Department of Defense awards $144.7M contract for wheeled combat vehicles to Oshkosh Corp

Contract Overview

Contract Amount: $144,676,548 ($144.7M)

Contractor: Oshkosh Corp

Awarding Agency: Department of Defense

Start Date: 2006-06-01

End Date: 2008-03-27

Contract Duration: 665 days

Daily Burn Rate: $217.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIXED PRICE

Sector: Defense

Official Description: 200609!500142!1700!M67854!COMMANDING GENERAL !M6785404D5016 !A!N! !N!0029 ! !20060601!20080331!006070445!006070445!006070445!N!OSHKOSH TRUCK CORP !2307 OREGON ST !OSHKOSH !WI!54902!60500!139!55!OSHKOSH !WINNEBAGO !WISCONSIN !+000092961700!N!N!000756400000!2320!TRUCKS AND TRUCK TRACTORS, WHEELED !A4A!COMBAT VEHICLES !000 !NOT DISCERNABLE !336120!E! !3!C!S! ! !D!20100101!B! ! !A! !C!U!J!1!001!N!1B!A!W!F! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! !1727!M67854!0001! !

Place of Performance

Location: OSHKOSH, WINNEBAGO County, WISCONSIN, 54903

State: Wisconsin Government Spending

Plain-Language Summary

Department of Defense obligated $144.7 million to OSHKOSH CORP for work described as: 200609!500142!1700!M67854!COMMANDING GENERAL !M6785404D5016 !A!N! !N!0029 ! !20060601!20080331!006070445!006070445!006070445!N!OSHKOSH TRUCK CORP !2307 OREGON ST !OSHKOSH !WI!54902!60500!139!55!OSHKOSH !WINN… Key points: 1. Contract awarded for wheeled combat vehicles, indicating a focus on tactical mobility and protection. 2. The award to Oshkosh Corp. suggests a reliance on established defense contractors with proven manufacturing capabilities. 3. A fixed-price contract type implies that the government has a clear understanding of the scope and cost, transferring some risk to the contractor. 4. The contract duration of 665 days suggests a moderate-term need for these specialized vehicles. 5. The North American Industry Classification System (NAICS) code 336120 points to the manufacturing of heavy trucks, aligning with the product type. 6. The contract was not competed, raising questions about potential cost efficiencies and market exploration.

Value Assessment

Rating: fair

The total award amount of $144,676,548 for 217559 units results in a per-unit cost of approximately $66.50. This figure appears exceptionally low for combat vehicles, suggesting it may represent a component or a specific type of vehicle not fully detailed in the provided data. Without further context on the specific vehicle model, quantity, and included features, a direct comparison to similar contracts is difficult. However, if this represents a fully equipped combat vehicle, the price would be significantly below market rates, potentially indicating a favorable negotiation or a misunderstanding of the scope.

Cost Per Unit: Approximately $66.50 per unit (based on total award and unit count, requires further context for validation)

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other potential suppliers. This approach is typically used when a specific contractor possesses unique capabilities, proprietary technology, or when there is an urgent need that cannot be met through a competitive process. The lack of competition means that the government did not benefit from the price discovery and innovation that typically arise from multiple bidders vying for the contract.

Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying a premium for goods or services, as the absence of competition limits the government's leverage in price negotiations.

Public Impact

The primary beneficiaries of this contract are the U.S. military forces requiring advanced wheeled combat vehicles for operational deployment. The contract delivers specialized vehicles designed for combat environments, enhancing troop mobility, survivability, and mission effectiveness. The geographic impact is primarily national, supporting defense readiness across various military branches and potentially overseas deployments. Workforce implications include job creation and sustainment within Oshkosh Corp. and its supply chain, particularly in manufacturing and engineering roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source awards can limit opportunities for innovative solutions from smaller or emerging companies.
Dependence on a single supplier could create supply chain vulnerabilities.

Positive Signals

Oshkosh Corp. is a known entity in defense manufacturing, suggesting a degree of reliability and expertise.
The contract specifies a clear product (wheeled combat vehicles), indicating a defined need being met.
Fixed-price contract type can provide cost certainty for the government.

Sector Analysis

The defense manufacturing sector is characterized by high barriers to entry, significant R&D investment, and long product development cycles. Contracts for combat vehicles are a critical component of this sector, supporting national security objectives. Spending in this area is often driven by evolving threats and the need for technological superiority. Comparable spending benchmarks would typically involve multi-year procurement programs for armored personnel carriers, infantry fighting vehicles, or specialized support vehicles, often in the hundreds of millions or billions of dollars.

Small Business Impact

This contract does not appear to have a small business set-aside. As a sole-source award to a large prime contractor, there is a potential for limited subcontracting opportunities for small businesses unless specifically mandated by the prime. The impact on the small business ecosystem would depend on Oshkosh Corp.'s subcontracting plan and whether they actively seek out and engage small business suppliers for components or services.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management offices. Accountability measures would include performance reviews, quality assurance checks, and adherence to contract terms. Transparency might be limited due to the sole-source nature, but contract awards are generally reported in federal procurement databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Tactical Wheeled Vehicles
Combat Vehicle Procurement
Armored Vehicle Manufacturing
Defense Logistics Agency Contracts
Army Ground Vehicle Programs

Risk Flags

Sole-source award may limit price competition.
Unit cost requires further clarification to assess value.
Specific vehicle model and capabilities not detailed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $144.7 million to OSHKOSH CORP. 200609!500142!1700!M67854!COMMANDING GENERAL !M6785404D5016 !A!N! !N!0029 ! !20060601!20080331!006070445!006070445!006070445!N!OSHKOSH TRUCK CORP !2307 OREGON ST !OSHKOSH !WI!54902!60500!139!55!OSHKOSH !WINNEBAGO !WISCONSIN !+000092961700!N!N!000756400000!2320!TRUCKS AND TRUCK TRACTORS, WHEELED !A4A!COMBAT VEHICLES !000 !NOT DISCERNABLE !336120!E! !3!C!S! ! !D!201

Who is the contractor on this award?

The obligated recipient is OSHKOSH CORP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $144.7 million.

What is the period of performance?

Start: 2006-06-01. End: 2008-03-27.

What specific type of wheeled combat vehicle is being procured under this contract?

The provided data indicates the contract is for 'TRUCKS AND TRUCK TRACTORS, WHEELED' under NAICS code 336120, with a specific application noted as 'COMBAT VEHICLES'. However, the exact model or configuration of the wheeled combat vehicle is not explicitly detailed. Given the awardee, Oshkosh Corp., known for producing the Joint Light Tactical Vehicle (JLTV) and other heavy-duty military trucks, it is plausible this contract relates to such platforms or specialized variants. Further clarification would be needed to identify the precise vehicle type and its intended role within the military.

How does the per-unit cost of approximately $66.50 compare to market rates for similar combat vehicles?

The calculated per-unit cost of approximately $66.50 is extraordinarily low for any type of combat vehicle, including trucks. For context, even basic tactical trucks can cost tens of thousands of dollars, while armored personnel carriers or infantry fighting vehicles can range from hundreds of thousands to millions of dollars each. This discrepancy strongly suggests that the 'unit' count of 217,559 may not represent complete, operational vehicles, but rather components, spare parts, or a very specific, low-cost sub-assembly. Without a clear definition of what constitutes a 'unit' in this contract, a meaningful market comparison is not possible.

What are the potential risks associated with awarding this contract on a sole-source basis?

The primary risk of a sole-source award is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may not achieve the best possible price. Additionally, sole-source contracts can stifle innovation by excluding other capable companies that might offer more advanced or cost-effective solutions. There's also a risk of vendor lock-in, where the government becomes overly reliant on a single supplier, potentially leading to future vulnerabilities in supply or pricing. Finally, it raises concerns about whether the government adequately explored all available options before deciding against a competitive process.

What is Oshkosh Corp.'s track record in manufacturing defense vehicles?

Oshkosh Corp. has a significant and established track record in manufacturing defense vehicles. They are well-known for producing the Joint Light Tactical Vehicle (JLTV), which has become a cornerstone of the U.S. military's light tactical fleet, replacing many older Humvees. Oshkosh also manufactures other heavy-duty military trucks, including cargo trucks, wreckers, and specialized platforms. Their long history and extensive experience in the defense sector suggest a high level of capability, reliability, and understanding of military requirements, making them a frequent and trusted supplier for the Department of Defense.

What does the contract duration of 665 days imply about the program's urgency or complexity?

A contract duration of 665 days, approximately 22 months, suggests a moderate-term requirement for the delivery of these wheeled combat vehicles or related services. It is not indicative of an immediate, short-term emergency need, nor does it represent a multi-year, large-scale strategic procurement. This duration implies a planned acquisition process, allowing for phased production, testing, and delivery. The complexity is likely moderate, involving manufacturing and integration of systems, but perhaps not the extensive R&D or full-scale deployment associated with longer-duration, higher-value programs.

Are there any indications of performance issues or quality concerns related to Oshkosh Corp.'s previous defense contracts?

Based on the provided data alone, there are no direct indications of performance issues or quality concerns specifically tied to this contract or Oshkosh Corp. The data points to a standard award with a fixed-price contract type. However, like any large defense contractor, Oshkosh Corp. may have faced scrutiny or challenges on other contracts over its history. A comprehensive assessment would require reviewing contract performance reports, past performance evaluations, and any official findings from oversight bodies like the Government Accountability Office (GAO) or the DoD Inspector General related to their broader portfolio of defense contracts.

Industry Classification

NAICS: Manufacturing › Engine, Turbine, and Power Transmission Equipment Manufacturing › Turbine and Turbine Generator Set Units Manufacturing

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2307OREGON STREET, OSHKOSH, WI, 54903

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: M6785404D5016

IDV Type: IDC

Timeline