Navy awards $14.4M for trade services support to Electric Boat Corporation, a sole-source contract

Contract Overview

Contract Amount: $14,368,954 ($14.4M)

Contractor: Electric Boat Corporation

Awarding Agency: Department of Defense

Start Date: 2007-03-30

End Date: 2008-02-29

Contract Duration: 336 days

Daily Burn Rate: $42.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: PROVIDE TRADE SERVICES SUPPORT TAS::17 1804::TAS

Place of Performance

Location: GROTON, NEW LONDON County, CONNECTICUT, 06340

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $14.4 million to ELECTRIC BOAT CORPORATION for work described as: PROVIDE TRADE SERVICES SUPPORT TAS::17 1804::TAS Key points: 1. The contract was awarded on a sole-source basis, raising questions about potential price efficiencies. 2. The duration of 336 days suggests a focused scope of work for trade services. 3. The cost-plus-fixed-fee contract type may incentivize cost management by the contractor. 4. The award falls under the Ship Building and Repairing NAICS code, indicating a specialized industrial service. 5. The contract's value is relatively modest within the broader context of naval shipbuilding and repair.

Value Assessment

Rating: questionable

Benchmarking the value of this specific 'trade services support' contract is challenging without a detailed breakdown of services rendered. However, the sole-source nature of the award limits opportunities for competitive pricing. Comparing it to similar, competitively bid contracts for specialized trade support in shipbuilding could reveal significant price differences. The cost-plus-fixed-fee structure, while common, requires careful oversight to ensure the fixed fee remains reasonable and that costs are managed effectively by the contractor.

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 typically occurs when a specific contractor possesses unique capabilities or is the only responsible source. The lack of competition means there was no direct price comparison through bidding, potentially leading to higher costs for the government compared to a fully competed award.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to drive down prices. The government did not benefit from the price discovery mechanism inherent in a competitive bidding process.

Public Impact

The primary beneficiary is Electric Boat Corporation, a key contractor in the naval shipbuilding sector. The services provided likely support the construction, maintenance, or repair of naval vessels. The geographic impact is concentrated in Connecticut, where Electric Boat Corporation is based. The contract supports skilled labor within the shipbuilding and repair industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases cost to taxpayers.
Cost-plus-fixed-fee contract type requires diligent oversight to manage costs effectively.
Lack of transparency in specific services provided makes value assessment difficult.

Positive Signals

Electric Boat Corporation is a long-standing and experienced contractor for naval programs.
The contract supports critical shipbuilding and repair capabilities for the Navy.
The fixed fee component provides some level of cost certainty for the government.

Sector Analysis

The shipbuilding and repair sector is a critical component of national defense, characterized by high barriers to entry, specialized labor, and significant capital investment. This contract, falling under NAICS code 336611, represents a small portion of the overall spending in this sector. Comparable spending benchmarks would involve analyzing other service contracts for specialized trade support within large shipbuilding programs, which are often awarded to incumbent or sole-source providers due to the integrated nature of these projects.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no information provided regarding subcontracting plans for small businesses. The award to a large, established contractor like Electric Boat Corporation suggests that the primary focus is on specialized capabilities rather than fostering small business participation through this specific award.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures would be tied to the performance requirements outlined in the contract and the cost-plus-fixed-fee structure. Transparency is limited by the sole-source nature and the proprietary details of trade services. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Naval Shipbuilding Programs
Ship Repair and Maintenance Contracts
Defense Industrial Base Support Services

Risk Flags

Sole-source award
Potential for cost overruns in cost-plus contracts
Limited transparency on specific services provided

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.4 million to ELECTRIC BOAT CORPORATION. PROVIDE TRADE SERVICES SUPPORT TAS::17 1804::TAS

Who is the contractor on this award?

The obligated recipient is ELECTRIC BOAT CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $14.4 million.

What is the period of performance?

Start: 2007-03-30. End: 2008-02-29.

What specific trade services were provided under this contract, and how were they essential to naval operations?

The provided data does not detail the specific trade services rendered under contract number 17 1804. However, given the contractor, Electric Boat Corporation, and the NAICS code 336611 (Ship Building and Repairing), these services likely encompassed specialized labor such as welding, pipefitting, electrical work, rigging, or other skilled trades essential for the construction, maintenance, overhaul, or repair of naval vessels, particularly submarines. The necessity of these services stems from the complex and demanding nature of naval shipbuilding and maintenance, requiring highly skilled personnel to ensure the operational readiness and structural integrity of warships.

How does the $14.4 million award compare to typical spending for similar trade services support contracts within the Department of Defense?

Direct comparison of this $14.4 million award for 'trade services support' to similar contracts is difficult without more specific service details and contract types. However, within the context of major naval shipbuilding and repair programs, this value can be considered moderate. Larger, more complex projects involving new construction or major overhauls can run into hundreds of millions or billions of dollars. Smaller, more targeted service contracts, especially those for specialized trades on a sole-source basis, can vary widely. The cost-plus-fixed-fee structure suggests a need for flexibility, which can sometimes lead to higher overall costs than fixed-price contracts if not managed carefully.

What are the primary risks associated with a sole-source award for trade services in the shipbuilding sector?

The primary risk associated with a sole-source award for trade services in the shipbuilding sector is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may not achieve the best possible price. Another risk is reduced incentive for the contractor to innovate or improve efficiency, as they are the only option. Furthermore, reliance on a single source can create vulnerabilities if that contractor experiences performance issues, financial instability, or supply chain disruptions. Ensuring robust oversight and clear performance metrics becomes even more critical in sole-source situations to mitigate these risks.

What is Electric Boat Corporation's track record with the Department of the Navy, particularly concerning contracts of this nature?

Electric Boat Corporation has a long and established track record with the Department of the Navy, primarily as the designer and builder of U.S. Navy submarines. They are a critical part of the nation's submarine industrial base. Their history includes numerous large, complex contracts for submarine construction, maintenance, and modernization. While specific data on their track record for 'trade services support' contracts of this exact nature isn't detailed here, their overall performance history with the Navy is extensive, marked by significant achievements in delivering highly complex and technologically advanced platforms, albeit often involving substantial government investment and oversight.

How has federal spending on shipbuilding and repairing (NAICS 336611) trended over the past decade, and where does this contract fit?

Federal spending on shipbuilding and repairing (NAICS 336611) has historically been substantial, driven by defense appropriations. While specific year-over-year trends fluctuate based on geopolitical factors, shipbuilding programs, and modernization efforts, the sector generally sees significant investment. This $14.4 million contract represents a very small fraction of the total federal spending within this category. It fits within the broader context of maintaining and supporting the naval fleet, likely addressing specific, immediate needs for specialized labor rather than representing a major new program or a large-scale overhaul. Its sole-source nature suggests it addresses a niche requirement.

Industry Classification

NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing

Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0002405R4417

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 75 EASTERN POINT RD, GROTON, CT, 06340

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $14,368,954

Exercised Options: $14,368,954

Current Obligation: $14,368,954

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002405G4417

IDV Type: IDC

Timeline