DoD awards Oshkosh Defense $803M for HEMTTS, PLS Trailers, and parts, with no competition
Contract Overview
Contract Amount: $803,244,485 ($803.2M)
Contractor: Oshkosh Defense LLC
Awarding Agency: Department of Defense
Start Date: 2009-09-25
End Date: 2013-05-31
Contract Duration: 1,344 days
Daily Burn Rate: $597.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: THE PURPOSE OF THIS DELIVERY ORDER 0018 IS TO PURCHASE THE FOLLOWING: 1094 HEMTTS NEW, 1025 HEMTTS RESET, 181 CBT'S NEW, 84 M1076 PLS TRAILORS, 1025 MISSING PARTS FOR RESET, 33 DRAW BAR EXTENSION, 60 DRAW BAR KIT, AND 60 INSTALLATION.
Place of Performance
Location: OSHKOSH, WINNEBAGO County, WISCONSIN, 54902
Plain-Language Summary
Department of Defense obligated $803.2 million to OSHKOSH DEFENSE LLC for work described as: THE PURPOSE OF THIS DELIVERY ORDER 0018 IS TO PURCHASE THE FOLLOWING: 1094 HEMTTS NEW, 1025 HEMTTS RESET, 181 CBT'S NEW, 84 M1076 PLS TRAILORS, 1025 MISSING PARTS FOR RESET, 33 DRAW BAR EXTENSION, 60 DRAW BAR KIT, AND 60 INSTALLATION. Key points: 1. Significant investment in heavy tactical vehicle platforms (HEMTTS, PLS Trailers) and associated parts/services. 2. Sole reliance on Oshkosh Defense LLC for these critical components raises concerns about long-term pricing and innovation. 3. The duration of the contract (over 3 years) suggests a substantial operational need for these vehicles. 4. Lack of competition indicates potential for higher costs and limited market responsiveness.
Value Assessment
Rating: questionable
The total award of over $803 million for a variety of vehicle components and services appears substantial. Without competitive benchmarks or detailed cost breakdowns, it's difficult to definitively assess value. However, the lack of competition suggests potential overpricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Oshkosh Defense LLC. This limits price discovery and negotiation leverage for the government, potentially leading to higher costs than a competitive process would yield.
Taxpayer Impact: The absence of competition means taxpayers may be paying a premium for these essential military vehicle components and services.
Public Impact
Ensures continued operational readiness for Army units relying on HEMTTS and PLS trailer systems. Supports the sustainment and modernization of a significant portion of the Army's tactical wheeled vehicle fleet. Potential for extended reliance on a single manufacturer, impacting future procurement strategies. Job creation and economic activity within Oshkosh Defense LLC's supply chain.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price negotiation.
- High contract value warrants close scrutiny.
- Potential for vendor lock-in.
- Lack of transparency in pricing due to no competition.
Positive Signals
- Addresses critical equipment needs for the Department of the Army.
- Ensures operational capability through parts and reset services.
- Long-term contract provides stability for sustainment.
Sector Analysis
The defense sector, particularly vehicle manufacturing, often involves complex systems and long production cycles. Spending benchmarks for similar large-scale vehicle procurements and sustainment contracts can vary widely based on technology, quantity, and specific requirements. This award falls within the significant spending typical for major defense equipment.
Small Business Impact
There is no indication in the provided data that small businesses were involved in this contract, either as prime contractors or subcontractors. The award went directly to Oshkosh Defense LLC, a large prime contractor.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight to ensure fair pricing and contract compliance. The Department of the Army should actively monitor performance, costs, and delivery schedules to mitigate risks associated with non-competitive procurement.
Related Government Programs
- Truck Trailer Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award
- Lack of price competition
- Potential for inflated costs
- Limited transparency
- Risk of vendor lock-in
Tags
truck-trailer-manufacturing, department-of-defense, wi, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $803.2 million to OSHKOSH DEFENSE LLC. THE PURPOSE OF THIS DELIVERY ORDER 0018 IS TO PURCHASE THE FOLLOWING: 1094 HEMTTS NEW, 1025 HEMTTS RESET, 181 CBT'S NEW, 84 M1076 PLS TRAILORS, 1025 MISSING PARTS FOR RESET, 33 DRAW BAR EXTENSION, 60 DRAW BAR KIT, AND 60 INSTALLATION.
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 $803.2 million.
What is the period of performance?
Start: 2009-09-25. End: 2013-05-31.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves factors like unique capabilities, urgent needs, or lack of viable alternatives. Without further documentation, it's unclear why this contract was not competed. The Army should have explored options like full-and-open competition or other competitive procedures to ensure the best value for taxpayers, unless specific exceptions applied.
How does the per-unit cost of these HEMTTS and PLS trailer components compare to industry benchmarks or previous procurements?
Benchmarking the per-unit cost is challenging without access to detailed pricing data and historical procurement information. Given the sole-source nature, there's a heightened risk that costs may exceed competitive levels. A thorough cost analysis by the agency is crucial to validate the reasonableness of the pricing against available market data or similar government contracts.
What is the long-term strategy for procuring these vehicle components, and will future requirements be subject to competition?
The long-term strategy is unclear from this data. It is imperative that the Department of the Army plans for future procurements to be competitive whenever feasible. Relying on sole-source contracts repeatedly can stifle innovation and lead to sustained higher costs. A clear roadmap for competitive sourcing should be established.
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: $803,244,485
Exercised Options: $803,244,485
Current Obligation: $803,244,485
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W56HZV09D0024
IDV Type: IDC
Timeline
Start Date: 2009-09-25
Current End Date: 2013-05-31
Potential End Date: 2013-05-31 12:05:00
Last Modified: 2016-11-08
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