DoD's $14.5M engineering support contract for DDG-51 modernization awarded to TDI Technologies, Inc

Contract Overview

Contract Amount: $14,478,926 ($14.5M)

Contractor: TDI Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-04-09

End Date: 2026-04-11

Contract Duration: 1,828 days

Daily Burn Rate: $7.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING SUPPORT FOR DDG-51 FLTI, FLTII, FLTIIA, HED (HYBRID ELECTRIC DRIVE) MODERNIZATION AND OBSOLESCENCE MACHINERY CONTROL SYSTEMS

Place of Performance

Location: KING OF PRUSSIA, MONTGOMERY County, PENNSYLVANIA, 19406

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $14.5 million to TDI TECHNOLOGIES, INC. for work described as: ENGINEERING SUPPORT FOR DDG-51 FLTI, FLTII, FLTIIA, HED (HYBRID ELECTRIC DRIVE) MODERNIZATION AND OBSOLESCENCE MACHINERY CONTROL SYSTEMS Key points: 1. Contract focuses on critical modernization and obsolescence management for DDG-51 class ships. 2. The award to TDI Technologies, Inc. represents a significant investment in naval fleet readiness. 3. Engineering services are essential for maintaining the operational effectiveness of aging naval assets. 4. The contract duration of 1828 days indicates a long-term commitment to system sustainment. 5. The 'PA' (Pennsylvania) state designation suggests a concentration of engineering expertise in that region. 6. The contract type (Cost Plus Fixed Fee) allows for flexibility in addressing unforeseen technical challenges.

Value Assessment

Rating: good

The contract value of $14.5 million for engineering support over approximately five years appears reasonable given the complexity of modernizing naval vessels. Benchmarking against similar engineering services contracts for fleet modernization is challenging without more specific scope details, but the duration and nature of the work suggest a fair price point. The fixed fee component provides some cost control for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of 4 bids (implied by 'no': 4) suggests a competitive environment, which typically drives better pricing and innovation. The government's ability to select from a range of proposals likely resulted in a more favorable outcome than a sole-source award.

Taxpayer Impact: Full and open competition ensures that taxpayer dollars are used efficiently by fostering a market-driven price discovery process and encouraging contractors to offer their best value.

Public Impact

Naval fleet readiness and modernization are directly enhanced, ensuring the U.S. Navy can maintain its operational capabilities. Warship modernization supports national security objectives by keeping critical defense assets up-to-date. The contract supports specialized engineering jobs, likely within the aerospace and defense sector, potentially in Pennsylvania. Improved machinery control systems contribute to the safety and reliability of naval operations at sea.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can sometimes lead to cost overruns if not managed diligently.
Reliance on a single contractor for critical engineering support could pose a risk if performance issues arise.
Obsolescence management is a complex and ongoing challenge that requires continuous adaptation.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
The contract addresses critical modernization needs for a key naval asset (DDG-51 class).
Long contract duration suggests a stable and reliable engineering partnership.
Focus on hybrid electric drive modernization points to forward-looking technological integration.

Sector Analysis

This contract falls within the broader engineering services sector, specifically supporting the defense industry's need for naval modernization. The market for defense engineering services is substantial, driven by the continuous need to upgrade and maintain complex military platforms. Comparable spending benchmarks would involve other contracts for ship design, modernization, and systems engineering for naval vessels, which often represent significant investments due to the intricate nature of maritime technology.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses ('sb': false). While TDI Technologies, Inc. may be a small business, the award mechanism itself did not prioritize small business participation. There is no explicit information on subcontracting plans for small businesses, which could represent missed opportunities for smaller firms to contribute to this significant defense project.

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 Cost Plus Fixed Fee structure, requiring detailed reporting and justification of costs. Transparency is generally maintained through contract databases and reporting requirements, though specific oversight reports or Inspector General investigations related to this particular contract are not detailed here.

Related Government Programs

DDG-51 Class Destroyer Modernization Programs
Naval Ship Systems Engineering Support
Machinery Control Systems Modernization
Hybrid Electric Drive Technology Integration
Defense Engineering Services Contracts

Risk Flags

Potential for cost overruns with CPFF contract type.
Complexity of obsolescence management in aging naval systems.
Dependence on contractor performance for critical modernization tasks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.5 million to TDI TECHNOLOGIES, INC.. ENGINEERING SUPPORT FOR DDG-51 FLTI, FLTII, FLTIIA, HED (HYBRID ELECTRIC DRIVE) MODERNIZATION AND OBSOLESCENCE MACHINERY CONTROL SYSTEMS

Who is the contractor on this award?

The obligated recipient is TDI TECHNOLOGIES, 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 $14.5 million.

What is the period of performance?

Start: 2021-04-09. End: 2026-04-11.

What is the track record of TDI Technologies, Inc. in performing similar engineering support contracts for the Department of Defense?

Assessing TDI Technologies, Inc.'s track record requires a review of their past performance on similar contracts. This would involve examining contract databases for awards to TDI Technologies, Inc. related to naval modernization, systems engineering, or machinery control systems. Key indicators would include on-time delivery, adherence to budget, quality of work, and any past performance reviews or disputes. Without specific historical data on TDI's performance on comparable projects, it is difficult to definitively assess their capability for this specific DDG-51 modernization effort. However, the award through full and open competition suggests they met the minimum qualifications and were deemed a viable option among multiple bidders.

How does the value of this contract compare to other engineering support contracts for naval modernization?

The $14.5 million contract value for engineering support over approximately five years for DDG-51 modernization is within a typical range for complex naval engineering projects. Larger modernization programs for entire ship classes can run into hundreds of millions or even billions of dollars. However, this specific contract focuses on engineering support for modernization and obsolescence, which is a critical but often a component of larger upgrade efforts. Benchmarking requires comparing the scope of work, duration, and specific technical requirements (like hybrid electric drive integration) against similar contracts. Contracts for specialized systems engineering or sustainment for major naval platforms often represent significant investments, making this value appear reasonable in context.

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

Primary risks include technical challenges in modernizing aging systems, potential cost overruns inherent in Cost Plus Fixed Fee (CPFF) contracts, and the risk of contractor underperformance. Obsolescence management itself is a complex, ongoing challenge. Mitigation strategies likely include rigorous technical reviews, phased implementation of upgrades, strong government oversight of contractor expenditures and progress, and performance metrics tied to the contract. The CPFF structure allows for flexibility to address unforeseen technical issues, but requires diligent government monitoring to ensure cost-effectiveness. The full and open competition award process also mitigates the risk of selecting an unqualified vendor.

How effective is the Cost Plus Fixed Fee (CPFF) contract type for managing modernization and obsolescence engineering services?

The CPFF contract type is often used when the scope of work cannot be precisely defined at the outset, which is common in complex modernization and obsolescence projects. It provides flexibility for the contractor to adapt to unforeseen technical challenges and evolving requirements. The government pays the actual allowable costs plus a fixed fee representing profit. This structure incentivizes the contractor to control costs to maximize their fixed profit margin. However, it requires robust government oversight to prevent cost escalation and ensure that costs are reasonable and allocable to the contract. For modernization efforts where technical unknowns are high, CPFF can be effective if managed diligently.

What is the historical spending trend for engineering support related to the DDG-51 class modernization?

Analyzing historical spending trends for DDG-51 class modernization requires examining past contracts awarded for similar engineering support, upgrades, and maintenance over the lifespan of the DDG-51 program. This specific contract, valued at $14.5 million over approximately five years, represents a portion of the overall modernization budget. Historical data would likely show fluctuating spending based on modernization phases, technological advancements, and the Navy's strategic priorities. Significant investments are typically made during major refits or upgrade cycles. Understanding past spending patterns helps in forecasting future needs and assessing the current contract's alignment with long-term fleet sustainment strategies.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6449820R3042

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 939 RADNOR RD, WAYNE, PA, 19087

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $16,153,480

Exercised Options: $16,153,480

Current Obligation: $14,478,926

Actual Outlays: $48,736

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017819D8650

IDV Type: IDC

Timeline