DoD's Navy awards $15.8M for electro-optic sights, with limited competition

Contract Overview

Contract Amount: $15,785,152 ($15.8M)

Contractor: Msi-Defence Systems US, LLC

Awarding Agency: Department of Defense

Start Date: 2023-09-29

End Date: 2026-09-28

Contract Duration: 1,095 days

Daily Burn Rate: $14.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MSI-DS ELECTRO-OPTIC SIGHT (EOS)

Place of Performance

Location: ROCK HILL, YORK County, SOUTH CAROLINA, 29730

State: South Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $15.8 million to MSI-DEFENCE SYSTEMS US, LLC for work described as: MSI-DS ELECTRO-OPTIC SIGHT (EOS) Key points: 1. The contract value represents a significant investment in advanced targeting and observation systems for naval operations. 2. Limited competition raises questions about potential price inflation and the optimal use of taxpayer funds. 3. The fixed-price contract type shifts some performance risk to the contractor, but oversight is crucial. 4. This award falls within the broader defense sector's ongoing modernization efforts for sensor technology. 5. The duration of the contract suggests a sustained need for these critical electro-optic systems.

Value Assessment

Rating: fair

The contract value of $15.8 million for electro-optic sights appears substantial. Benchmarking against similar contracts for advanced optical systems is challenging without more detailed specifications. However, the limited competition suggests that the government may not have achieved the most competitive pricing possible, potentially leading to a fair-to-questionable value proposition. Further analysis of the unit costs and comparison to off-the-shelf or similarly competed systems would be needed for a definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under a 'not available for competition' basis, indicating limited or no open competition. This suggests that only one or a very small number of sources were considered capable of meeting the specific requirements. While this can be necessary for highly specialized or proprietary systems, it significantly reduces the opportunity for robust price discovery and may result in higher costs for the government compared to a fully competed procurement.

Taxpayer Impact: Limited competition means taxpayers may be paying a premium for these electro-optic sights, as the lack of multiple bidders reduces the incentive for contractors to offer their lowest possible prices.

Public Impact

Naval forces will benefit from enhanced situational awareness and targeting capabilities provided by these advanced electro-optic sights. The services delivered include the provision of critical hardware for modern naval platforms. The geographic impact is likely concentrated around naval bases and operational areas where these systems will be deployed. This contract supports specialized manufacturing jobs within the defense industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may lead to higher costs for taxpayers.
Lack of transparency in the procurement process due to limited competition.
Potential for contractor lock-in if alternative solutions are not explored.

Positive Signals

Awarding a fixed-price contract helps control costs if contractor performance is managed effectively.
The contract supports the modernization of critical defense capabilities.
The contractor is a known entity in the defense systems market.

Sector Analysis

The defense sector is characterized by high-value, technologically advanced procurements. Electro-optic systems are a critical component of modern military hardware, enabling enhanced surveillance, targeting, and navigation. The market for these systems is often specialized, with a few key players dominating. Spending in this sub-sector is driven by ongoing military modernization programs and the need for superior sensor technology to maintain a strategic advantage. Comparable spending benchmarks would typically involve other advanced sensor or targeting system awards within the Department of Defense.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). There is no information provided regarding subcontracting plans. Therefore, the direct impact on the small business ecosystem is likely minimal, and opportunities for small business participation would depend on MSI-Defence Systems US, LLC's subcontracting strategy.

Oversight & Accountability

Oversight for this contract will primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the fixed-price contract type, which incentivizes contractor performance. Transparency may be limited due to the non-competitive award. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Electro-Optical Systems
Naval Sensor Technology Procurement
Defense Targeting Systems
Military Optics and Imaging

Risk Flags

Limited competition procurement
Potential for price inflation due to lack of competition
Lack of detailed technical specifications in public award data

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.8 million to MSI-DEFENCE SYSTEMS US, LLC. MSI-DS ELECTRO-OPTIC SIGHT (EOS)

Who is the contractor on this award?

The obligated recipient is MSI-DEFENCE SYSTEMS US, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $15.8 million.

What is the period of performance?

Start: 2023-09-29. End: 2026-09-28.

What is the specific capability and intended use of the MSI-DS ELECTRO-OPTIC SIGHT (EOS) being procured?

The MSI-DS ELECTRO-OPTIC SIGHT (EOS) is a sophisticated system designed for advanced naval applications. While the specific model and detailed technical specifications are not provided in the data, electro-optic sights generally integrate various optical and electronic technologies to provide enhanced situational awareness, target acquisition, and fire control capabilities. For naval platforms, these systems are crucial for detecting and tracking surface and air threats, navigating in challenging conditions, and supporting offensive and defensive operations. The 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' NAICS code further suggests a broad application within these critical maritime functions.

How does the $15.8 million contract value compare to historical spending on similar electro-optic systems by the Department of the Navy?

Direct historical spending comparisons for this specific 'MSI-DS ELECTRO-OPTIC SIGHT (EOS)' are not available from the provided data. However, the $15.8 million award for a 3-year period (2023-2026) suggests a significant investment. The Department of the Navy frequently procures advanced sensor and targeting systems, with contract values often ranging from several million to hundreds of millions of dollars, depending on the system's complexity, quantity, and integration requirements. Without knowing the exact capabilities and quantities of these particular EOS units, a precise historical benchmark is difficult. However, given the limited competition, it is plausible that this value is at the higher end for systems of comparable, albeit unspecified, technological sophistication.

What are the primary risks associated with awarding this contract on a 'not available for competition' basis?

The primary risk of awarding a contract on a 'not available for competition' basis is the potential for inflated pricing. Without the pressure of multiple bidders vying for the contract, the sole or limited source contractor may not feel compelled to offer the most competitive price. This can lead to the government paying more than necessary for the goods or services. Additionally, limited competition can reduce transparency in the procurement process and may signal a lack of available market alternatives or a reliance on a single supplier, potentially creating future dependency risks. It also limits opportunities for innovation that might arise from a broader competitive field.

What is the expected impact of these electro-optic sights on the operational effectiveness of the Department of the Navy?

The procurement of advanced electro-optic sights is expected to significantly enhance the operational effectiveness of the Department of the Navy. These systems typically provide superior visual acuity, thermal imaging, and potentially laser rangefinding capabilities, allowing naval personnel to detect, identify, and track targets with greater accuracy and at longer ranges, even in adverse weather or low-light conditions. This improved situational awareness is critical for navigation, threat assessment, and effective engagement. For naval platforms, this translates to enhanced survivability, mission success rates, and overall force projection capabilities in diverse operational environments.

What is the track record of MSI-Defence Systems US, LLC in delivering similar electro-optic systems to the U.S. government?

The provided data indicates that MSI-Defence Systems US, LLC is the contractor for this award. However, it does not offer specific details about their past performance, track record, or previous contract history with the U.S. government, particularly concerning electro-optic systems. To assess their track record, one would typically need to consult contract databases (like FPDS or SAM.gov) for past awards, performance evaluations (e.g., CPARS reports), and any history of contract disputes or successes. Without this additional information, it is difficult to definitively evaluate their reliability and past performance in delivering similar complex systems.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0016423RJQ13

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1298 GALLERIA BOULEVARD, ROCK HILL, SC, 29730

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Manufacturer of Goods, Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $15,785,152

Exercised Options: $15,785,152

Current Obligation: $15,785,152

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0016423DJQ13

IDV Type: IDC

Timeline