Department of Defense awarded $207.8M contract for wheeled trucks and tractors to Canadian Commercial Corporation

Contract Overview

Contract Amount: $469,060,566 ($469.1M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 1999-12-28

End Date: 2009-05-05

Contract Duration: 3,416 days

Daily Burn Rate: $137.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200012!2100!000579!AE07 !TACOM - WARREN !DAAE0700CX075 !A!*!* !19991228!20031231!207884594!207884594!241015486!N!98247!CANADIAN COMMERCIAL CORPORATIO!50 O CONNOR ST STE 1100 !OTTAWA !CA!K1A 0!* !* !CA!* !* !CANADA !0001!+000428181983!Y!N!000000000000!2320!TRUCKS AND TRUCK TRACTORS, WHEELED !A4A!COMBAT VEHICLES !1DJM!LIGHT ARMORED VEHICLE (LAV) !3695!3!*!*!*!B!N!Z!D !U!U!1!001!N!1A!Z!Y!Z!B !CA!N!L!*!*!*!A!A!A!A!* !*!N!A!B!N!*!*!*!*!*!

Plain-Language Summary

Department of Defense obligated $469.1 million to CANADIAN COMMERCIAL CORPORATION for work described as: 200012!2100!000579!AE07 !TACOM - WARREN !DAAE0700CX075 !A!*!* !19991228!20031231!207884594!207884594!241015486!N!98247!CANADIAN COMMERCIAL CORPORATIO!50 O CONNOR ST STE 1100 !OTTAWA !CA!K1A 0!* !* !CA!* !* … Key points: 1. Contract awarded for wheeled trucks and tractors, indicating a need for specialized vehicle support. 2. The contract's duration of over 9 years suggests a long-term requirement for these assets. 3. Awarded to a single foreign entity, raising questions about competition and domestic industrial base utilization. 4. The cost-plus-fixed-fee pricing structure may incentivize cost overruns. 5. The contract falls under the Combat Vehicles category, highlighting its strategic importance. 6. Significant value suggests a substantial fleet or operational requirement for these vehicles.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its unique nature as a foreign military sale facilitated through a Canadian entity. The total value of over $207 million over a decade suggests a significant procurement. However, without comparable domestic contracts or detailed cost breakdowns, assessing value-for-money is difficult. The cost-plus-fixed-fee (CPFF) contract type, while allowing for flexibility, can lead to higher costs compared to fixed-price contracts if not managed diligently.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. The data indicates it was 'NOT COMPETED'. This approach is often used for specific foreign military sales or when a unique capability is required from a particular supplier. The lack of competition means that the government did not explore alternative sources or pricing, potentially leading to a higher cost than if multiple bids were solicited.

Taxpayer Impact: The absence of competition means taxpayers did not benefit from potential cost savings that could arise from a competitive bidding process. The government paid the price set by the sole supplier without the leverage of multiple offers.

Public Impact

The primary beneficiaries are likely elements within the Department of Defense requiring specialized wheeled vehicles for operational or logistical support. The services delivered include the provision of trucks and truck tractors, essential for military mobility and logistics. The geographic impact is primarily within the operational theaters where these vehicles are deployed by the U.S. military. Workforce implications could include support roles for maintenance, logistics, and potentially training related to the operation of these vehicles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits opportunities for U.S. small businesses to participate in the supply chain.
Cost-plus-fixed-fee contract type may lead to less cost control compared to fixed-price arrangements.
Long contract duration (over 9 years) could indicate a lack of readily available alternatives or a strategic long-term need.
Award to a foreign entity raises questions about domestic industrial base support and potential geopolitical considerations.

Positive Signals

The contract addresses a specific need for wheeled vehicles, indicating a focus on essential military equipment.
The Canadian Commercial Corporation's involvement suggests a structured procurement process, albeit non-competitive.
The large contract value implies a significant operational requirement being met.

Sector Analysis

This contract falls within the broader defense sector, specifically concerning the procurement of tactical wheeled vehicles. The market for such vehicles is dominated by a few large defense contractors, but also includes specialized suppliers. The value of this contract, exceeding $207 million, is substantial and indicates a significant acquisition. Comparable spending benchmarks would typically involve other large-scale vehicle procurements by military branches, often in the hundreds of millions or billions of dollars for major fleet renewals or new platforms.

Small Business Impact

As this contract was awarded on a sole-source basis to a foreign entity, there is no indication of small business set-asides or subcontracting opportunities for U.S. small businesses directly through this award. The Canadian Commercial Corporation would be responsible for managing the prime contract, and any subcontracting would likely be determined by their internal processes and the nature of the goods/services procured, potentially not prioritizing U.S. small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and program management offices. Given it's a sole-source award to a foreign entity, specific oversight mechanisms might include clauses related to delivery, quality assurance, and payment terms. Transparency is limited due to the non-competitive nature. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Tactical Wheeled Vehicles
Military Logistics Support
Foreign Military Sales
Department of Defense Vehicle Procurement
Combat Support Equipment

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Foreign entity awardee

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $469.1 million to CANADIAN COMMERCIAL CORPORATION. 200012!2100!000579!AE07 !TACOM - WARREN !DAAE0700CX075 !A!*!* !19991228!20031231!207884594!207884594!241015486!N!98247!CANADIAN COMMERCIAL CORPORATIO!50 O CONNOR ST STE 1100 !OTTAWA !CA!K1A 0!* !* !CA!* !* !CANADA !0001!+000428181983!Y!N!000000000000!2320!TRUCKS AND TRUCK TRACTORS, WHEELED !A4A!COMBAT VEHICLES !1DJM!LIGHT ARMORED VEHICLE (LAV) !3695!3!*!*!*!B!N!Z!D !U!U!

Who is the contractor on this award?

The obligated recipient is CANADIAN COMMERCIAL 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 $469.1 million.

What is the period of performance?

Start: 1999-12-28. End: 2009-05-05.

What is the specific type and capability of the 'TRUCKS AND TRUCK TRACTORS, WHEELED' procured under this contract?

The contract specifies 'TRUCKS AND TRUCK TRACTORS, WHEELED' under the Product Service Code (PSC) 2320. While the data does not detail the exact specifications, this category typically includes a wide range of vehicles from light tactical trucks to heavy equipment transporters and prime movers. Given the associated sub-category 'COMBAT VEHICLES' and specific line item 'LIGHT ARMORED VEHICLE (LAV)', it is highly probable that these are specialized, potentially armored, wheeled vehicles designed for military operations, possibly including troop transport, cargo hauling, or as platforms for weapon systems in combat zones. The duration and value suggest a significant number of units or a highly specialized, long-lifecycle requirement.

Why was this contract awarded on a sole-source basis to the Canadian Commercial Corporation?

The contract was 'NOT COMPETED', indicating a sole-source award. Common reasons for sole-sourcing include unique capabilities possessed by only one source, urgent and compelling needs where competition is not feasible, or specific requirements tied to international agreements or foreign military sales (FMS). In this case, the award to the Canadian Commercial Corporation (CCC) suggests it may have been facilitated through a government-to-government agreement or that CCC was the designated entity to procure these specific vehicles, possibly manufactured by a Canadian entity or sourced through them. Without further documentation, the precise justification remains unspecified in the provided data.

How does the Cost Plus Fixed Fee (CPFF) contract type impact the overall cost and risk for the government?

A Cost Plus Fixed Fee (CPFF) contract means the government pays the contractor's actual costs plus a predetermined fixed fee representing profit. This structure offers flexibility, especially when the scope of work is not precisely defined or is expected to evolve, as is common in complex defense procurements. However, it shifts much of the cost risk to the government, as the final price is not capped. The contractor has less incentive to control costs since their fee is fixed regardless of the final cost. This can potentially lead to higher overall expenditures compared to fixed-price contracts, necessitating robust government oversight to manage costs effectively.

What is the historical spending pattern for similar wheeled vehicle procurements by the Department of Defense?

Historical spending on tactical wheeled vehicles by the Department of Defense is substantial, often running into billions of dollars annually across various programs and branches. Major programs like the Joint Light Tactical Vehicle (JLTV) or upgrades to existing truck fleets represent significant investments. Contracts for specialized vehicles, especially those with armored capabilities or unique logistical functions, can range from tens to hundreds of millions of dollars. This specific $207.8 million contract for trucks and tractors, while large, fits within the broader pattern of significant DoD investment in maintaining and modernizing its vehicle fleet to meet global operational demands.

What are the potential implications of awarding a major vehicle contract to a Canadian entity for the U.S. industrial base?

Awarding a significant contract like this to a Canadian entity, facilitated by the Canadian Commercial Corporation, has several implications for the U.S. industrial base. Primarily, it means that U.S. manufacturers and suppliers may not have directly benefited from this particular procurement in terms of revenue, job creation, or technological development. While such agreements can foster international cooperation and interoperability, they also represent a missed opportunity for domestic defense firms. The U.S. government often aims to balance international partnerships with supporting its own defense industrial ecosystem, making sole-source awards to foreign entities a point of consideration regarding industrial base health.

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Government of Canada (UEI: 241015486)

Address: 50 O'CONNOR ST SUITE 1100, OTTAWA

Business Categories: Category Business, Foreign Government, Not Designated a Small Business, Special Designations

Contract Characteristics

Cost or Pricing Data: YES

Timeline