DoD's $31.7M contract for armored vehicles awarded to Ultra Armoring, LLC, with limited competition

Contract Overview

Contract Amount: $31,689,694 ($31.7M)

Contractor: Ultra Armoring, LLC

Awarding Agency: Department of Defense

Start Date: 2015-07-02

End Date: 2015-10-30

Contract Duration: 120 days

Daily Burn Rate: $264.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TOYOTA LAND CRUISER TYPE 79 PICK-UPS&TATAS

Place of Performance

Location: KINGSTOWN, CLEVELAND County, NORTH CAROLINA, 28150

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $31.7 million to ULTRA ARMORING, LLC for work described as: TOYOTA LAND CRUISER TYPE 79 PICK-UPS&TATAS Key points: 1. The contract value represents a significant investment in specialized vehicle procurement. 2. Limited competition may have influenced the final pricing and value for money. 3. The short performance period suggests a specific, time-sensitive operational need. 4. The use of a definitive contract indicates a pre-negotiated agreement for goods. 5. The firm-fixed-price structure aims to control costs for the government. 6. The procurement falls under automobile manufacturing, highlighting a niche industrial sector.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to the specialized nature of armored vehicles. The reported value of $31.7 million for 5 units suggests a high per-unit cost, which is expected for custom-built armored vehicles. However, without detailed specifications and comparisons to similar custom armoring contracts, a definitive assessment of value for money is difficult. The price appears high on a per-unit basis, but this may be justified by the advanced protection and customization required.

Cost Per Unit: Approximately $6.34 million per vehicle (5 units / $31,689,693.97). This is likely within the expected range for highly specialized, armored vehicles, but direct comparisons are difficult without more specific contract details.

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while the initial intent was open competition, specific sources were later excluded. This suggests a limited pool of eligible bidders, potentially impacting the breadth of competition. With only 5 vehicles procured, the scale might not have attracted a wide array of bidders, further contributing to limited competition. The limited competition raises questions about whether the government secured the most competitive pricing possible.

Taxpayer Impact: Limited competition can lead to higher prices for taxpayers as fewer vendors compete, potentially reducing the incentive for aggressive bidding and cost savings.

Public Impact

Special Operations Command personnel benefit from enhanced protection through these specialized vehicles. The contract delivers highly customized, armored vehicles designed for demanding operational environments. The geographic impact is likely global, supporting special operations missions wherever deployed. The procurement supports specialized manufacturing jobs within the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may have resulted in a higher price than could have been achieved through broader bidding.
The high per-unit cost, while potentially justified, warrants scrutiny to ensure optimal use of funds.
Lack of detailed public information on the specific armoring and features makes independent value assessment difficult.

Positive Signals

Firm-fixed-price contract type helps control costs and provides budget certainty.
Award to a specialized vendor like Ultra Armoring suggests access to specific expertise for critical needs.
The procurement addresses a clear operational requirement for protected mobility.

Sector Analysis

The defense sector's vehicle procurement often involves specialized, high-cost items like armored vehicles. This contract fits within the broader category of defense logistics and equipment, where custom manufacturing and advanced protection are paramount. The market for such specialized vehicles is relatively small, dominated by a few key players capable of meeting stringent military specifications. Spending in this niche is driven by operational requirements and threat assessments, often resulting in significant per-unit costs.

Small Business Impact

The contract data indicates that small business participation was not a primary focus, as the award was made to Ultra Armoring, LLC, and there is no indication of small business set-asides or subcontracting requirements mentioned. The nature of specialized armored vehicle manufacturing typically involves larger, established firms with the necessary infrastructure and expertise, potentially limiting opportunities for smaller businesses in direct prime contracting.

Oversight & Accountability

Oversight for this contract would fall under the Department of Defense's existing procurement regulations and contract management processes. The U.S. Special Operations Command is responsible for ensuring contract compliance and performance. Transparency is limited by the nature of defense procurements, but contract awards are generally reported. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Tactical Wheeled Vehicles
Armored Personnel Carriers
Special Operations Forces Equipment
Defense Vehicle Procurement
Automotive Manufacturing Contracts

Risk Flags

Limited competition may lead to higher costs.
High per-unit cost warrants value assessment.
Specialized nature of product may limit future options.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.7 million to ULTRA ARMORING, LLC. TOYOTA LAND CRUISER TYPE 79 PICK-UPS&TATAS

Who is the contractor on this award?

The obligated recipient is ULTRA ARMORING, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (U.S. Special Operations Command).

What is the total obligated amount?

The obligated amount is $31.7 million.

What is the period of performance?

Start: 2015-07-02. End: 2015-10-30.

What is the track record of Ultra Armoring, LLC in fulfilling government contracts, particularly for armored vehicles?

Information on Ultra Armoring, LLC's specific track record with government contracts, especially for armored vehicles, is not extensively detailed in the provided data. As a specialized manufacturer, their history would likely involve fulfilling orders for similar high-security vehicles. A deeper dive would require examining past performance reviews, delivery timelines, and any documented issues or successes on previous contracts with DoD or other federal agencies. The limited competition aspect might suggest a known entity within this niche, but without explicit performance data, assessing their reliability and quality is speculative. Further research into contract databases and agency performance reports would be necessary to build a comprehensive picture of their track record.

How does the per-unit cost of these armored vehicles compare to similar government procurements?

The per-unit cost for these Toyota Land Cruiser Type 79 Pick-ups & Tetas, armored by Ultra Armoring, LLC, is approximately $6.34 million ($31,689,693.97 / 5 units). This figure is exceptionally high and suggests a highly specialized, custom-built vehicle. Comparing this to similar procurements is challenging without knowing the exact specifications, level of armor, and intended use. However, typical armored vehicles for military or law enforcement can range from hundreds of thousands to several million dollars, depending on the base platform, protection level (e.g., STANAG levels), and integrated systems. For context, some MRAP (Mine-Resistant Ambush Protected) vehicles procured by the DoD have had per-unit costs in the range of $500,000 to $1 million, though these are often mass-produced and may have different protection profiles. The $6.34 million figure likely reflects a very specific, low-volume, high-protection requirement.

What are the primary risks associated with this contract, given the limited competition and specialized nature of the product?

The primary risks associated with this contract stem from the limited competition and the specialized nature of the armored vehicles. Limited competition increases the risk of paying a premium price, as Ultra Armoring, LLC may have faced less pressure to offer the most competitive bid. There's also a risk related to vendor lock-in or dependency if few other companies can produce vehicles to these exact specifications. Furthermore, the specialized nature means that if issues arise with performance, maintenance, or future upgrades, finding alternative solutions or contractors could be difficult and costly. The short performance period (120 days) also introduces a risk of delivery delays or quality compromises if the contractor faces unforeseen production challenges.

How effective is the firm-fixed-price contract type in managing costs for this specific procurement?

The firm-fixed-price (FFP) contract type is generally effective in managing costs for procurements where the scope of work is well-defined and risks are understood. For this contract, procuring specific armored vehicles suggests a clear set of requirements. FFP shifts the risk of cost overruns to the contractor, providing the government with budget certainty. This means the $31.7 million is the ceiling price, and the contractor is incentivized to complete the work within that budget to maximize profit. However, the effectiveness can be diminished if the initial price was not competitively determined due to limited bidding, or if unforeseen technical challenges arise that were not adequately accounted for in the contractor's pricing.

What does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' designation imply about the procurement process?

The designation 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' implies a multi-stage procurement process. Initially, the solicitation was intended for full and open competition, meaning all responsible sources were encouraged to submit offers. However, at some point during the process, specific sources were excluded. This exclusion could be due to various reasons, such as failure to meet minimum requirements, specific security concerns, or a determination that only certain vendors possessed the unique capabilities needed. While it started with broad competition, the exclusion narrows the field, making the final competition 'limited' in practice. This approach is used when agencies believe a broader competition is possible but specific criteria must be met, or when certain vendors are disqualified based on established rules.

Industry Classification

NAICS: Manufacturing › Motor Vehicle Manufacturing › Automobile Manufacturing

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: H9222215R0044

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ultra Machine & Fabrication, Inc. (UEI: 626381800)

Address: 2501 W DIXON BLVD, SHELBY, NC, 28150

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $60,364,978

Exercised Options: $31,689,694

Current Obligation: $31,689,694

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline