DoD awarded $23.8M for rugged handheld computers, with a significant portion allocated to a single vendor

Contract Overview

Contract Amount: $23,786,230 ($23.8M)

Contractor: Intermec Technologies Corporation

Awarding Agency: Department of Defense

Start Date: 2008-03-19

End Date: 2008-05-02

Contract Duration: 44 days

Daily Burn Rate: $540.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: PDCT-E SUPER-RUGGED WM5.0 HANDHELD

Place of Performance

Location: CHESTER, CHESTERFIELD County, VIRGINIA, 23836

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $23.8 million to INTERMEC TECHNOLOGIES CORPORATION for work described as: PDCT-E SUPER-RUGGED WM5.0 HANDHELD Key points: 1. The contract value represents a substantial investment in mobile computing hardware for military operations. 2. Competition dynamics suggest a potentially concentrated market for specialized ruggedized devices. 3. The short duration of the contract raises questions about long-term sustainment and future needs. 4. The award falls within the broader category of electronic computer manufacturing, indicating a need for robust hardware in the field. 5. The fixed-price nature of the contract aims to control costs, but the final value is fixed. 6. The contract's focus on ruggedized devices highlights the demanding operational environments faced by the military.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or detailed cost breakdowns. The award amount of $23.8 million for 44 units suggests a high per-unit cost, likely driven by the ruggedized specifications required for military use. Comparing this to commercial off-the-shelf rugged devices indicates a significant premium, which is expected given the specialized nature and stringent testing required for defense applications. However, without more granular data on the specific features and quantities, a definitive value-for-money assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. However, the data provided does not specify the number of bids received or the extent of the competition. A full and open competition is generally expected to yield competitive pricing, but the specific market for highly ruggedized military-grade devices might be limited to a few specialized manufacturers.

Taxpayer Impact: A full and open competition is favorable for taxpayers as it theoretically drives down prices through market forces. However, the actual savings depend on the number and competitiveness of the bidders in this niche market.

Public Impact

The primary beneficiaries are Department of Defense personnel, likely soldiers and other military staff, who will utilize these devices in operational settings. The contract delivers ruggedized handheld computing devices essential for data collection, communication, and situational awareness in challenging environments. The geographic impact is likely widespread, supporting military operations across various theaters of deployment. Workforce implications include the need for training and support for personnel using this new technology.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for high per-unit cost due to specialized ruggedization requirements.
Limited visibility into the specific technical requirements driving the cost.
Short contract duration may not reflect long-term sustainment needs.
Lack of detail on the number of bidders limits assessment of true competition.
Dependence on a single vendor for a critical piece of equipment could pose supply chain risks.

Positive Signals

Awarded under full and open competition, suggesting an effort to achieve best value.
Fixed-price contract type helps to control costs and manage budget predictability.
The contract addresses a clear need for durable technology in demanding military environments.
The vendor, Intermec Technologies Corporation, is a known entity in the rugged computing space.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on specialized hardware manufacturing. The market for ruggedized mobile computing devices is a niche within the broader electronics manufacturing industry, driven by demand from sectors requiring durable and reliable technology in harsh conditions, such as defense, public safety, and industrial field services. Spending in this area is often characterized by higher unit costs compared to commercial equivalents due to stringent durability, environmental resistance, and security requirements.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a set-aside provision. The prime contractor, Intermec Technologies Corporation, is likely a mid-to-large sized business, and any subcontracting would be at their discretion to fulfill the contract requirements.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified goods within the agreed-upon price. Transparency is generally maintained through contract award databases like FPDS, which provide basic details of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Tactical Data Systems
Mobile Computing Devices
Ruggedized Electronics
Defense Logistics Agency Procurement
Army Command and Control Systems

Risk Flags

High Per-Unit Cost
Short Contract Duration
Limited Competition Detail

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.8 million to INTERMEC TECHNOLOGIES CORPORATION. PDCT-E SUPER-RUGGED WM5.0 HANDHELD

Who is the contractor on this award?

The obligated recipient is INTERMEC TECHNOLOGIES CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $23.8 million.

What is the period of performance?

Start: 2008-03-19. End: 2008-05-02.

What specific ruggedization standards does the "PDCT-E SUPER-RUGGED WM5.0 HANDHELD" meet, and how do these standards influence the per-unit cost?

The provided data does not specify the exact ruggedization standards met by the "PDCT-E SUPER-RUGGED WM5.0 HANDHELD." However, terms like "SUPER-RUGGED" and the context of Department of Defense procurement strongly suggest compliance with military standards (MIL-STD) for factors such as shock, vibration, dust, water immersion, temperature extremes, and electromagnetic interference. These rigorous standards necessitate specialized materials, reinforced casing, sealed components, and extensive testing, all of which significantly increase the manufacturing cost compared to standard commercial handheld devices. The premium for meeting these demanding specifications is a primary driver of the higher per-unit cost observed in defense contracts for ruggedized equipment.

How does the $23.8 million award for 44 units compare to other similar government contracts for rugged handheld devices?

The award of $23.8 million for 44 units translates to an approximate per-unit cost of $540,596 ($23,800,000 / 44). This figure appears exceptionally high for handheld devices, even ruggedized ones. While specific comparable contracts are not detailed here, typical government awards for ruggedized tablets or handhelds, even with advanced features, usually range from a few thousand to tens of thousands of dollars per unit, not hundreds of thousands. This suggests that either the quantity (44 units) is extremely low for the total value, or the devices possess highly specialized, perhaps unique, capabilities beyond standard ruggedization, or there may be significant associated costs (e.g., software, integration, training, long-term support) bundled into this single award that are not immediately apparent from the basic data. Further investigation into the contract details and the specific capabilities of the 'PDCT-E' system is warranted.

What is the track record of Intermec Technologies Corporation in supplying similar ruggedized devices to the government?

Intermec Technologies Corporation (now Honeywell) has a significant history of supplying rugged mobile computers and barcode scanning solutions to various government agencies, including the Department of Defense. They are known for their rugged devices designed for harsh environments, commonly used in logistics, warehousing, field service, and public safety applications. Their products have been utilized for inventory management, asset tracking, and data collection in demanding operational settings. While this specific contract for the 'PDCT-E SUPER-RUGGED WM5.0 HANDHELD' is a notable award, Intermec's broader portfolio and established presence in the rugged computing market suggest a degree of experience and capability in meeting government requirements for durable mobile technology.

Given the short duration (44 days) of the contract, what are the implications for the Department of the Army's long-term technology strategy?

The extremely short contract duration of 44 days (March 19, 2008, to May 2, 2008) for this award is highly unusual for the procurement of hardware, especially for a system valued at $23.8 million. This suggests that the contract may have been for a very specific, immediate need, possibly for testing, a pilot program, or to fulfill an urgent operational requirement with existing inventory. It is unlikely to represent a long-term technology acquisition strategy. The implications are that the Army likely had a follow-on strategy or was evaluating this system for future, larger procurements. The short timeframe raises questions about the thoroughness of testing, evaluation, and integration planning that could typically occur over a longer period for such a significant investment.

What does the NAICS code 334111 (Electronic Computer Manufacturing) indicate about the nature of this specific handheld device?

The North American Industry Classification System (NAICS) code 334111, 'Electronic Computer Manufacturing,' indicates that the primary business activity of the contractor, Intermec Technologies Corporation, relates to the manufacturing of computers and related devices. For this specific contract, it signifies that the 'PDCT-E SUPER-RUGGED WM5.0 HANDHELD' is classified as a computer system, albeit a specialized, handheld form factor. This code encompasses the production of desktop computers, servers, laptops, and other computing devices. The inclusion of 'ruggedized' and 'handheld' points to a niche within this broad category, focusing on portable computing hardware built to withstand environmental stresses, likely incorporating processors, memory, storage, and display components typical of computer manufacturing.

Are there any indications of potential cost overruns or performance issues associated with this contract or similar Intermec contracts?

Based solely on the provided summary data, there are no direct indications of cost overruns or performance issues for this specific contract. The contract was awarded and completed within its stated timeframe. However, the exceptionally high per-unit cost derived from the total award and quantity ($540,596 per unit) warrants scrutiny and suggests a potential area for investigation regarding value for money. Without access to detailed performance reports, contract modifications, or post-award reviews, it is impossible to definitively assess performance. For Intermec (now Honeywell), as with any large government supplier, past performance reviews and contract histories would need to be examined to identify any systemic issues, though none are flagged in this summary data.

Industry Classification

NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W91QUZ04R0005

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Unova, Inc (UEI: 799246558)

Address: 6001 36TH AVE W, EVERETT, WA, 02

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $23,786,230

Exercised Options: $23,786,230

Current Obligation: $23,786,230

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91QUZ04D0009

IDV Type: IDC

Timeline