DoD awards $119.5M for guided missile components, with limited competition impacting price discovery

Contract Overview

Contract Amount: $11,951,410 ($12.0M)

Contractor: General Dynamics Mission Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2004-07-02

End Date: 2007-03-30

Contract Duration: 1,001 days

Daily Burn Rate: $11.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200410!00A257!1700!XSP01 !STRATEGIC SYSTEMS PROGRAMS !N0003004C0041 !A!N! !N! ! !20040702!20050930!847075769!003587024!001381284!N!GENERAL DYNAMICS DEFENSE SYSTE!100 PLASTICS AVE !PITTSFIELD !MA!01201!53960!003!25!PITTSFIELD !BERKSHIRE !MASS !+000006979444!N!N!000000000000!1420!GUIDED MISSILE COMPONENTS !A2 !MISSILE AND SPACE SYSTEMS !178 !TRIDENT II MISSILE !541330!E! !3! ! ! ! ! !99990909!B!D!N!A! !D!N!U!1!001!N!1A!Z!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: PITTSFIELD, BERKSHIRE County, MASSACHUSETTS, 01201

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $12.0 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: 200410!00A257!1700!XSP01 !STRATEGIC SYSTEMS PROGRAMS !N0003004C0041 !A!N! !N! ! !20040702!20050930!847075769!003587024!001381284!N!GENERAL DYNAMICS DEFENSE SYSTE!100 PLASTICS AVE !PITTSFIELD !MA!01201!53960!003!25!PITTSFIELD !BERK… Key points: 1. Contract awarded for critical missile components, highlighting specialized defense manufacturing needs. 2. Limited competition suggests potential for higher costs and reduced taxpayer value. 3. Contract duration of over 1000 days indicates a long-term need for these specialized parts. 4. The awardee has a significant role in defense systems, suggesting established expertise. 5. Engineering services are a key component, pointing to complex technical requirements. 6. Geographic concentration in Massachusetts for this contract.

Value Assessment

Rating: fair

The contract value of $119.5 million for engineering services related to guided missile components appears substantial. Benchmarking this against similar contracts is challenging without more specific details on the exact components and services rendered. However, the 'NOT COMPETED' status raises concerns about whether the government achieved the best possible price. The cost-plus-fixed-fee structure can also lead to cost overruns if not managed tightly.

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. This typically occurs when only one responsible source can provide the required goods or services. While this can ensure specialized capabilities are met, it significantly limits price discovery and potentially leads to higher costs for the government.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from competitive pricing, potentially leading to a less efficient use of public funds.

Public Impact

Benefits the Department of Defense by providing essential components for strategic missile systems. Ensures the continued readiness and operational capability of the U.S. ballistic missile fleet. Supports specialized manufacturing and engineering jobs within the defense industrial base. Impacts the strategic defense sector by maintaining critical supply chains for advanced weaponry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated costs for taxpayers.
Sole-source nature limits opportunities for new or smaller businesses to enter the supply chain.
Cost-plus-fixed-fee contract type can incentivize cost increases if not rigorously overseen.

Positive Signals

Awardee is a known entity in defense systems, suggesting reliability.
Contract addresses a critical national security need for missile components.
Long-term contract indicates a stable demand for these specialized services.

Sector Analysis

This contract falls within the Defense sector, specifically focusing on missile and space systems. The market for such specialized components is typically dominated by a few large, established defense contractors due to high barriers to entry, including technological expertise, security clearances, and manufacturing capabilities. Spending in this sub-sector is driven by national security priorities and ongoing modernization efforts for strategic weapon systems.

Small Business Impact

The 'NOT COMPETED' and sole-source nature of this award suggests limited opportunities for small businesses to participate directly as prime contractors. Subcontracting opportunities may exist, but they are dependent on the prime contractor's procurement strategy. Without a small business set-aside or a competitive bidding process, the direct impact on the small business ecosystem for this specific contract is likely minimal.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contract management agencies, such as the Defense Contract Management Agency (DCMA). Accountability measures would be embedded in the contract terms, including performance metrics and financial reporting. Transparency is limited due to the sole-source nature, but contract awards are generally reported in federal procurement databases.

Related Government Programs

Trident II Missile Program
Strategic Systems Programs
Guided Missile Manufacturing
Defense Engineering Services

Risk Flags

Sole-source award limits competition
Cost-plus-fixed-fee contract type can lead to cost overruns
Lack of transparency in pricing due to non-competitive award

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.0 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. 200410!00A257!1700!XSP01 !STRATEGIC SYSTEMS PROGRAMS !N0003004C0041 !A!N! !N! ! !20040702!20050930!847075769!003587024!001381284!N!GENERAL DYNAMICS DEFENSE SYSTE!100 PLASTICS AVE !PITTSFIELD !MA!01201!53960!003!25!PITTSFIELD !BERKSHIRE !MASS !+000006979444!N!N!000000000000!1420!GUIDED MISSILE COMPONENTS !A2 !MISSILE AND SPACE SYSTEMS !178 !TRIDENT II MISSILE !541330!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS MISSION SYSTEMS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $12.0 million.

What is the period of performance?

Start: 2004-07-02. End: 2007-03-30.

What is the specific nature of the 'Guided Missile Components' being procured under this contract?

The provided data indicates the contract is for 'GUIDED MISSILE COMPONENTS' under the PSC code 541330 (Engineering Services) and NAICS code 541330. While the exact components are not detailed, the context of 'TRIDENT II MISSILE' and 'STRATEGIC SYSTEMS PROGRAMS' suggests these are highly specialized, critical parts for a major strategic weapon system. This could include complex sub-assemblies, guidance system parts, or structural elements requiring advanced materials and manufacturing processes.

How does the 'Cost Plus Fixed Fee' (CPFF) contract type typically affect project costs and contractor incentives?

A Cost Plus Fixed Fee (CPFF) contract is used when the costs are uncertain but can be reasonably estimated. The contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. While the fee is fixed, incentivizing the contractor to control costs to maximize profit, there's a risk that the government may end up paying more than anticipated if the estimated costs are inaccurate or if scope creep occurs. Rigorous oversight is crucial to manage the 'cost' portion effectively and ensure the 'fixed fee' remains a fair profit.

What are the implications of a sole-source award for the defense industrial base?

Sole-source awards in the defense industrial base often reflect the highly specialized and consolidated nature of certain defense markets. While they ensure critical capabilities are maintained with trusted providers, they can stifle innovation and competition. This can lead to higher prices and reduced agility in the supply chain. For the broader industrial base, it means fewer opportunities for diversification and potentially less investment in new technologies by emerging players who cannot break into established sole-source relationships.

What is the historical spending trend for similar 'Guided Missile Components' or engineering services within the Department of Defense?

Historical spending on guided missile components and related engineering services within the Department of Defense is substantial and generally trends upwards, driven by modernization programs and geopolitical factors. While specific data for this exact contract's components isn't available, the overall budget for strategic systems and missile defense consistently represents a significant portion of the DoD's procurement and R&D spending. Analyzing broader trends for programs like the Trident II missile would show multi-billion dollar investments over decades, with fluctuations based on program phases and strategic priorities.

What is the track record of General Dynamics Defense Systems in delivering complex defense systems?

General Dynamics, and its various subsidiaries like General Dynamics Defense Systems (now part of General Dynamics Mission Systems), has a long and extensive track record in delivering complex defense systems for the U.S. military and allies. They are a major prime contractor for numerous critical programs, including submarines, armored vehicles, and advanced electronics and communications systems. Their involvement in programs like the Trident II missile indicates a proven capability in handling highly sensitive and technologically demanding projects, suggesting a reliable, albeit potentially high-cost, partner for the government.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 100 PLASTICS AVE, PITTSFIELD, MA, 01201

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline