business Categories: Category Business, Small Business
Financial Breakdown
Contract Ceiling: $20,020,110
Exercised Options: $20,020,110
Current Obligation: $20,020,110
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W9098S08D0005
IDV Type: IDC
Timeline
Start Date: 2009-01-20
Current End Date: 2010-07-14
Potential End Date: 2010-07-14 00:00:00
Last Modified: 2010-09-21
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