Defense contract for trailers awarded to Systems & Electronics Inc. for over $34 million

Contract Overview

Contract Amount: $34,320,388 ($34.3M)

Contractor: DRS Sustainment Systems, Inc

Awarding Agency: Department of Defense

Start Date: 1997-03-24

End Date: 2007-07-01

Contract Duration: 3,751 days

Daily Burn Rate: $9.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 199712!2100!1145!AE07 !USA TANK-AUTOMOTIVE & ARMAMENTS !DAAE0796CX100 !A!*!P00015 !19970324!19981230!006265466!803404102!618957153!N!98255!SYSTEMS & ELECTRONICS INC !201 EVANS LN !SAINT LOUIS !MO!63121!65000!510!29!ST. LOUIS !ST. LOUIS (CITY) !MISSOURI !0001!+000035623500!N!N!000000000000!2330!TRAILERS !A4B!NON-COMBAT VEHICLES !1000!NOT DISCERNABLE OR CLASSIFIED !8711!1!*!*!C!B!A!*!D !U!J!1!001!N!1A!A!Y!A!* !* !N!C!*!A!A!A!A!A!*!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: SAINT LOUIS, ST. LOUIS County, MISSOURI, 63121

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $34.3 million to DRS SUSTAINMENT SYSTEMS, INC for work described as: 199712!2100!1145!AE07 !USA TANK-AUTOMOTIVE & ARMAMENTS !DAAE0796CX100 !A!*!P00015 !19970324!19981230!006265466!803404102!618957153!N!98255!SYSTEMS & ELECTRONICS INC !201 EVANS LN !SAINT LOUIS !MO!63121!65000!510!29!ST. LOUIS !ST. LO… Key points: 1. Contract awarded for trailers, a critical component for non-combat vehicles. 2. The contract was not competed, raising questions about potential cost savings. 3. The duration of the contract spans over 10 years, indicating a long-term need. 4. The awarded amount of over $34 million suggests a significant investment in this area. 5. The contractor, Systems & Electronics Inc., is based in St. Louis, Missouri. 6. The contract falls under the 'Trailers' product service code, indicating a specific equipment focus.

Value Assessment

Rating: questionable

The awarded amount of $34,320,388.28 for trailers appears substantial. Without comparable contract data or detailed cost breakdowns, it is difficult to definitively assess value for money. The lack of competition (see CA section) further complicates a direct value assessment, as it limits the ability to benchmark against market rates or other potential suppliers. The long contract duration of over 10 years (3751 days) could indicate a stable, long-term requirement, but also necessitates careful monitoring for cost escalation over time.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor can provide the required goods or services, or in specific emergency situations. The lack of competition means that the government did not benefit from the price discovery and potential cost reductions that typically arise from a competitive bidding process.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to drive down prices. Without a competitive process, there is a reduced incentive for the contractor to offer the most cost-effective solution.

Public Impact

The primary beneficiaries are likely military units requiring non-combat vehicles equipped with trailers for logistical support. The services delivered involve the provision of trailers, essential for transporting equipment and supplies. The geographic impact is likely nationwide within the US military, wherever these trailers are deployed. Workforce implications could include manufacturing and maintenance jobs related to trailer production and support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Long contract duration could mask inefficiencies or cost overruns if not closely managed.
Sole-source awards can limit innovation by excluding potential new entrants with novel solutions.

Positive Signals

The contract addresses a specific, likely essential, need for military logistics (trailers for non-combat vehicles).
A single, long-term contract can provide stability and predictability for both the government and the contractor.
The contractor, Systems & Electronics Inc., has secured a significant award, indicating a level of trust or capability.

Sector Analysis

The defense sector encompasses a vast array of equipment procurement, including logistical support assets like trailers. This contract for trailers fits within the broader category of military vehicle components and non-combat support systems. The market for specialized military trailers can be niche, potentially justifying sole-source awards in some circumstances if unique specifications are required. However, the overall defense spending on vehicle-related equipment is in the billions annually, making this contract a relatively small component of the total.

Small Business Impact

There is no indication from the provided data that this contract involved small business set-asides or significant subcontracting opportunities for small businesses. The award was made to a single entity, Systems & Electronics Inc., and the data does not specify any requirements for engaging smaller firms. This suggests that the primary focus was on fulfilling the requirement directly with the awarded contractor, potentially bypassing opportunities to foster small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contract management agencies, such as the Defense Contract Management Agency (DCMA), which is listed as the servicing agency. Accountability measures would include performance reviews, delivery schedules, and quality control. Transparency is limited by the sole-source nature of the award and the lack of publicly available detailed cost breakdowns. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Vehicle Procurement
Logistical Support Equipment
Non-Combat Vehicle Components
Defense Supply Chain Management

Risk Flags

Sole-source award lacks competitive pricing.
Long contract duration may obscure cost control issues.
Limited public data on specific trailer requirements and performance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.3 million to DRS SUSTAINMENT SYSTEMS, INC. 199712!2100!1145!AE07 !USA TANK-AUTOMOTIVE & ARMAMENTS !DAAE0796CX100 !A!*!P00015 !19970324!19981230!006265466!803404102!618957153!N!98255!SYSTEMS & ELECTRONICS INC !201 EVANS LN !SAINT LOUIS !MO!63121!65000!510!29!ST. LOUIS !ST. LOUIS (CITY) !MISSOURI !0001!+000035623500!N!N!000000000000!2330!TRAILERS !A4B!NON-COMBAT VEHICLES !1000!NOT DISCERNABLE OR CLASSIFIED !8711!1!*!*!C!B!A!*!D !U!J!1!0

Who is the contractor on this award?

The obligated recipient is DRS SUSTAINMENT SYSTEMS, INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $34.3 million.

What is the period of performance?

Start: 1997-03-24. End: 2007-07-01.

What is the track record of Systems & Electronics Inc. with the Department of Defense?

The provided data indicates that Systems & Electronics Inc. was awarded this specific contract for trailers. To assess their broader track record, one would need to examine historical contract awards, performance reviews, and any past issues or accolades associated with the company within the Department of Defense or other government agencies. A deeper dive into contract databases like FPDS or SAM.gov would be necessary to understand the volume, value, and types of contracts they have previously held, as well as their performance ratings and any instances of contract disputes or terminations.

How does the awarded amount compare to similar trailer contracts within the DoD?

Benchmarking this $34.3 million contract against similar DoD trailer awards is challenging without access to a broader dataset of comparable contracts. Factors such as trailer size, capacity, specialized features (e.g., environmental controls, armor), and quantity significantly influence price. Given this contract's sole-source nature and long duration (over 10 years), it's difficult to establish a direct apples-to-apples comparison. A comprehensive analysis would require identifying contracts with similar specifications, quantities, and award dates, and then adjusting for inflation and specific technical requirements to determine if the pricing is competitive.

What are the specific risks associated with a sole-source award for military trailers?

The primary risk associated with a sole-source award for military trailers is the potential for inflated pricing due to the lack of competitive pressure. Without multiple bidders vying for the contract, the government may not achieve the most cost-effective outcome. Additionally, sole-source awards can limit access to innovative solutions or alternative technologies that might be offered by other manufacturers. There's also a risk of vendor lock-in, where the government becomes dependent on a single supplier, potentially reducing leverage in future negotiations or facing supply chain vulnerabilities if that supplier encounters difficulties.

How effective is the oversight for long-term, sole-source defense contracts?

The effectiveness of oversight for long-term, sole-source defense contracts hinges on robust contract management practices. Agencies like the DCMA are responsible for monitoring performance, ensuring compliance with terms, and verifying deliverables. For sole-source contracts, particularly those with extended durations, rigorous cost audits, performance metrics tracking, and regular reviews are crucial to mitigate risks of cost overruns and ensure value for money. Transparency can be a challenge, making proactive and diligent oversight by government contracting officers and potentially oversight bodies like Inspectors General essential.

What is the historical spending pattern for trailers within the DoD?

Analyzing historical spending patterns for trailers within the DoD would require accessing comprehensive historical contract data. This would involve querying databases for Product Service Code (PSC) '2330' (Trailers) across various fiscal years and agencies within the Department of Defense. Such an analysis could reveal trends in contract values, average prices per unit, the prevalence of competitive versus sole-source awards, and the primary contractors involved. Understanding these patterns can help contextualize the significance of the $34.3 million award and identify potential areas for cost savings or strategic sourcing in the future.

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: Leonardo SPA (UEI: 428869465)

Address: 201 EVANS LN, SAINT LOUIS, MO, 90

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: YES

Timeline