DoD's $25.3M transportation contract with Crowley Logistics shows strong competition and fair pricing

Contract Overview

Contract Amount: $25,343,396 ($25.3M)

Contractor: Crowley Logistics, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-02-01

End Date: 2024-02-29

Contract Duration: 28 days

Daily Burn Rate: $905.1K/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 $25.3 million to CROWLEY LOGISTICS, INC. for work described as: CONSOLIDATED TRANSPORTATION SHIPMENTS MADE BY DECENTRALIZED ORDERING OFFICERS Key points: 1. Value for money appears strong given the competitive nature of the award. 2. The contract was awarded through full and open competition, indicating a healthy market. 3. Risk indicators are low, with a fixed-price contract type and a short duration. 4. Performance context is limited to a single month, making long-term assessment difficult. 5. This contract fits within the broader Defense transportation and logistics sector. 6. The award amount is moderate within the context of federal transportation spending.

Value Assessment

Rating: good

The contract value of $25.3 million for a one-month delivery order suggests a reasonable price for freight transportation arrangement services. Benchmarking against similar contracts is challenging without more detailed service scope, but the competitive award process implies that the pricing is likely aligned with market rates. The fixed-price with economic price adjustment structure offers some protection against unforeseen cost increases while maintaining a degree of cost certainty.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors were likely invited to bid. The specific number of bidders is not provided, but the method of competition suggests a robust marketplace for these services. This level of competition is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: Taxpayers benefit from full and open competition as it drives down prices and increases the likelihood of securing services at the most economical rates.

Public Impact

The Department of Defense benefits from reliable and efficient transportation services for its logistical needs. This contract supports the movement of goods essential for military operations. The primary geographic impact is within Florida, where the shipments originated or were destined. Workforce implications are likely related to logistics and transportation personnel employed by Crowley Logistics and its partners.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded through full and open competition.
Fixed-price contract type with economic price adjustment provides cost predictability.
Short contract duration minimizes long-term financial exposure.
Contractor is a known entity in the logistics space.

Sector Analysis

The federal transportation and logistics sector is a critical component of government operations, encompassing a wide range of services from freight movement to supply chain management. This contract falls under freight transportation arrangement, a segment that facilitates the efficient movement of goods for various agencies. Comparable spending benchmarks in this area are vast, with agencies like DoD, GSA, and DOT awarding billions annually for logistics and transportation services.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the nature of large-scale logistics, it's possible that smaller businesses could be involved as subcontractors to Crowley Logistics, but this is not explicitly stated. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of USTRANSCOM, the awarding agency. Accountability measures are inherent in the contract terms, including performance requirements and payment schedules. Transparency is facilitated by the public nature of federal contract awards, though detailed operational data may be sensitive.

Related Government Programs

USTRanscom Logistics Services
Department of Defense Freight Transportation
Federal Supply Chain Management
Government Freight Shipping Contracts

Risk Flags

Short contract duration limits long-term performance assessment.
Economic price adjustment introduces potential for cost increases.
Limited detail on specific services rendered and performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.3 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 $25.3 million.

What is the period of performance?

Start: 2024-02-01. End: 2024-02-29.

What is the track record of Crowley Logistics, Inc. with the Department of Defense?

Crowley Logistics, Inc. has a history of performing contracts with the Department of Defense, particularly within the USTRANSCOM domain. While this specific contract is for a short duration (28 days), the company's broader experience in military logistics, including ocean transportation, chartering, and freight forwarding, suggests a capacity to meet DoD requirements. Analyzing past performance on similar, larger-scale contracts would provide a more comprehensive view of their reliability, cost-effectiveness, and adherence to delivery schedules. However, the award of this current contract indicates a level of trust and demonstrated capability by the DoD.

How does the value of this contract compare to similar federal freight transportation arrangements?

The $25.3 million value for a single month of freight transportation arrangement services is substantial, reflecting the scale and complexity of moving goods for a major entity like the Department of Defense. Without specific details on the volume, type of goods, and origin/destination points, a direct comparison is difficult. However, federal agencies, particularly DoD, frequently award multi-million dollar contracts for transportation and logistics. This contract's value appears to be within the expected range for significant logistical support, especially considering it covers a full month's operations. The competitive bidding process suggests the price achieved is likely market-aligned.

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

The primary risks associated with this contract include potential disruptions in service delivery, cost overruns due to economic price adjustments, and performance failures. Mitigation strategies are embedded within the contract structure. The fixed-price nature with economic price adjustment helps manage cost volatility. The short duration of 28 days limits the long-term financial exposure and the window for significant performance issues. Furthermore, the award through full and open competition implies that the contractor has demonstrated capability, reducing the risk of non-performance. USTRANSCOM's oversight would also play a role in monitoring performance and addressing any emerging issues.

How effective is the 'full and open competition' approach for securing freight transportation services?

The 'full and open competition' approach is generally considered the most effective method for securing freight transportation services, as it maximizes the pool of potential bidders and fosters a competitive environment. This typically leads to better pricing, improved service quality, and innovative solutions. For freight transportation, where market capacity can fluctuate, allowing all responsible sources to compete ensures the government can access the best available resources at optimal costs. The success of this approach is contingent on clear solicitation requirements and a fair evaluation process, which are standard in federal contracting.

What is the historical spending trend for freight transportation arrangements by USTRANSCOM?

Historical spending trends for freight transportation arrangements by USTRANSCOM are substantial, reflecting its critical role in global military logistics. USTRANSCOM manages a vast network of transportation services, and annual spending often runs into the billions of dollars. Contracts for freight arrangement services, like the one awarded to Crowley Logistics, are a recurring necessity. While this specific $25.3 million award is for a single month, it represents a component of a much larger, ongoing expenditure. Analyzing year-over-year spending patterns for similar service categories would reveal trends in demand, pricing, and contractor utilization.

What are the implications of the 'economic price adjustment' clause in this fixed-price contract?

The 'economic price adjustment' (EPA) clause in this fixed-price contract allows for adjustments to the contract price based on fluctuations in specific economic factors, such as fuel costs or labor rates. For taxpayers, this clause introduces a degree of uncertainty regarding the final cost, as the price could increase beyond the initial fixed amount if these economic indicators rise significantly. However, it also serves to protect the contractor from unforeseen market volatility, which could otherwise lead to contract disputes or service disruptions. The effectiveness of the EPA depends on the specific indices used and the caps or limitations placed on adjustments, aiming to balance cost certainty for the government with risk mitigation for the contractor.

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: $25,343,396

Exercised Options: $25,343,396

Current Obligation: $25,343,396

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71117DR003

IDV Type: IDC

Timeline