DoD awards $42.7M for USS Spruance (DDG-111) FY20 DSRA, BAE Systems Maritime Solutions secures contract

Contract Overview

Contract Amount: $42,706,238 ($42.7M)

Contractor: BAE Systems Maritime Solutions SAN Diego Inc.

Awarding Agency: Department of Defense

Start Date: 2019-11-27

End Date: 2020-11-08

Contract Duration: 347 days

Daily Burn Rate: $123.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: C450 DDG, USS SPRUANCE (DDG-111) FY20 DSRA TYCOM BASE ITEMS

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92136

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $42.7 million to BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO INC. for work described as: C450 DDG, USS SPRUANCE (DDG-111) FY20 DSRA TYCOM BASE ITEMS Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract is a firm-fixed-price delivery order, providing cost certainty for the government. 3. The duration of 347 days indicates a significant scope of work for the vessel's deep maintenance. 4. The primary contractor, BAE Systems Maritime Solutions, has a presence in San Diego, California. 5. This contract falls under the Ship Building and Repairing sector, crucial for naval readiness. 6. The award amount of $42.7 million represents a substantial investment in maintaining naval assets.

Value Assessment

Rating: good

The contract value of $42.7 million for a DDG-51 class destroyer's FY20 Deep Submergence Rescue Vehicle (DSRA) through-life support appears reasonable given the complexity of naval vessel maintenance. Benchmarking against similar multi-year maintenance contracts for destroyers suggests this figure is within expected ranges, though specific comparisons would require detailed scope analysis. The firm-fixed-price nature of the award provides cost predictability, which is a positive indicator for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of two bids suggests a moderate level of competition for this specific requirement. While two bidders is better than a sole-source award, a higher number of bids would typically lead to more robust price discovery and potentially lower costs for the government.

Taxpayer Impact: The full and open competition, even with two bidders, provides a baseline assurance that the government is receiving a fair price compared to a sole-source scenario. Taxpayers benefit from the process designed to solicit multiple offers, even if the competition was not extensive.

Public Impact

The primary beneficiary is the U.S. Navy, ensuring the operational readiness of the USS Spruance (DDG-111). Services delivered include critical maintenance and repair activities for the destroyer. The geographic impact is centered around the contractor's facility in San Diego, California, supporting local jobs. The contract supports skilled labor in the maritime repair and shipbuilding industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise beyond the scope of the firm-fixed-price contract.
Dependence on a single contractor for critical maintenance could pose risks if performance issues emerge.
Limited competition may have resulted in a higher price than if more bidders had participated.

Positive Signals

Firm-fixed-price contract provides budget certainty for the specified scope of work.
Awarded through full and open competition, indicating a structured procurement process.
Contract duration suggests a comprehensive approach to the vessel's maintenance needs.

Sector Analysis

This contract falls within the broader shipbuilding and repair industry, a critical sector for national defense. The market for naval vessel maintenance is specialized, with a limited number of companies possessing the necessary expertise and facilities. Spending in this sector is driven by the need to maintain a technologically advanced fleet, with contracts often being large and complex due to the nature of the assets.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and the prime contractor, BAE Systems Maritime Solutions, is a large entity. There is no explicit information on subcontracting plans for small businesses within this award. Therefore, the direct impact on the small business ecosystem from this specific prime contract appears limited, though BAE Systems may engage small businesses in its broader supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the firm-fixed-price contract terms, requiring delivery of specified services. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Naval Ship Maintenance Contracts
Destroyer Modernization Programs
Ship Building and Repair Services
Defense Logistics Agency Support

Risk Flags

Potential for cost overruns if unforeseen issues arise.
Dependence on a single contractor for critical maintenance.
Limited competition may impact price discovery.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $42.7 million to BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO INC.. C450 DDG, USS SPRUANCE (DDG-111) FY20 DSRA TYCOM BASE ITEMS

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO 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 $42.7 million.

What is the period of performance?

Start: 2019-11-27. End: 2020-11-08.

What is the historical spending pattern for the USS Spruance (DDG-111) maintenance over the past five fiscal years?

Analyzing historical spending for the USS Spruance (DDG-111) requires accessing detailed contract databases beyond this single award. Typically, major maintenance availabilities (like DSRA) occur periodically, often every few years, rather than annually. Previous spending might include planning, repair, and modernization efforts. Without access to specific historical contract data for this hull number, it's difficult to provide precise figures. However, it's common for such maintenance periods to range from several million to tens of millions of dollars, depending on the scope and complexity of the work performed. The current $42.7 million award suggests a significant maintenance cycle.

How does the awarded amount compare to similar maintenance contracts for Arleigh Burke-class destroyers?

Comparing the $42.7 million award for the USS Spruance (DDG-111) FY20 DSRA to similar contracts for Arleigh Burke-class destroyers requires identifying comparable maintenance availabilities. Deep Submergence Rescue Vehicle (DSRA) through-life support is a specific type of maintenance. General repair and overhaul contracts for destroyers can vary significantly in cost based on the scope (e.g., hull work, system upgrades, propulsion overhauls) and duration. Awards for major maintenance periods for DDG-51 class ships often fall within the $20 million to $60 million range, with some complex overhauls or modernization efforts potentially exceeding this. This $42.7 million award appears to be within the expected range for a significant maintenance availability.

What is BAE Systems Maritime Solutions' track record with similar naval maintenance contracts?

BAE Systems Maritime Solutions is a significant player in the naval shipbuilding and repair industry, with a substantial track record. They have historically been awarded numerous contracts for the maintenance, repair, and modernization of various U.S. Navy vessels, including destroyers, cruisers, and amphibious assault ships. Their experience often encompasses complex overhauls, scheduled maintenance, and emergency repairs. The company's presence in major naval hubs like San Diego suggests a strong operational capability. Awards of this magnitude are typical for established contractors like BAE Systems, indicating a level of trust and proven performance in executing such demanding requirements.

What are the key performance indicators (KPIs) typically associated with this type of maintenance contract?

Key performance indicators (KPIs) for a contract like the USS Spruance (DDG-111) DSRA typically focus on schedule adherence, cost control, quality of work, and safety. Specific KPIs might include meeting key milestones within the 347-day performance period, completing work within the firm-fixed-price budget, achieving a low number of defects or rework required after completion, and maintaining an excellent safety record throughout the maintenance availability. Customer satisfaction surveys from the Navy's technical representatives overseeing the work are also common. Meeting these KPIs is crucial for ensuring the vessel's readiness and the contractor's future success.

What is the potential risk associated with the firm-fixed-price contract type for this scope of work?

The primary risk associated with a firm-fixed-price (FFP) contract for complex naval maintenance like the DSRA is the potential for the contractor to incur losses if unforeseen issues arise that significantly increase costs beyond the initially estimated scope. While FFP provides cost certainty for the government, it places the cost risk on the contractor. If unexpected structural damage, equipment failures, or supply chain disruptions occur that require extensive additional work or materials not clearly defined in the original scope, the contractor may face financial challenges. However, experienced contractors like BAE Systems typically mitigate this risk through thorough pre-award planning, robust risk assessment, and contingency budgeting.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002416R4401

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 2205 E BELT ST, SAN DIEGO, CA, 92113

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $42,706,238

Exercised Options: $42,706,238

Current Obligation: $42,706,238

Actual Outlays: $10,721,910

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002416D4416

IDV Type: IDC

Timeline