DoD's $259M LHD 7 Dry-Docking Contract Awarded to Metro Machine Corp
Contract Overview
Contract Amount: $258,959,199 ($259.0M)
Contractor: Metro Machine Corp.
Awarding Agency: Department of Defense
Start Date: 2021-12-22
End Date: 2024-05-13
Contract Duration: 873 days
Daily Burn Rate: $296.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: USS IWO JIMA (LHD 7) FY22 DRY-DOCKING SELECTED RESTRICTED AVAILABILITY
Place of Performance
Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23523
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $259.0 million to METRO MACHINE CORP. for work described as: USS IWO JIMA (LHD 7) FY22 DRY-DOCKING SELECTED RESTRICTED AVAILABILITY Key points: 1. Significant investment in naval vessel maintenance. 2. Metro Machine Corp. secured a large contract. 3. Potential for cost overruns in long-term availability contracts. 4. Shipbuilding and Repair sector sees substantial activity.
Value Assessment
Rating: fair
The contract value of $258.96 million for an 873-day availability period appears substantial. Benchmarking against similar complex naval dry-docking and repair contracts is necessary to assess true value, as pricing can vary widely based on scope and urgency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. This method generally promotes price discovery and potentially better pricing for the government compared to sole-source or limited competition.
Taxpayer Impact: Taxpayers benefit from competitive bidding, which aims to secure the best possible price for essential naval maintenance services.
Public Impact
Ensures operational readiness of a key naval asset. Supports jobs in the shipbuilding and repair industry. Impacts the Navy's ability to project power.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration increases risk of scope creep and cost escalation.
- Potential for unforeseen technical issues during extensive repairs.
- Dependence on a single contractor for a critical asset.
Positive Signals
- Full and open competition should drive competitive pricing.
- Firm Fixed Price contract provides cost certainty.
- Contract supports critical naval infrastructure.
Sector Analysis
This contract falls within the shipbuilding and repair sector, a critical component of national defense. Spending benchmarks for similar large-scale naval vessel availabilities are typically in the tens to hundreds of millions of dollars, depending on the vessel class and scope of work.
Small Business Impact
While the primary awardee is Metro Machine Corp., the contract's extensive scope may involve subcontracting opportunities for small businesses in specialized repair and supply areas. Further analysis would be needed to determine the extent of small business participation.
Oversight & Accountability
The Department of the Navy is responsible for overseeing this contract. Robust oversight is crucial to manage the long duration, ensure adherence to specifications, and control costs throughout the availability period.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Long contract duration (873 days) increases risk.
- Potential for unforeseen technical challenges.
- Dependence on a single contractor for critical maintenance.
- Complexity of naval vessel repair.
Tags
ship-building-and-repairing, department-of-defense, va, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $259.0 million to METRO MACHINE CORP.. USS IWO JIMA (LHD 7) FY22 DRY-DOCKING SELECTED RESTRICTED AVAILABILITY
Who is the contractor on this award?
The obligated recipient is METRO MACHINE CORP..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $259.0 million.
What is the period of performance?
Start: 2021-12-22. End: 2024-05-13.
What is the historical cost performance of Metro Machine Corp. on similar large-scale naval repair contracts?
Assessing Metro Machine Corp.'s past performance on comparable contracts is vital. Reviewing their track record for on-time delivery, budget adherence, and quality of work on previous large naval availabilities provides insight into their capability and reliability. This historical data helps predict potential risks and validate the current contract's pricing and timeline.
How does the scope of work for this availability compare to industry standards for LHD-class dry-docking?
Comparing the defined scope of work against industry benchmarks for LHD-class dry-docking and repair is essential. Understanding if this availability includes standard maintenance or extensive upgrades helps contextualize the $259 million price tag. Deviations from standard scopes could indicate potential cost drivers or areas for negotiation.
What mechanisms are in place to manage potential cost increases due to unforeseen issues during the 873-day availability?
Given the long duration and complexity of naval vessel repairs, unforeseen issues are probable. The contract's oversight plan should detail contingency funds, change order procedures, and dispute resolution processes. Effective management of these mechanisms is critical to prevent budget overruns and ensure the project stays within the firm fixed price, or that any deviations are well-justified.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › NON-NUCLEAR SHIP REPAIR
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0002421R4490
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Wico Limited
Address: 200 LIGON ST, NORFOLK, VA, 23523
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $358,212,320
Exercised Options: $258,959,199
Current Obligation: $258,959,199
Actual Outlays: $215,765,787
Subaward Activity
Number of Subawards: 80
Total Subaward Amount: $92,394,476
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2021-12-22
Current End Date: 2024-05-13
Potential End Date: 2024-05-13 00:00:00
Last Modified: 2025-04-29
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