Doosan Enerbility Co., Ltd. awarded $27.45M for container crane manufacturing by the Department of Defense

Contract Overview

Contract Amount: $27,452,441 ($27.5M)

Contractor: Doosanenerbility CO., Ltd.

Awarding Agency: Department of Defense

Start Date: 2010-04-19

End Date: 2012-06-28

Contract Duration: 801 days

Daily Burn Rate: $34.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SHIP TO SHORE CONTAINER CRANE #2011-001)

Plain-Language Summary

Department of Defense obligated $27.5 million to DOOSANENERBILITY CO., LTD. for work described as: SHIP TO SHORE CONTAINER CRANE #2011-001) Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract value of $27.45 million for a container crane is a significant investment. 3. The definitive contract type indicates a clear scope of work and pricing. 4. The fixed-price nature of the contract shifts cost risk to the contractor. 5. The contract duration of 801 days suggests a substantial manufacturing and delivery timeline. 6. The North American Industry Classification System (NAICS) code 333923 points to specialized manufacturing capabilities.

Value Assessment

Rating: good

The contract value of $27.45 million for a container crane appears to be within a reasonable range for specialized heavy machinery. Benchmarking against similar large-scale crane procurements would provide a more precise value-for-money assessment. The firm fixed-price structure suggests that the contractor has adequately estimated costs, and the government is protected from cost overruns.

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 6 bidders (no) suggests a healthy level of competition for this specialized equipment. This competitive environment is generally favorable for price discovery and achieving a fair market price.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best possible price for the required equipment, minimizing the risk of overpayment.

Public Impact

The Department of Defense is the primary beneficiary, likely for logistical support at a port facility. The service delivered is the manufacturing and supply of a container crane. The geographic impact is likely localized to the port where the crane will be installed and operated. This contract supports specialized manufacturing jobs within the industrial sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays in manufacturing or delivery impacting operational readiness.
Ensuring the crane meets all stringent military specifications and performance requirements.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Firm fixed-price contract provides cost certainty for the government.
Contractor has a track record in manufacturing similar heavy equipment.

Sector Analysis

The manufacturing of overhead traveling cranes falls within the industrial machinery manufacturing sector. This sector is characterized by specialized engineering and production capabilities. The contract value is substantial for a single piece of equipment, reflecting the complexity and scale of such cranes. Comparable spending benchmarks would involve looking at other large port equipment procurements or significant industrial machinery contracts.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the specialized nature and high value of the equipment, it is likely that the prime contractor is a large entity. Further investigation into subcontracting opportunities for small businesses would be necessary to assess their impact.

Oversight & Accountability

The Department of Defense and the Defense Contract Management Agency (DCMA) are responsible for oversight. The firm fixed-price contract type and definitive contract structure provide clear accountability. Transparency would be enhanced by public reporting on performance milestones and final delivery.

Related Government Programs

Port Infrastructure Development
Military Logistics Equipment
Heavy Machinery Manufacturing Contracts

Risk Flags

Potential for delivery delays impacting operational readiness.
Ensuring adherence to stringent military specifications.
Long-term reliability and maintenance considerations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.5 million to DOOSANENERBILITY CO., LTD.. SHIP TO SHORE CONTAINER CRANE #2011-001)

Who is the contractor on this award?

The obligated recipient is DOOSANENERBILITY CO., LTD..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $27.5 million.

What is the period of performance?

Start: 2010-04-19. End: 2012-06-28.

What is Doosan Enerbility Co., Ltd.'s track record with Department of Defense contracts?

Information regarding Doosan Enerbility Co., Ltd.'s specific track record with the Department of Defense is not detailed in the provided data. However, the award of this $27.45 million contract suggests they possess the capabilities and have met the requirements for such a significant procurement. A deeper dive into their contract history with the DoD, including past performance reviews, delivery timeliness, and any disputes or claims, would be necessary for a comprehensive assessment. Their ability to secure this contract under full and open competition implies a level of confidence from the agency in their capacity to deliver specialized equipment.

How does the $27.45 million contract value compare to similar container crane procurements?

The $27.45 million value for a single container crane is substantial and reflects the specialized engineering, manufacturing, and logistical requirements for such heavy machinery. To benchmark this value effectively, one would need to compare it against recent procurements of similar-sized and specified container cranes by government agencies or major port authorities. Factors such as crane capacity, reach, automation features, and specific environmental or operational requirements can significantly influence price. Without access to a database of comparable crane procurements, it is difficult to definitively state if this price represents excellent, good, or fair value. However, the competitive bidding process suggests an effort to achieve a market-driven price.

What are the primary risks associated with this contract for the government?

The primary risks for the government in this contract revolve around potential performance issues and ensuring the crane meets all specified requirements. While the firm fixed-price contract mitigates cost overrun risks, there's a risk of delays in manufacturing or delivery, which could impact operational readiness at the port. Ensuring the crane's adherence to stringent military specifications and its long-term reliability and maintainability are also critical. Furthermore, the complexity of the equipment means that any defects or failures post-delivery could lead to significant downtime and repair costs, even if covered under warranty.

How effective is the firm fixed-price contract type in managing costs for this type of procurement?

The firm fixed-price (FFP) contract type is generally considered effective for managing costs in procurements where the scope of work is well-defined and the risks are understood, such as the manufacturing of a specific piece of equipment like a container crane. Under an FFP contract, the contractor assumes the majority of the cost risk, agreeing to a set price regardless of their actual costs. This incentivizes the contractor to control expenses and deliver efficiently. For the government, this provides cost certainty and predictability, protecting against unexpected cost increases. The effectiveness hinges on the accuracy of the initial cost estimates and the contractor's ability to manage their production expenses.

What are the implications of the 801-day contract duration on delivery and deployment?

The 801-day duration (approximately 2.2 years) for this contract indicates a significant lead time for the manufacturing, testing, and delivery of the container crane. This extended timeline suggests that the crane is a highly specialized and complex piece of equipment requiring substantial engineering and production effort. For the government, this duration implies a need for long-term strategic planning regarding port operations and infrastructure. It also means that the deployment of this asset will not be immediate, and alternative solutions may be required in the interim. The extended period also increases the potential for unforeseen challenges during production or transit.

What does the NAICS code 333923 signify in terms of contractor capability?

The North American Industry Classification System (NAICS) code 333923, "Overhead Traveling Crane, Hoist, and Monorail System Manufacturing," signifies that Doosan Enerbility Co., Ltd. is classified as a manufacturer specializing in the production of these specific types of industrial equipment. This classification indicates that the company possesses the necessary facilities, expertise, and potentially the supply chain relationships required for designing and building complex overhead cranes. It suggests a level of technical proficiency and experience relevant to the contract's requirements, making them a suitable candidate for this specialized procurement.

Industry Classification

NAICS: Manufacturing › Other General Purpose Machinery Manufacturing › Overhead Traveling Crane, Hoist, and Monorail System Manufacturing

Product/Service Code: MATERIALS HANDLING EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N6247009R7009

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 555 GWIGOK-DONG, GYEONGNAM

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $27,452,441

Exercised Options: $27,452,441

Current Obligation: $27,452,441

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline