Navy awards $360M contract for maritime prepositioning vessel operations and maintenance to Crowley Government Services

Contract Overview

Contract Amount: $360,057,202 ($360.1M)

Contractor: Crowley Government Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-10-01

End Date: 2029-09-30

Contract Duration: 2,556 days

Daily Burn Rate: $140.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: N105A/PM3 HAYCOX CONTRACT AWARD FOR OPERATION & MAINTENANCE OF 6 GOVERNMENT-OWNED MARITIME PREPOSITIONING FORCE VESSELS.

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32225

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $360.1 million to CROWLEY GOVERNMENT SERVICES, INC. for work described as: N105A/PM3 HAYCOX CONTRACT AWARD FOR OPERATION & MAINTENANCE OF 6 GOVERNMENT-OWNED MARITIME PREPOSITIONING FORCE VESSELS. Key points: 1. Contract value of $360M over 5 years suggests significant operational scale and complexity. 2. Full and open competition indicates a robust bidding process, potentially leading to competitive pricing. 3. The contract's duration of 2556 days (approx. 7 years) points to a long-term need for these services. 4. The fixed-price contract type shifts performance risk to the contractor, incentivizing efficient operations. 5. Awarded to a single contractor, Crowley Government Services, highlighting their specialized capabilities in this niche. 6. The North American Industry Classification System (NAICS) code 483111 points to deep-sea freight transportation services.

Value Assessment

Rating: good

The contract value of $360M over approximately 7 years averages to about $51.4M annually. Benchmarking this against similar large-scale maritime logistics contracts is challenging without more specific service details. However, the firm-fixed-price structure suggests that the government has negotiated a price that the contractor must adhere to, implying a degree of value for money if performance is met. The contractor's ability to secure such a large, long-term contract also suggests a competitive bid that reflects market rates for these specialized services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. The presence of 6 bidders (implied by 'no': 6, though this may refer to vessels) suggests a healthy level of competition for this significant contract. A competitive process like this generally leads to better price discovery and ensures that the government receives offers from multiple qualified providers, increasing the likelihood of a favorable outcome.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down prices through market forces, ensuring that the government is not overpaying for essential services like maritime vessel operations.

Public Impact

The primary beneficiaries are the U.S. Navy and the Department of Defense, ensuring the readiness and operational capability of maritime prepositioning forces. Services delivered include the operation and maintenance of six government-owned maritime prepositioning force vessels, crucial for strategic deployment. The contract's geographic impact is likely global, supporting U.S. military operations and power projection worldwide. Workforce implications include employment opportunities for maritime professionals, engineers, technicians, and support staff within Crowley Government Services and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen maintenance issues arise beyond the scope of the fixed-price agreement.
Dependence on a single contractor for critical maritime logistics could pose a risk if performance falters.
Geopolitical instability or global supply chain disruptions could impact operational efficiency and costs.

Positive Signals

Firm-fixed-price contract incentivizes contractor efficiency and cost control.
Long-term nature of the contract provides stability and predictability for both the government and the contractor.
Full and open competition suggests a strong market offering and potentially competitive pricing.

Sector Analysis

The maritime logistics and transportation sector is vital for global trade and national security. This contract falls under deep-sea freight transportation, a segment characterized by high capital investment, stringent regulatory compliance, and specialized operational expertise. The market size for government maritime services is substantial, driven by defense needs, disaster relief, and strategic resource movement. This award to Crowley Government Services positions them as a key player in supporting the U.S. Navy's strategic sealift capabilities.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large-scale, complex operation, it is likely that Crowley Government Services will engage small businesses as subcontractors for specialized services or supplies, contributing to the small business ecosystem. However, the primary awardee is a large corporation, suggesting limited direct contract opportunities for small businesses as prime contractors on this specific award.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy's contracting officers and program managers. Accountability measures are embedded in the firm-fixed-price contract terms, requiring specific performance standards to be met. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Maritime Sealift Command Contracts
Military Sealift Command Operations
Strategic Sealift Capability Contracts
Government Vessel Charter and Operations
Defense Logistics Agency Contracts

Risk Flags

Contract Duration
Single Source Award (for this specific contract)
Reliance on Specialized Fleet

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $360.1 million to CROWLEY GOVERNMENT SERVICES, INC.. N105A/PM3 HAYCOX CONTRACT AWARD FOR OPERATION & MAINTENANCE OF 6 GOVERNMENT-OWNED MARITIME PREPOSITIONING FORCE VESSELS.

Who is the contractor on this award?

The obligated recipient is CROWLEY GOVERNMENT SERVICES, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $360.1 million.

What is the period of performance?

Start: 2022-10-01. End: 2029-09-30.

What is Crowley Government Services' track record with similar large-scale maritime operations contracts for the Department of Defense?

Crowley Government Services has a significant history of performing complex maritime logistics and transportation services for the U.S. military. They have been involved in various aspects of fleet operations, including vessel chartering, crewing, maintenance, and management for different branches of the Department of Defense. Their experience often includes supporting strategic sealift and prepositioning requirements, which are critical for global force projection. This extensive background suggests a strong capability to manage and execute the requirements of this specific contract, having likely navigated similar operational, regulatory, and performance challenges in the past. Their established presence in the government contracting space indicates a familiarity with the stringent requirements and oversight associated with defense contracts.

How does the $360M contract value compare to historical spending on similar maritime prepositioning force vessel operations?

The $360 million contract value over approximately seven years represents a substantial investment in maintaining the operational readiness of six government-owned maritime prepositioning force vessels. To provide a precise comparison, historical spending data for identical or highly similar contracts would be necessary. However, given the scale of operating and maintaining large vessels, including crewing, fuel, maintenance, and logistical support, this figure appears consistent with the high costs associated with sustaining such strategic assets. Fluctuations in annual spending could be influenced by factors such as the intensity of vessel utilization, the specific maintenance cycles required, and broader economic conditions affecting operational costs. Without direct historical benchmarks for these specific vessels or a comparable fleet size and operational tempo, it's difficult to definitively state if this represents an increase or decrease, but it reflects a significant, ongoing commitment.

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

The primary risks associated with this contract include potential operational disruptions due to mechanical failures, unforeseen maintenance needs exceeding the fixed-price scope, and geopolitical factors impacting vessel deployment or safety. Additionally, reliance on a single contractor for critical assets presents a performance risk if the contractor falters. Mitigation strategies are embedded within the contract structure. The firm-fixed-price nature incentivizes Crowley Government Services to manage costs and operations efficiently to maintain profitability. The contract likely includes performance standards, reporting requirements, and potential penalties for non-compliance. The Department of the Navy's oversight, including regular inspections and performance reviews, further mitigates risks by ensuring adherence to contractual obligations and identifying potential issues early.

How effective is the full and open competition process in ensuring value for money for this type of specialized maritime service?

The full and open competition process is generally considered highly effective in ensuring value for money for specialized maritime services like those required for operating and maintaining prepositioning vessels. By allowing all qualified vendors to bid, it fosters a competitive environment where companies must offer their best pricing and technical solutions to win the contract. This process drives down costs through market forces and encourages innovation. The presence of multiple bidders, as indicated by the 'no': 6 metric (potentially referring to vessels or bidders), suggests a robust competition that likely resulted in a price reflecting market realities. While the ultimate value is realized through sustained performance, the initial competitive award is a strong indicator of achieving a fair price for the required services.

What are the implications of this contract award for the broader defense logistics and maritime transportation sector?

This contract award has several implications for the broader defense logistics and maritime transportation sector. Firstly, it reinforces Crowley Government Services' position as a key provider of specialized maritime support to the U.S. military, potentially influencing future contract awards. Secondly, it highlights the ongoing need for robust maritime prepositioning capabilities, signaling continued government investment in this area. Thirdly, the scale of the contract ($360M) indicates the significant market opportunities available within defense logistics, attracting and retaining specialized firms. It also underscores the importance of maintaining a skilled workforce in maritime operations and maintenance, potentially driving training and development initiatives within the sector. Finally, the competitive nature of the award suggests that companies must maintain high standards of performance and cost-efficiency to succeed in this demanding market.

Industry Classification

NAICS: Transportation and Warehousing › Deep Sea, Coastal, and Great Lakes Water Transportation › Deep Sea Freight Transportation

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N3220521R4117

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9487 REGENCY SQUARE BLVD, JACKSONVILLE, FL, 32225

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $569,801,523

Exercised Options: $569,801,523

Current Obligation: $360,057,202

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline