DoD's $37M MRAP Vehicle Contract Awarded to General Dynamics with 10 Bidders

Contract Overview

Contract Amount: $37,000,902 ($37.0M)

Contractor: General Dynamics Land Systems - Canada Corporation

Awarding Agency: Department of Defense

Start Date: 2010-07-15

End Date: 2013-04-30

Contract Duration: 1,020 days

Daily Burn Rate: $36.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 10

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CATEGORY II MRAP VEHICLE

Place of Performance

Location: LANSING, INGHAM County, MICHIGAN, 48901

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $37.0 million to GENERAL DYNAMICS LAND SYSTEMS - CANADA CORPORATION for work described as: CATEGORY II MRAP VEHICLE Key points: 1. The contract value of $37 million represents a significant investment in armored vehicle capabilities. 2. Full and open competition suggests a healthy market for MRAP vehicles, potentially leading to competitive pricing. 3. The award to General Dynamics Land Systems - Canada Corporation indicates a strong incumbent or competitive player in the defense sector. 4. The contract duration of 1020 days (approximately 2.8 years) suggests a substantial, ongoing need for these vehicles. 5. The fixed-price contract type aims to control costs and provide predictability for the government. 6. The absence of small business set-asides indicates the primary focus was on specialized capabilities rather than small business participation.

Value Assessment

Rating: good

The contract value of $37 million for MRAP vehicles appears reasonable given the specialized nature of military hardware. Benchmarking against similar contracts for armored vehicles would provide a clearer picture of value for money. The firm fixed-price structure helps mitigate cost overruns for the government, which is a positive indicator for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with 10 bidders participating. This level of competition is generally positive, suggesting that multiple capable vendors were interested and able to bid, which can drive down prices and encourage innovation. The presence of numerous bidders indicates a robust market for these types of vehicles.

Taxpayer Impact: The extensive competition for this contract likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition scenario. It ensures that the Department of Defense is receiving competitive market rates for essential military equipment.

Public Impact

The primary beneficiaries are the U.S. Department of Defense, specifically the Department of the Navy, receiving critical armored vehicle support. The contract delivers Category II MRAP vehicles, essential for troop protection in high-threat environments. The geographic impact is primarily within the defense supply chain and potentially deployment locations, though specific deployment details are not provided. Workforce implications include employment within General Dynamics' manufacturing facilities and its supply chain partners.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for reliance on a single large contractor, General Dynamics, could limit future competition if not managed.
The specific 'Category II' designation implies a need for specialized components and manufacturing expertise, potentially limiting broader small business involvement.
Geopolitical factors or supply chain disruptions could impact delivery timelines and costs for specialized vehicle components.

Positive Signals

Awarded under full and open competition, indicating a healthy and competitive market for MRAP vehicles.
Firm fixed-price contract type provides cost certainty for the government, mitigating financial risks.
The contract duration suggests a sustained commitment to equipping forces with necessary protection, indicating strategic planning.

Sector Analysis

The defense sector, particularly military vehicle manufacturing, is characterized by high barriers to entry due to technological complexity, stringent quality standards, and significant capital investment. This contract for MRAP vehicles falls within the broader 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' industry. Spending in this area is driven by evolving battlefield needs and the imperative to protect military personnel. Comparable spending benchmarks would involve analyzing other large-scale procurements of armored personnel carriers and tactical vehicles by various defense agencies.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The primary contractor, General Dynamics Land Systems - Canada Corporation, is a large entity. While large prime contracts can sometimes include subcontracting opportunities for small businesses, the absence of a specific set-aside suggests that the focus was on securing the most capable provider for this specialized equipment, rather than prioritizing small business participation directly through the award mechanism.

Oversight & Accountability

Oversight for this Department of Defense contract would typically involve contract officers, program managers, and potentially the Defense Contract Management Agency (DCMA). Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified vehicles. Transparency is generally maintained through contract databases like FPDS, though detailed performance metrics may not always be publicly disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Mine-Resistant Ambush Protected (MRAP) Vehicles
Tactical Wheeled Vehicles
Department of Defense Vehicle Procurement
Armored Vehicle Manufacturing
Military Vehicle Contracts

Risk Flags

Supply Chain Vulnerability
Cost Overruns (mitigated by FFP)
Delivery Delays
Technological Obsolescence (for older MRAP variants)

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.0 million to GENERAL DYNAMICS LAND SYSTEMS - CANADA CORPORATION. CATEGORY II MRAP VEHICLE

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS LAND SYSTEMS - CANADA CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $37.0 million.

What is the period of performance?

Start: 2010-07-15. End: 2013-04-30.

What is the historical spending trend for MRAP vehicles by the Department of Defense?

Historical spending on MRAP vehicles by the Department of Defense has been substantial, particularly following the increased demand during the conflicts in Iraq and Afghanistan. The MRAP program was initiated to address the high number of casualties from roadside bombs. Over the years, billions of dollars have been allocated to the procurement, sustainment, and upgrade of various MRAP variants. While initial procurement surged, spending has since shifted towards sustainment, modernization, and the development of next-generation protected mobility platforms. Analyzing FPDS data reveals significant annual expenditures, with peaks during active combat operations and subsequent declines as operational needs evolved and newer vehicle platforms were introduced or considered. The $37 million awarded in this specific contract represents a portion of this ongoing investment in protected mobility.

How does the per-unit cost of these MRAP vehicles compare to industry benchmarks or similar contracts?

Determining the precise per-unit cost for this specific contract is challenging without knowing the exact number of vehicles procured under the $37 million award. However, MRAP vehicles are complex, highly specialized military assets, and their cost per unit can vary significantly based on the specific variant, configuration, and included technologies. Historically, MRAP units have ranged from several hundred thousand dollars to over a million dollars each. Factors such as armor protection levels, integrated electronics, communication systems, and mobility features all contribute to the final price. Without the quantity of vehicles, a direct per-unit comparison is speculative. However, the overall contract value suggests a significant procurement, and the competitive nature of the award implies that the pricing was vetted against market expectations for such specialized defense equipment.

What is General Dynamics Land Systems - Canada Corporation's track record with MRAP vehicles and similar defense contracts?

General Dynamics Land Systems (GDLS) has a significant and established track record in the defense sector, including extensive experience with armored vehicle production. They were a key player in the original MRAP program, producing various variants and contributing to the rapid fielding of these critical vehicles. GDLS has a long history of manufacturing tanks, armored personnel carriers, and other military ground vehicles for the U.S. and allied nations. Their experience encompasses design, engineering, manufacturing, and sustainment of complex defense systems. Awards like this one for MRAP vehicles are consistent with their core capabilities and market position. Their performance on previous large-scale defense contracts, including those involving armored vehicles, is generally well-documented, though specific performance metrics on individual contracts are not always publicly detailed.

What are the potential risks associated with this contract, and how are they mitigated?

Potential risks for this contract include supply chain disruptions for specialized components, potential cost overruns if the firm fixed-price structure proves inadequate for unforeseen issues (though this is less likely with fixed-price), and performance or delivery delays. Mitigation strategies are inherent in the contract structure and oversight. The firm fixed-price nature shifts much of the cost risk to the contractor. The full and open competition process likely selected a contractor with a proven ability to manage these risks. Furthermore, the Department of Defense employs contract officers and program managers to monitor progress, ensure compliance with specifications, and address any emerging issues proactively. The duration of the contract also allows for phased delivery and performance monitoring.

How does this contract fit into the broader strategy of the Department of the Navy for armored vehicle modernization?

This contract for Category II MRAP vehicles likely fits into the Department of the Navy's ongoing strategy to ensure its forces are equipped with appropriate levels of protection against modern threats. While MRAPs were initially fielded in response to specific threats in Iraq and Afghanistan, their utility in various operational environments persists. The Navy, like other branches of the military, continuously evaluates its ground vehicle fleet to balance protection, mobility, and operational requirements. Procurements like this one may represent either continued sustainment of existing MRAP fleets, upgrades to enhance capabilities, or potentially the acquisition of specific variants needed for particular naval expeditionary roles. It reflects a commitment to providing survivable platforms for personnel operating in potentially hazardous conditions.

Industry Classification

NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: M6785407R5000

Offers Received: 10

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 1991 OXFORD ST E BLDG 15, LONDON

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $37,000,902

Exercised Options: $37,000,902

Current Obligation: $37,000,902

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: M6785407D5028

IDV Type: IDC

Timeline