DoD awards $68.4M for 99 transmissions to Allison Transmission Inc., a sole-source contract
Contract Overview
Contract Amount: $68,390,188 ($68.4M)
Contractor: Allison Transmission Inc
Awarding Agency: Department of Defense
Start Date: 2014-04-15
End Date: 2016-12-31
Contract Duration: 991 days
Daily Burn Rate: $69.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DO 0032 IS TO PROCURE THE 99 TRANSMISSIONS FOR UCA AWARD W56HZV08D0159 P00026.
Place of Performance
Location: INDIANAPOLIS, MARION County, INDIANA, 46222
State: Indiana Government Spending
Plain-Language Summary
Department of Defense obligated $68.4 million to ALLISON TRANSMISSION INC for work described as: DO 0032 IS TO PROCURE THE 99 TRANSMISSIONS FOR UCA AWARD W56HZV08D0159 P00026. Key points: 1. The contract value is substantial at $68.4 million for 99 transmissions. 2. Allison Transmission Inc. is the sole awardee, indicating a lack of competition. 3. The firm fixed price contract type aims to control costs. 4. The procurement falls under Motor Vehicle Body Manufacturing (NAICS 336211).
Value Assessment
Rating: fair
The total award is $68.4 million for 99 units. Without specific unit pricing or comparison data, it's difficult to definitively assess value. However, the average price per unit is approximately $690,971.
Cost Per Unit: $690,971
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Allison Transmission Inc. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition for this significant procurement may result in taxpayers paying more than if the contract had been competitively bid.
Public Impact
Military readiness may depend on the timely delivery of these critical transmission components. The sole-source nature of the award raises questions about cost-effectiveness for taxpayers. Dependence on a single supplier could pose supply chain risks. The contract duration spans over two years, indicating a long-term need.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- High per-unit cost warrants further investigation.
- Potential for overpayment due to lack of competition.
Positive Signals
- Firm fixed price contract type helps control costs.
- Awardee is a known entity in transmission manufacturing.
Sector Analysis
This procurement falls within the Defense sector, specifically related to vehicle manufacturing. Spending benchmarks for specialized vehicle components can vary widely, but the sole-source nature here is a key factor.
Small Business Impact
There is no indication that small businesses were involved in this procurement, as it was a sole-source award to a large, established company.
Oversight & Accountability
The sole-source nature of this award suggests limited oversight on price competition. Further review of the justification for sole-sourcing would be necessary to assess accountability.
Related Government Programs
- Motor Vehicle Body Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award
- High per-unit cost
- Lack of competition
- Potential for cost overruns
- Supply chain dependency
Tags
motor-vehicle-body-manufacturing, department-of-defense, in, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $68.4 million to ALLISON TRANSMISSION INC. DO 0032 IS TO PROCURE THE 99 TRANSMISSIONS FOR UCA AWARD W56HZV08D0159 P00026.
Who is the contractor on this award?
The obligated recipient is ALLISON TRANSMISSION INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $68.4 million.
What is the period of performance?
Start: 2014-04-15. End: 2016-12-31.
What was the justification for awarding this contract on a sole-source basis, and were alternative solutions considered?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs that only one vendor can meet. Without access to the specific contract file, it's impossible to determine the exact reasoning. However, the Department of Defense is expected to thoroughly document and justify such decisions to ensure they are in the best interest of the government and taxpayers.
How does the per-unit cost of these transmissions compare to commercially available or previously procured similar units?
The per-unit cost of approximately $690,971 is exceptionally high. A thorough benchmark analysis against commercial equivalents and historical government procurements of similar transmissions is crucial. Significant deviations from market rates would indicate potential overpricing, especially given the sole-source nature of this award.
What are the potential risks associated with relying on a single supplier for these critical transmission components?
Relying on a single supplier, like Allison Transmission Inc. in this case, creates significant supply chain risks. These include potential production delays, price increases due to lack of competition, and vulnerability to the supplier's business disruptions (e.g., labor issues, financial instability, or natural disasters). This dependence could impact military operational readiness if supply is interrupted.
Industry Classification
NAICS: Manufacturing › Motor Vehicle Body and Trailer Manufacturing › Motor Vehicle Body Manufacturing
Product/Service Code: VEHICULAR EQUIPMENT COMPONENTS
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: Allison Transmission Inc. (UEI: 969132880)
Address: ONE ALLISON WAY, INDIANAPOLIS, IN, 46222
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: $68,390,188
Exercised Options: $68,390,188
Current Obligation: $68,390,188
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W56HZV08D0159
IDV Type: IDC
Timeline
Start Date: 2014-04-15
Current End Date: 2016-12-31
Potential End Date: 2016-12-31 12:12:00
Last Modified: 2018-10-24
More Contracts from Allison Transmission Inc
- Federal Contract — $167.9M (Department of Defense)
- First Order of Abrams Transmissions in Support of CY24 — $97.4M (Department of Defense)
- CY26 (delivery Order Year 3) for Abrams Transmission LTC — $95.1M (Department of Defense)
- Abrams Transmission - Allison Transmission CY 2021 PM Abrams and Ilsc Delivery Order — $91.6M (Department of Defense)
- Delivery Order for Abrams Transmissions — $91.0M (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)