DoD's $16M YBFDAC Repair Contract Awarded to Sumitomo Heavy Industries
Contract Overview
Contract Amount: $15,991,738 ($16.0M)
Contractor: Sumitomo Heavy Industries, Ltd
Awarding Agency: Department of Defense
Start Date: 2008-10-07
End Date: 2009-05-08
Contract Duration: 213 days
Daily Burn Rate: $75.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: PROJECT MANAGEMENT FOR FY09 REPAIRS AND ALTERATIONS FOR THE YBFDAC
Plain-Language Summary
Department of Defense obligated $16.0 million to SUMITOMO HEAVY INDUSTRIES, LTD for work described as: PROJECT MANAGEMENT FOR FY09 REPAIRS AND ALTERATIONS FOR THE YBFDAC Key points: 1. Contract value of $15.99M for FY09 repairs and alterations. 2. Awarded to Sumitomo Heavy Industries, Ltd. 3. Full and open competition was utilized. 4. The contract type is Cost Plus Award Fee (CPAF).
Value Assessment
Rating: fair
The contract value of $15.99M for ship repairs and alterations appears within a reasonable range for such specialized work. Benchmarking against similar naval repair contracts would provide a clearer picture of its competitiveness.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a robust price discovery process. This method typically leads to more competitive pricing by allowing all qualified vendors to bid.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and improve service quality.
Public Impact
Ensures operational readiness of naval assets through necessary repairs. Supports the shipbuilding and repair sector, contributing to industry capacity. Potential for cost overruns inherent in Cost Plus Award Fee contracts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee contract type can incentivize cost overruns.
- Short contract duration (213 days) may limit long-term planning benefits.
- No specific small business participation noted.
Positive Signals
- Full and open competition utilized.
- Awarded for essential repairs and alterations.
- Clear start and end dates provided.
Sector Analysis
This contract falls within the shipbuilding and repair sector, which is critical for maintaining naval fleet capabilities. Spending in this area is often driven by defense needs and the lifecycle of existing vessels.
Small Business Impact
The data indicates that small business participation was not a specific set-aside or requirement for this contract. Further analysis would be needed to determine if any small businesses were involved as subcontractors.
Oversight & Accountability
The Department of the Navy, under the Department of Defense, is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms would apply to ensure proper execution and accountability.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Cost Plus Award Fee contract type.
- No specific small business participation noted.
- Short contract duration.
- Potential for cost overruns.
Tags
ship-building-and-repairing, department-of-defense, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.0 million to SUMITOMO HEAVY INDUSTRIES, LTD. PROJECT MANAGEMENT FOR FY09 REPAIRS AND ALTERATIONS FOR THE YBFDAC
Who is the contractor on this award?
The obligated recipient is SUMITOMO HEAVY INDUSTRIES, LTD.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $16.0 million.
What is the period of performance?
Start: 2008-10-07. End: 2009-05-08.
What is the typical profit margin for Cost Plus Award Fee contracts in naval shipbuilding and repair?
Cost Plus Award Fee (CPAF) contracts typically include a base fee and an award fee. The base fee is a percentage of the estimated cost, while the award fee is earned based on performance against pre-defined criteria. Profit margins can vary but are generally designed to incentivize contractor performance while allowing for reasonable profit, often in the range of 10-15% total fee, depending on performance.
How does the short contract duration impact the overall cost-effectiveness of these repairs?
A short contract duration of 213 days for repairs and alterations might necessitate expedited work, potentially increasing labor costs or requiring overtime. While it ensures timely completion of urgent tasks, it could also limit opportunities for more thorough, cost-saving analyses or phased approaches that might be possible with a longer timeframe.
What are the potential risks associated with Sumitomo Heavy Industries' performance on this contract?
Potential risks include performance delays, cost overruns due to the CPAF structure, or quality issues in the repairs. Given the specialized nature of naval vessel repairs, ensuring the contractor possesses the necessary expertise and adheres to stringent quality standards is crucial for mitigating these risks.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N6264904R0051
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Sumitomo Heavy Industries, Ltd. (UEI: 690536396)
Address: 19, NATSUSHIMACHO, YOKOSUKA
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $15,991,738
Exercised Options: $15,991,738
Current Obligation: $15,991,738
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N6264905D0002
IDV Type: IDC
Timeline
Start Date: 2008-10-07
Current End Date: 2009-05-08
Potential End Date: 2009-05-08 00:00:00
Last Modified: 2009-08-17
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