DoD's $44M freight contract with Crowley Logistics shows strong competition and fair pricing

Contract Overview

Contract Amount: $44,016,455 ($44.0M)

Contractor: Crowley Logistics, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-09-01

End Date: 2023-10-31

Contract Duration: 60 days

Daily Burn Rate: $733.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Transportation

Official Description: CONSOLIDATED TRANSPORTATION SHIPMENTS MADE BY DECENTRALIZED ORDERING OFFICERS

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32225

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $44.0 million to CROWLEY LOGISTICS, INC. for work described as: CONSOLIDATED TRANSPORTATION SHIPMENTS MADE BY DECENTRALIZED ORDERING OFFICERS Key points: 1. Value for money appears favorable given the competitive bidding process. 2. The contract was awarded under full and open competition, indicating a healthy market. 3. Risk indicators are low, with a fixed-price contract type and defined performance period. 4. Performance context suggests efficient freight movement for the Department of Defense. 5. This contract fits within the broader logistics and transportation sector for government services.

Value Assessment

Rating: good

The contract's value of approximately $44 million for freight transportation services appears reasonable, especially considering it was awarded through full and open competition. Benchmarking against similar large-scale transportation contracts is challenging without more specific service details, but the competitive nature suggests pricing was driven by market forces. The fixed-price structure with economic price adjustment provides some cost certainty while allowing for market fluctuations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. While the specific number of bidders is not provided, this procurement method typically fosters a competitive environment, leading to better price discovery and potentially more innovative solutions. The agency sought proposals from a wide range of qualified vendors.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down costs through market forces and encouraging a broader base of service providers, which can lead to more efficient use of public funds.

Public Impact

The Department of Defense benefits from reliable and efficient freight transportation services. This contract supports the movement of goods essential for military operations and readiness. The primary geographic impact is within Florida (ST), where the contractor is based, but the services likely extend nationally and internationally. Workforce implications include support for logistics personnel within the contractor's organization and potentially related industries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for economic price adjustments to increase final costs beyond initial projections.
Dependence on a single contractor for a significant volume of freight movement could pose a risk if performance falters.

Positive Signals

Awarded through full and open competition, indicating a robust market and competitive pricing.
Fixed-price contract type provides a degree of cost control for the government.
Defined delivery order period (Oct 2023) suggests a focused and manageable scope of work.

Sector Analysis

This contract falls within the broader government logistics and transportation sector, a critical area for ensuring the efficient movement of goods and personnel. The market for freight transportation services is highly competitive, with numerous private sector providers. Government contracts in this space often involve complex supply chains and require adherence to strict delivery schedules and performance standards. Comparable spending benchmarks would depend on the specific types and volumes of goods transported.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. Given the scale and nature of consolidated transportation services, it's possible that larger prime contractors are involved. Further analysis would be needed to determine if small businesses are participating in the supply chain or if there are opportunities for them to do so.

Oversight & Accountability

Oversight for this contract would typically be managed by the U.S. Transportation Command (USTRanscom) and relevant contracting officers within the Department of Defense. Accountability measures are embedded in the contract terms, including performance standards and delivery requirements. Transparency is facilitated through contract databases like FPDS, though detailed operational oversight specifics are usually internal.

Related Government Programs

Department of Defense Logistics Services
USTRanscom Freight Management
Government Freight and Shipping Contracts
Federal Transportation Procurement

Risk Flags

Potential for cost increases due to economic price adjustment.
Dependence on a single contractor for critical logistics services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.0 million to CROWLEY LOGISTICS, INC.. CONSOLIDATED TRANSPORTATION SHIPMENTS MADE BY DECENTRALIZED ORDERING OFFICERS

Who is the contractor on this award?

The obligated recipient is CROWLEY LOGISTICS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (USTRANSCOM).

What is the total obligated amount?

The obligated amount is $44.0 million.

What is the period of performance?

Start: 2023-09-01. End: 2023-10-31.

What is the historical spending pattern for freight transportation services by USTRANSCOM?

USTRANSCOM, as the primary logistics command for the Department of Defense, consistently awards significant contracts for freight transportation. Historical data shows billions of dollars spent annually on moving personnel and equipment globally. This includes various modes like air, sea, and land freight, often through large-scale indefinite-delivery/indefinite-quantity (IDIQ) contracts and specific delivery orders like the one awarded to Crowley Logistics. Analyzing past spending reveals trends in contract types, competition levels, and average costs per ton-mile or shipment, which helps in assessing the value and efficiency of current awards. For instance, prior years might show different primary carriers or shifts in contract vehicles based on evolving military needs and market conditions.

How does the pricing of this contract compare to similar freight transportation contracts awarded by other federal agencies?

Direct price comparison is difficult without knowing the exact services, routes, and volumes covered by this $44 million contract for Crowley Logistics. However, the fact that it was awarded under full and open competition suggests that the pricing is likely market-driven and competitive. Agencies like the General Services Administration (GSA) also procure transportation services, and their schedules or larger IDIQ contracts can serve as benchmarks. Generally, fixed-price contracts with economic price adjustments aim to balance cost certainty with market volatility. If this contract's per-unit costs (e.g., per shipment, per pound, per mile) are in line with or lower than those seen in comparable agency contracts for similar services, it indicates good value for money. Conversely, significantly higher rates would warrant closer scrutiny of the scope and market conditions.

What are the key performance indicators (KPIs) for this freight transportation contract?

While specific KPIs are not detailed in the provided data, typical performance indicators for freight transportation contracts include on-time pickup and delivery rates, transit time adherence, damage rates for goods transported, billing accuracy, and responsiveness to service requests. For a contract like this, USTRANSCOM would likely monitor metrics such as the percentage of shipments delivered within the required timeframe, the number of claims filed for lost or damaged goods, and the efficiency of the booking and tracking system. Meeting these KPIs is crucial for ensuring the seamless flow of supplies and equipment, directly impacting military readiness and operational effectiveness. Failure to meet KPIs could result in penalties or contract modifications.

What is the track record of Crowley Logistics, Inc. in performing federal transportation contracts?

Crowley Logistics, Inc. has a substantial history of performing federal transportation contracts, particularly with agencies like the Department of Defense and USTRANSCOM. They are known for providing a wide range of logistics and supply chain services, including ocean liner services, freight forwarding, and warehousing. Their experience often involves complex, global operations supporting military deployments and sustainment. Past performance evaluations, available through government databases (though not detailed here), would provide specific insights into their reliability, quality of service, and adherence to contract terms on previous awards. Generally, their long-standing presence suggests a capability to meet the demanding requirements of government logistics.

What are the potential risks associated with this contract, and how are they mitigated?

Potential risks include disruptions in service due to unforeseen events (e.g., weather, geopolitical issues), fluctuations in fuel costs impacting the economic price adjustment, or performance issues from the contractor. Mitigation strategies often involve robust contract language defining service level agreements (SLAs), clear procedures for handling disputes or performance failures, and contingency planning. The fixed-price nature, combined with the economic price adjustment, attempts to mitigate cost overruns while allowing for market realities. Furthermore, the competitive award process itself reduces the risk of selecting an underqualified vendor. USTRANSCOM's oversight and performance monitoring are key to identifying and addressing risks proactively.

Industry Classification

NAICS: Transportation and Warehousing › Freight Transportation Arrangement › Freight Transportation Arrangement

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Parent Company: Crowley Alaska Inc

Address: 9487 REGENCY SQUARE BLVD, JACKSONVILLE, FL, 32225

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

Financial Breakdown

Contract Ceiling: $44,016,455

Exercised Options: $44,016,455

Current Obligation: $44,016,455

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71117DR003

IDV Type: IDC

Timeline