Kaman Aerospace awarded $875K for ammunition manufacturing, a sole-source contract with a 5-year duration
Contract Overview
Contract Amount: $12,102,613 ($12.1M)
Contractor: Kaman Aerospace Corporation
Awarding Agency: Department of Defense
Start Date: 2007-01-22
End Date: 2012-12-31
Contract Duration: 2,170 days
Daily Burn Rate: $5.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: UCA AWARDED FOR PHASE IA PORTION OF THE CONTRACT, NTE $875,000.00
Place of Performance
Location: MIDDLETOWN, MIDDLESEX County, CONNECTICUT, 06457
Plain-Language Summary
Department of Defense obligated $12.1 million to KAMAN AEROSPACE CORPORATION for work described as: UCA AWARDED FOR PHASE IA PORTION OF THE CONTRACT, NTE $875,000.00 Key points: 1. Contract awarded for ammunition manufacturing services. 2. The contract was not competed, raising questions about price discovery. 3. The duration of the contract is substantial, spanning over five years. 4. The contract is a firm-fixed-price type, which shifts risk to the contractor. 5. The award was made by the Defense Threat Reduction Agency. 6. The North American Industry Classification System (NAICS) code is 332993 for Ammunition (except Small Arms) Manufacturing.
Value Assessment
Rating: questionable
The contract value of $875,000.00 for a 5-year period for ammunition manufacturing is difficult to benchmark without more specific details on the scope of work. Given the sole-source nature of the award, it is challenging to assess whether this represents a fair and reasonable price. Comparisons to similar sole-source contracts for specialized ammunition components or services would be necessary for a more definitive value assessment. The firm-fixed-price structure suggests that cost overruns are the contractor's responsibility, which can be a positive indicator of value if the price was set appropriately.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor possesses the necessary capabilities, technology, or security clearances. The lack of competition means that the government did not benefit from a bidding process that could have driven down prices or spurred innovation. Without a competitive environment, it is harder to ensure the most cost-effective solution was obtained.
Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. The government's ability to negotiate the best possible price is diminished in sole-source situations.
Public Impact
The primary beneficiaries are likely the Department of Defense, specifically the Defense Threat Reduction Agency, which receives the ammunition manufacturing services. The services delivered are related to the manufacturing of ammunition, excluding small arms. The geographic impact is primarily within Connecticut, where Kaman Aerospace Corporation is located. Workforce implications include employment opportunities within Kaman Aerospace for skilled manufacturing and technical personnel.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition and potentially increases costs for taxpayers.
- Lack of transparency in the procurement process due to non-competitive award.
- Long contract duration (over 5 years) could lock in potentially suboptimal pricing if market conditions change.
Positive Signals
- Firm-fixed-price contract shifts performance risk to the contractor.
- Award to an established aerospace corporation suggests potential for reliable delivery.
- Specific focus on ammunition manufacturing indicates a specialized capability meeting a critical defense need.
Sector Analysis
The ammunition manufacturing sector is a critical component of the defense industrial base. Companies in this sector produce a wide range of ordnance, from small-caliber rounds to large-caliber munitions. The NAICS code 332993 specifically covers the manufacturing of ammunition, excluding small arms. This contract fits within the broader defense manufacturing landscape, where specialized capabilities are often required. Benchmarking this contract's value is challenging without knowing the exact type and quantity of ammunition, but the overall defense spending on munitions is substantial.
Small Business Impact
This contract was not set aside for small businesses, and Kaman Aerospace Corporation is a large business. There is no indication of subcontracting requirements for small businesses in the provided data. Therefore, this award does not directly benefit the small business ecosystem through set-asides or mandated subcontracting.
Oversight & Accountability
Oversight for this contract would fall under the Department of Defense and the Defense Threat Reduction Agency. As a sole-source award, the justification for this procurement method would be subject to review. Accountability measures would involve performance monitoring against the firm-fixed-price contract terms. Transparency is limited due to the non-competitive nature of the award, though contract details are generally available through federal procurement databases.
Related Government Programs
- Defense Ammunition Procurement
- Ordnance Manufacturing Contracts
- Defense Threat Reduction Agency Contracts
- Aerospace Manufacturing Services
Risk Flags
- Sole-source award
- Lack of competition
- Potential for inflated pricing
Tags
defense, department-of-defense, ammunition-manufacturing, kaman-aerospace-corporation, sole-source, firm-fixed-price, connecticut, defense-threat-reduction-agency, ammunition-except-small-arms-manufacturing, large-business
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $12.1 million to KAMAN AEROSPACE CORPORATION. UCA AWARDED FOR PHASE IA PORTION OF THE CONTRACT, NTE $875,000.00
Who is the contractor on this award?
The obligated recipient is KAMAN AEROSPACE CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Threat Reduction Agency).
What is the total obligated amount?
The obligated amount is $12.1 million.
What is the period of performance?
Start: 2007-01-22. End: 2012-12-31.
What specific types and quantities of ammunition are covered under this contract?
The provided data indicates the contract is for 'Ammunition (except Small Arms) Manufacturing' under NAICS code 332993. However, the specific types and quantities of ammunition are not detailed in the summary information. This level of detail is crucial for understanding the scope of work, assessing the value for money, and comparing it to other contracts. Without this information, it's difficult to determine if the $875,000 ceiling is appropriate for the intended deliverables. Further investigation into the contract's statement of work would be required to ascertain these specifics.
What was the justification for awarding this contract on a sole-source basis?
Sole-source awards are typically justified when only one responsible source is available or capable of meeting the agency's needs. For ammunition manufacturing, this could be due to proprietary technology, unique manufacturing processes, specialized security requirements, or existing infrastructure that is difficult or impossible to replicate. The Defense Threat Reduction Agency would have had to document and approve this justification, likely citing factors such as unique capabilities possessed by Kaman Aerospace, the need for specialized tooling or expertise, or the urgency of the requirement that precluded a competitive process. The specific justification would be found in the contract's award documentation.
How does the $875,000 ceiling compare to typical contract values for similar ammunition manufacturing services?
Benchmarking the $875,000 ceiling against similar contracts is challenging without knowing the precise nature of the ammunition and the scope of manufacturing services. Ammunition contracts can range from small orders for specialized components to large-scale production runs. Given this is a ceiling value over a 5-year period (2170 days), the average annual value is approximately $175,000. This suggests a relatively niche or low-volume requirement, or perhaps a contract for specific components or services rather than full-scale production. Without more granular data on the type of ammunition and the services provided, a direct comparison to market rates or other federal contracts is speculative.
What is Kaman Aerospace Corporation's track record with the Department of Defense, particularly in ammunition manufacturing?
Kaman Aerospace Corporation has a long history of contracting with the Department of Defense, primarily in areas related to aerospace components, systems, and support. While their core business often involves complex aerospace structures and systems, they may also possess capabilities or have acquired subsidiaries involved in specialized manufacturing, which could include certain types of ordnance or related components. A review of their contract history would reveal the extent and nature of their involvement in ammunition production. Their established presence within the defense sector suggests a level of familiarity with DoD requirements and processes.
What are the potential risks associated with a sole-source, firm-fixed-price contract for ammunition manufacturing?
A primary risk of a sole-source contract is the potential for inflated pricing due to the lack of competition. While the firm-fixed-price (FFP) structure shifts cost overrun risk to the contractor, the initial price negotiation is critical. If the government did not negotiate a sufficiently competitive price because there was no other option, taxpayers could bear a higher cost. Another risk is contractor performance; if Kaman Aerospace faces unforeseen production issues, the FFP contract might incentivize cutting corners on quality, although quality assurance measures should mitigate this. The long duration also poses a risk if technology or requirements change significantly over the contract period.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Kaman Corp (UEI: 001155225)
Address: 217 SMITH ST, MIDDLETOWN, CT, 90
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $12,532,078
Exercised Options: $12,532,078
Current Obligation: $12,102,613
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2007-01-22
Current End Date: 2012-12-31
Potential End Date: 2012-12-31 00:00:00
Last Modified: 2012-01-18
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