Army awards $3.1M contract for specialized freight services, highlighting long-distance trucking needs

Contract Overview

Contract Amount: $31,153,320 ($31.2M)

Contractor: El-Hoss Engineering & Transport Company W.L.L.

Awarding Agency: Department of Defense

Start Date: 2009-12-18

End Date: 2010-06-30

Contract Duration: 194 days

Daily Burn Rate: $160.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: REACH-BACK HVY LIFT VI OPTYR4

Plain-Language Summary

Department of Defense obligated $31.2 million to EL-HOSS ENGINEERING & TRANSPORT COMPANY W.L.L. for work described as: REACH-BACK HVY LIFT VI OPTYR4 Key points: 1. Contract value of $3.1 million for specialized freight services indicates significant logistical requirements. 2. The award was made under full and open competition, suggesting a competitive market for these services. 3. A duration of 194 days points to a focused, short-term operational need. 4. The fixed-price contract type aims to control costs and provide predictability. 5. This contract addresses a specific niche within freight transportation, focusing on heavy lift and long-distance capabilities.

Value Assessment

Rating: fair

The contract value of $3.1 million for specialized freight services appears reasonable given the nature of heavy lift and long-distance trucking. Benchmarking against similar contracts for specialized logistics would provide a clearer picture of value for money. The fixed-price nature of the award suggests an effort to manage costs, but without detailed cost breakdowns or comparisons to market rates for similar services, a definitive assessment of pricing efficiency is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors were eligible to bid. The presence of 3 bidders suggests a moderate level of competition for this specialized service. While competition is generally positive for price discovery, the specific number of bidders (3) might not represent the full market potential, and further analysis would be needed to determine if the competition was robust enough to drive optimal pricing.

Taxpayer Impact: The full and open competition process is beneficial for taxpayers as it encourages multiple companies to offer their services, potentially leading to lower prices and better quality through competitive bidding.

Public Impact

The primary beneficiaries are likely military units requiring specialized transportation for equipment or supplies. Services delivered include long-distance, heavy-lift trucking, crucial for logistical support in various operational environments. The geographic impact is likely broad, covering long-distance routes as specified by the Army's operational needs. Workforce implications include employment for truck drivers, logistics personnel, and support staff within the winning contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen logistical challenges arise, despite the fixed-price structure.
Dependence on a single contractor for critical, specialized transport could pose a risk if performance issues emerge.
Limited competition (3 bidders) might indicate barriers to entry or a niche market, potentially impacting long-term cost-effectiveness.

Positive Signals

Awarded under full and open competition, suggesting a fair and accessible bidding process.
Fixed-price contract type helps to establish cost certainty for the government.
The contract addresses a specific, critical need for specialized freight, ensuring operational readiness.

Sector Analysis

The transportation and logistics sector is a critical component of the federal supply chain, encompassing a wide range of services from general freight to highly specialized transport. This contract falls within the specialized freight sub-sector, which often involves unique equipment, expertise, and regulatory compliance for handling oversized, overweight, or sensitive cargo. The market for such services can be niche, with a limited number of providers possessing the necessary capabilities. Federal spending in this area supports military readiness, disaster response, and the movement of essential goods.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The prime contractor, EL-HOSS ENGINEERING & TRANSPORT COMPANY W.L.L., is likely a larger entity. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, unless the prime contractor voluntarily engages small businesses for support services.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Army's contracting and program management offices. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to successful delivery. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Military Logistics Support
Specialized Freight Services
Long-Haul Trucking Contracts
Department of Defense Transportation Contracts

Risk Flags

Potential for performance delays due to logistical complexity.
Risk of cost escalation for contractor if unforeseen issues arise.
Dependence on specialized equipment and expertise.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.2 million to EL-HOSS ENGINEERING & TRANSPORT COMPANY W.L.L.. REACH-BACK HVY LIFT VI OPTYR4

Who is the contractor on this award?

The obligated recipient is EL-HOSS ENGINEERING & TRANSPORT COMPANY W.L.L..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $31.2 million.

What is the period of performance?

Start: 2009-12-18. End: 2010-06-30.

What is the track record of EL-HOSS ENGINEERING & TRANSPORT COMPANY W.L.L. with federal contracts, particularly within the Department of Defense?

A comprehensive review of EL-HOSS ENGINEERING & TRANSPORT COMPANY W.L.L.'s federal contract history would involve analyzing data from sources like the Federal Procurement Data System (FPDS). This would reveal the number of contracts awarded, their values, the agencies involved, and the types of services rendered. Specific attention should be paid to past performance ratings, any contract disputes or terminations, and the company's experience with similar specialized freight and heavy-lift operations. Understanding their history with the Department of the Army and other defense agencies is crucial for assessing their reliability and capability in fulfilling this current award.

How does the awarded amount of $3.1 million compare to market rates for similar specialized freight and long-distance trucking services?

Benchmarking the $3.1 million award against market rates requires detailed analysis of the specific services, including the type of heavy equipment transported, the distances covered, and the urgency of delivery. Industry reports on specialized logistics pricing, freight broker data, and comparisons with other government contracts for similar services (adjusted for scope and duration) are essential. Without this granular data, it's difficult to definitively state if the price represents excellent value. However, the fixed-price nature suggests an attempt to secure a predictable cost, and the full and open competition implies market forces were at play, which generally aids in achieving competitive pricing.

What are the primary risks associated with this contract, considering its specialized nature and fixed-price structure?

The primary risks associated with this contract include potential performance failures due to the specialized nature of heavy-lift and long-distance trucking, which can involve complex logistical challenges and potential equipment breakdowns. Despite the fixed-price structure, unforeseen circumstances like extreme weather, route disruptions, or unexpected regulatory hurdles could lead to delays or increased costs for the contractor, potentially impacting delivery schedules. Another risk is the contractor's capacity to manage such a specialized operation effectively over the contract duration. The limited number of bidders (3) could also indicate a risk if the chosen contractor faces significant operational issues, as finding alternative solutions might be challenging.

How effective is the fixed-price contract type in ensuring cost control for specialized freight services like this?

The fixed-price contract type is generally effective in ensuring cost control for the government, as it shifts the risk of cost overruns to the contractor. The contractor is obligated to perform the specified services for the agreed-upon price, regardless of their actual costs. This incentivizes the contractor to manage their expenses efficiently and to accurately estimate all costs upfront. However, for highly specialized or complex services where unforeseen issues are more likely, a fixed-price contract could lead the contractor to build in significant contingency into their bid, potentially resulting in a higher initial price compared to a cost-reimbursement contract. The effectiveness also depends on the clarity and completeness of the contract's scope of work.

What is the historical spending pattern for specialized freight and long-distance trucking by the Department of the Army?

Analyzing historical spending patterns for specialized freight and long-distance trucking by the Department of the Army would involve examining procurement data over several fiscal years. This would reveal trends in contract values, the number of awards, the types of services procured, and the primary contractors utilized. Such an analysis could indicate whether spending in this category is increasing, decreasing, or remaining stable, and whether this $3.1 million award is consistent with historical levels or represents a significant deviation. Understanding these patterns helps in assessing the ongoing need for such services and the government's investment strategy in this area.

Industry Classification

NAICS: Transportation and Warehousing › Specialized Freight Trucking › Specialized Freight (except Used Goods) Trucking, Long-Distance

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: INDUSTRIAL AREA OF EAST AHMADI, AHMADI

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership

Financial Breakdown

Contract Ceiling: $31,153,320

Exercised Options: $31,153,320

Current Obligation: $31,153,320

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912D105D0012

IDV Type: IDC

Timeline