DOT awards $6.75M for 25 boxcars to Ebenezer Railcar Services, Inc

Contract Overview

Contract Amount: $6,753,115 ($6.8M)

Contractor: Ebenezer Railcar Services, Inc.

Awarding Agency: Department of Transportation

Start Date: 2025-08-25

End Date: 2026-08-31

Contract Duration: 371 days

Daily Burn Rate: $18.2K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: MANUFACTURE AND DELIVERY OF 25 BOXCARS FOR EARLE NAVAL WEAPONS STATION.

Place of Performance

Location: BUFFALO, ERIE County, NEW YORK, 14224

State: New York Government Spending

Plain-Language Summary

Department of Transportation obligated $6.8 million to EBENEZER RAILCAR SERVICES, INC. for work described as: MANUFACTURE AND DELIVERY OF 25 BOXCARS FOR EARLE NAVAL WEAPONS STATION. Key points: 1. The contract value of $6.75 million for 25 boxcars suggests a per-unit cost of approximately $270,124. 2. This purchase order was competed under Simplified Acquisition Procedures (SAP), indicating a focus on smaller value procurements. 3. The firm fixed-price contract type mitigates cost overrun risks for the government. 4. Delivery is scheduled for August 2026, aligning with the need for rolling stock at Earle Naval Weapons Station. 5. The contract falls under the Railroad Rolling Stock Manufacturing NAICS code. 6. The geographic impact is localized to New York, where the contractor is based.

Value Assessment

Rating: fair

The awarded amount of $6.75 million for 25 boxcars equates to roughly $270,124 per unit. Benchmarking this against industry standards for specialized railcars is challenging without more specific technical requirements. However, the price appears within a reasonable range for custom-manufactured rolling stock, especially considering potential material costs and manufacturing complexity. The firm fixed-price nature provides cost certainty.

Cost Per Unit: Approximately $270,124 per boxcar.

Competition Analysis

Competition Level: full-and-open

The contract was competed under Simplified Acquisition Procedures (SAP), which is typically used for purchases below the simplified acquisition threshold. While the exact number of bidders is not specified, SAP generally allows for a broader range of competition than sole-source or limited solicitations. This method aims to balance efficiency with obtaining competitive pricing for smaller procurements.

Taxpayer Impact: Using SAP for this procurement suggests an effort to efficiently acquire necessary equipment while still leveraging competition to secure a fair price for taxpayers.

Public Impact

The primary beneficiary is the Department of Transportation, specifically the Earle Naval Weapons Station, which will receive 25 new boxcars. These boxcars are essential for the transportation and storage of materials at the naval facility. The contract supports manufacturing jobs within the railcar industry, likely in New York. The successful delivery of these boxcars will ensure the continued operational readiness of the Earle Naval Weapons Station.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for extended lead times if manufacturing capacity is constrained.
Dependence on the financial stability and operational capacity of Ebenezer Railcar Services, Inc.
Risk of unforeseen supply chain disruptions impacting material availability or cost.

Positive Signals

Firm fixed-price contract limits cost escalation risk for the government.
Competition under SAP suggests an effort to obtain market-based pricing.
Clear delivery schedule provides a defined timeline for project completion.

Sector Analysis

The contract falls within the Railroad Rolling Stock Manufacturing sector, a specialized segment of the transportation equipment industry. This sector is characterized by high manufacturing costs, stringent safety regulations, and often long production cycles. The market size for new railcars can fluctuate based on economic conditions, freight demand, and government infrastructure spending. This specific procurement supports a niche but critical need for specialized rolling stock.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the nature of railcar manufacturing, it often involves specialized facilities and expertise that may be concentrated among larger firms. Further analysis would be needed to determine if small businesses were involved in the supply chain or as potential subcontractors.

Oversight & Accountability

The contract is a purchase order, which is a common form of agreement for goods. Oversight would typically involve monitoring delivery schedules, quality control of the manufactured boxcars, and ensuring compliance with the contract terms. The Department of Transportation's contracting office would be responsible for oversight, with potential involvement from quality assurance representatives. Transparency is generally maintained through contract award databases.

Related Government Programs

Department of Defense Rolling Stock Procurements
Federal Railroad Administration Equipment Grants
Transportation Infrastructure Investment Programs

Risk Flags

Award amount exceeds standard Simplified Acquisition Procedures (SAP) threshold.
Lack of detailed technical specifications makes value assessment difficult.
Potential for supply chain disruptions impacting delivery timeline.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $6.8 million to EBENEZER RAILCAR SERVICES, INC.. MANUFACTURE AND DELIVERY OF 25 BOXCARS FOR EARLE NAVAL WEAPONS STATION.

Who is the contractor on this award?

The obligated recipient is EBENEZER RAILCAR SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Transportation (Immediate Office of the Secretary of Transportation).

What is the total obligated amount?

The obligated amount is $6.8 million.

What is the period of performance?

Start: 2025-08-25. End: 2026-08-31.

What is the typical lead time for manufacturing 25 specialized boxcars of this nature?

The typical lead time for manufacturing 25 specialized boxcars can vary significantly based on the specific design, materials required, and the manufacturer's current production backlog. Generally, custom-built railcars can take anywhere from 6 to 18 months from order placement to delivery. Factors such as the availability of specialized components (like wheels, couplers, and braking systems), labor availability, and the complexity of the manufacturing process all contribute to the overall timeline. For this contract, the duration from award (assumed shortly after data extraction) to the September 2026 delivery suggests a lead time of approximately 12-15 months, which appears to be within the standard range for such specialized equipment.

How does the per-unit cost of $270,124 compare to similar recent federal procurements for boxcars?

Directly comparing the per-unit cost of $270,124 for these 25 boxcars to similar federal procurements requires access to detailed specifications of those other contracts. Boxcar costs are highly dependent on their intended use, capacity, materials, and specialized features (e.g., refrigeration, specific load-bearing capabilities). A standard freight boxcar might cost less, while a highly specialized unit for military or hazardous materials could cost significantly more. Without knowing the exact specifications of the boxcars procured for Earle Naval Weapons Station and comparing them to other federal awards for similarly specified rolling stock, a precise benchmark is difficult. However, this figure represents a substantial investment per unit, suggesting these are likely not basic freight cars.

What are the primary risks associated with this contract for Ebenezer Railcar Services, Inc.?

The primary risks for Ebenezer Railcar Services, Inc. revolve around production and delivery. These include potential delays in sourcing raw materials (steel, specialized components), labor shortages impacting manufacturing capacity, and unforeseen production issues that could affect quality or timelines. The firm fixed-price nature of the contract means that any cost overruns due to these issues would be absorbed by the contractor, potentially impacting profitability. Furthermore, meeting the specific quality and performance standards required by the Department of Transportation for naval weapons station use presents a technical risk. Ensuring timely delivery by the August 2026 deadline is critical to avoid penalties or contract disputes.

What is the historical spending pattern for railroad rolling stock by the Department of Transportation?

Historical spending patterns for railroad rolling stock by the Department of Transportation (DOT) can be varied, reflecting different agency needs and funding initiatives. The Federal Railroad Administration (FRA) often awards grants and contracts for passenger rail equipment, track infrastructure, and safety technology. Procurements for freight rolling stock, particularly for specialized military logistics like this contract for Earle Naval Weapons Station (which falls under the Navy's purview but is facilitated through DOT's broader transportation mandate), are less frequent but critical. Analyzing historical data would likely show peaks and troughs corresponding to major infrastructure bills, military readiness requirements, and the lifecycle replacement needs of existing fleets. This $6.75 million award appears to be a specific, targeted procurement rather than part of a large-scale fleet acquisition program.

What are the implications of using Simplified Acquisition Procedures (SAP) for this procurement?

The use of Simplified Acquisition Procedures (SAP) for this $6.75 million procurement implies that the Department of Transportation deemed the requirement to be below the threshold for full and open competition under the Federal Acquisition Regulation (FAR). SAP is designed to streamline the acquisition process for purchases generally valued between $3,000 and $250,000 (though thresholds can be higher for certain agencies or under specific circumstances). However, the stated award amount of $6,753,115 significantly exceeds the standard SAP threshold. This suggests either a misunderstanding of the data provided, or that this procurement utilized specific FAR provisions allowing for SAP-like procedures for larger amounts under certain conditions, or that the 'COMPETED UNDER SAP' designation is an imprecise descriptor. Typically, an award of this magnitude would undergo a more robust competitive process. If it truly was competed under SAP, it implies a less formal solicitation process, potentially fewer bidders, and a focus on speed and efficiency over maximizing competition.

Industry Classification

NAICS: Manufacturing › Railroad Rolling Stock Manufacturing › Railroad Rolling Stock Manufacturing

Product/Service Code: RAILWAY EQUIPMENT

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: ERS Industries, Inc.

Address: 1005 INDIAN CHURCH RD, WEST SENECA, NY, 14224

Business Categories: Category Business, Manufacturer of Goods, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $6,753,115

Exercised Options: $6,753,115

Current Obligation: $6,753,115

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline