Department of Defense awards $74.6M contract for turbine generator sets to Oshkosh Corp
Contract Overview
Contract Amount: $74,590,938 ($74.6M)
Contractor: Oshkosh Corp
Awarding Agency: Department of Defense
Start Date: 2006-12-11
End Date: 2009-07-09
Contract Duration: 941 days
Daily Burn Rate: $79.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: TRACTORS
Place of Performance
Location: OSHKOSH, WINNEBAGO County, WISCONSIN, 54902
Plain-Language Summary
Department of Defense obligated $74.6 million to OSHKOSH CORP for work described as: TRACTORS Key points: 1. Contract awarded on a firm fixed-price basis, indicating clear cost expectations. 2. The contract was not competed, raising questions about potential price discovery. 3. Oshkosh Corp. is the sole awardee, suggesting a specific capability or relationship. 4. The contract duration was 941 days, spanning over two and a half years. 5. The award was made by the Department of the Navy, a major DoD component. 6. The North American Industry Classification System (NAICS) code 333611 points to turbine manufacturing.
Value Assessment
Rating: questionable
Benchmarking the value of this $74.6 million contract is challenging without comparable sole-source awards for similar turbine generator sets. The firm fixed-price nature suggests the government aimed to lock in costs, but the lack of competition prevents a robust assessment of whether this price represents good value for money compared to market alternatives. Further analysis would require understanding the specific technical requirements and the availability of alternative suppliers.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not publicly competed. This typically occurs when only one responsible source is available or when a compelling justification exists for excluding other potential bidders. The lack of competition limits the government's ability to leverage market forces to achieve the best possible price and terms.
Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as the benefits of competitive bidding are forgone. Without competition, there is less pressure on the contractor to offer the most competitive pricing.
Public Impact
The primary beneficiaries are the Department of the Navy and potentially other Department of Defense entities requiring turbine generator sets. The contract delivers essential equipment for power generation, likely for naval vessels or shore facilities. The geographic impact is primarily within the United States, where Oshkosh Corp. is based and where the equipment will likely be manufactured and delivered. Workforce implications include employment at 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 have resulted in a higher price than a competed award.
- Sole-source awards can reduce transparency and accountability in the procurement process.
- Dependence on a single supplier can create risks related to supply chain disruptions or future price increases.
Positive Signals
- Firm fixed-price contract provides cost certainty for the government.
- Oshkosh Corp. is a known entity, potentially indicating a level of established capability.
- The award was made by a major federal agency, suggesting a significant operational need.
Sector Analysis
The manufacturing of turbine and turbine generator sets falls under the industrial equipment sector, specifically within the machinery manufacturing subsector. This market is characterized by specialized engineering, high manufacturing costs, and often involves significant government contracts, particularly for defense applications. The size of this specific market segment can vary, but it is critical for national security and infrastructure. Comparable spending benchmarks would involve looking at other large-scale procurements of power generation equipment for military or critical infrastructure projects.
Small Business Impact
There is no indication that this contract involved small business set-asides. As a sole-source award to a large corporation (Oshkosh Corp.), it is unlikely to have direct subcontracting opportunities specifically mandated for small businesses under this particular award. The impact on the small business ecosystem would be indirect, potentially through Oshkosh Corp.'s broader supply chain, but not as a direct result of this specific contract's structure.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified goods at an agreed-upon price. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Turbine Manufacturing
- Generator Set Procurement
- Department of Defense Equipment Contracts
- Naval Power Systems
- Industrial Machinery Manufacturing
Risk Flags
- Sole-source award
- Lack of competition
- Potential for higher cost
Tags
defense, department-of-defense, department-of-the-navy, sole-source, firm-fixed-price, turbine-generator-sets, manufacturing, oshkosh-corp, large-contract, industrial-equipment
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $74.6 million to OSHKOSH CORP. TRACTORS
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 $74.6 million.
What is the period of performance?
Start: 2006-12-11. End: 2009-07-09.
What is Oshkosh Corp.'s track record with the Department of Defense for similar equipment?
Oshkosh Corporation, while known for its defense vehicles, has a diverse portfolio. Information on their specific track record with turbine and turbine generator sets for the Department of Defense prior to this award would require a deeper dive into historical contract data. However, their established presence as a defense contractor suggests familiarity with government procurement processes and quality standards. A review of past performance evaluations and any prior awards for power generation equipment would provide a more comprehensive understanding of their capabilities and reliability in this specific product category.
How does the value of this contract compare to similar turbine generator set procurements?
Direct comparison of this $74.6 million contract value is difficult without identifying identical or highly similar sole-source awards for turbine generator sets. The uniqueness of specialized equipment, coupled with the sole-source nature of this award, limits direct benchmarking. To assess value, one would ideally compare it against competed contracts for similar specifications or against independent cost estimates. The firm fixed-price structure aims to provide cost certainty, but the absence of competition means the price cannot be validated against market alternatives through a bidding process.
What are the primary risks associated with a sole-source award for critical equipment like turbine generator sets?
The primary risks associated with a sole-source award for critical equipment include potential overpayment due to lack of price competition, reduced incentive for the contractor to innovate or improve efficiency, and a lack of transparency in the procurement process. Furthermore, reliance on a single supplier can create vulnerabilities in the supply chain, potentially leading to delays or disruptions if the contractor faces production issues. There's also a risk of vendor lock-in, making it difficult to switch suppliers in the future even if better options become available.
What is the expected impact of these turbine generator sets on naval operational readiness?
Turbine generator sets are critical components for providing electrical power on naval vessels, supporting everything from propulsion systems to life support and combat systems. The successful delivery and integration of these sets are expected to enhance or maintain the operational readiness of the naval platforms they are assigned to. Reliable power generation is fundamental to the functioning of modern warships, ensuring that all onboard systems operate effectively, thereby contributing directly to the Navy's ability to conduct its missions.
What is the historical spending trend for turbine and turbine generator sets by the Department of the Navy?
Analyzing historical spending trends for turbine and turbine generator sets by the Department of the Navy would require accessing and aggregating contract data over several fiscal years. This would involve filtering for relevant NAICS codes (like 333611) and keywords related to turbines and generators. Such an analysis could reveal patterns in procurement volume, average contract values, and the prevalence of sole-source versus competed awards. Understanding these trends can help contextualize the significance of the $74.6 million award and identify potential shifts in acquisition strategies or technological requirements.
Were there any justifications provided for awarding this contract on a sole-source basis?
Sole-source awards are typically justified by specific circumstances outlined in federal acquisition regulations. Common justifications include the unavailability of other sources, the need for compatibility with existing systems, or urgent and compelling requirements where competition is not feasible. For this contract, the justification would likely stem from unique technical specifications, proprietary technology, or a limited number of manufacturers capable of meeting the stringent requirements of the Department of the Navy for turbine generator sets. Accessing the contract's justification for other than full and open competition (JOFOC) documentation would provide the specific rationale.
Industry Classification
NAICS: Manufacturing › Engine, Turbine, and Power Transmission Equipment Manufacturing › Turbine and Turbine Generator Set Units 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
Address: 2307OREGON STREET, OSHKOSH, WI, 06
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $74,590,938
Exercised Options: $74,590,938
Current Obligation: $74,590,938
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: M6785404D5016
IDV Type: IDC
Timeline
Start Date: 2006-12-11
Current End Date: 2009-07-09
Potential End Date: 2009-07-09 00:00:00
Last Modified: 2011-08-15
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