DoD awards $102.6M contract for high-precision CNC grinders to HARTECH GROUP LLC

Contract Overview

Contract Amount: $10,262,802 ($10.3M)

Contractor: Hartech Group LLC

Awarding Agency: Department of Defense

Start Date: 2025-12-29

End Date: 2027-04-09

Contract Duration: 466 days

Daily Burn Rate: $22.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 8511793473!GRINDER, JIG, CNC HIGH PRECIS

Place of Performance

Location: NEW PORT RICHEY, PASCO County, FLORIDA, 34652

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $10.3 million to HARTECH GROUP LLC for work described as: 8511793473!GRINDER, JIG, CNC HIGH PRECIS Key points: 1. Contract awarded on a sole-source basis, raising questions about potential price overruns. 2. Limited competition may have resulted in a higher price than if multiple vendors were involved. 3. The contract duration of 466 days suggests a significant need for these specialized machines. 4. The firm fixed-price structure shifts cost risk to the contractor, which is generally favorable. 5. The Machine Tool Manufacturing sector is critical for defense readiness and industrial capacity. 6. The award to a single vendor warrants scrutiny regarding market availability and alternative solutions.

Value Assessment

Rating: questionable

The contract value of $102.6 million for CNC grinders appears substantial. Without specific benchmarks for comparable high-precision CNC grinders, it is difficult to definitively assess value for money. However, the sole-source nature of the award raises concerns that the price may not reflect competitive market dynamics. Further analysis would require benchmarking against similar procurements or industry price lists for comparable equipment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, HARTECH GROUP LLC, was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple interested parties submitting proposals. The lack of competition limits the government's ability to leverage market forces to secure the best possible price and terms.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no direct price pressure from competing offers. This can result in less efficient use of public funds compared to competitively awarded contracts.

Public Impact

The primary beneficiaries are the Department of Defense, which will receive critical manufacturing equipment. The contract supports the production of high-precision CNC grinders essential for defense manufacturing capabilities. The geographic impact is primarily in Florida (ST), where the contractor is located, and potentially at DoD facilities receiving the equipment. The contract may have implications for the skilled manufacturing workforce involved in producing and maintaining such advanced machinery.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Lack of competition raises concerns about whether the government obtained the best value.
Absence of small business subcontracting noted, which could be an area for future consideration.

Positive Signals

Firm fixed-price contract structure effectively transfers cost overrun risk to the contractor.
The contract is for specialized, high-precision equipment crucial for defense industrial base.
The contractor, HARTECH GROUP LLC, is receiving a significant award, indicating potential capability.

Sector Analysis

The Machine Tool Manufacturing sector is a foundational element of the defense industrial base, providing the equipment necessary for producing a wide range of military hardware. This sector is characterized by high capital investment, advanced technology, and specialized expertise. The market size for industrial machinery is substantial, with significant government procurement activity driven by modernization and readiness requirements. This contract for high-precision CNC grinders fits within this critical segment, supporting advanced manufacturing capabilities.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business) flag is also false. This suggests that the primary award was not specifically targeted towards small businesses, nor does it appear to have a direct subcontracting plan requirement for small businesses explicitly stated in the provided data. The impact on the small business ecosystem is therefore likely indirect, through potential supply chain opportunities or competition with larger firms.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations. The Defense Contract Management Agency (DCMA) often provides contract administration and oversight. Given it's a definitive contract, standard oversight mechanisms for contract performance, quality assurance, and payment would apply. Transparency is generally maintained through contract databases like FPDS, though the specifics of sole-source justifications may have varying levels of public disclosure.

Related Government Programs

Defense Logistics Agency Procurement
Machine Tool Manufacturing Equipment
Department of Defense Capital Equipment Procurement
Sole-Source Defense Contracts

Risk Flags

Sole-source award
Potential for price inflation
Lack of competitive benchmarking
Limited transparency on justification for sole-source

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.3 million to HARTECH GROUP LLC. 8511793473!GRINDER, JIG, CNC HIGH PRECIS

Who is the contractor on this award?

The obligated recipient is HARTECH GROUP LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $10.3 million.

What is the period of performance?

Start: 2025-12-29. End: 2027-04-09.

What is the track record of HARTECH GROUP LLC in fulfilling defense contracts, particularly for complex machinery?

Information regarding HARTECH GROUP LLC's specific track record with defense contracts, especially for complex machinery like high-precision CNC grinders, is not detailed in the provided data snippet. A comprehensive assessment would require reviewing their past performance evaluations, contract history, and any reported issues or successes on similar government procurements. Without this historical data, it's challenging to gauge their reliability and capability beyond the current award. Further investigation into their contract performance history within the Federal Procurement Data System (FPDS) or through agency performance reports would be necessary.

How does the awarded price of $102.6 million compare to market rates for similar high-precision CNC grinders?

The provided data does not include specific per-unit costs or detailed specifications of the CNC grinders being procured, making a direct price comparison to market rates difficult. The total award of $102.6 million is for an unspecified quantity of machines over a 466-day period. To benchmark this value, one would need to identify comparable high-precision CNC grinder models, their typical market prices (both commercial and government), and the quantity being purchased. Given the sole-source nature of this award, there is a heightened risk that the price may be higher than what could be achieved through a competitive process. Benchmarking would ideally involve obtaining quotes from multiple manufacturers for similar specifications.

What are the specific risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risk associated with a sole-source award of this magnitude ($102.6 million) is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government has less leverage to negotiate the best possible price. Other risks include a potential lack of innovation if the sole provider is not incentivized to offer cutting-edge solutions, and a dependency on a single supplier, which could create vulnerabilities in the supply chain. Furthermore, it raises questions about whether adequate market research was conducted to ensure no other capable sources existed or could be developed.

What is the expected impact of these CNC grinders on the Department of Defense's manufacturing capabilities?

The procurement of high-precision CNC grinders is expected to significantly enhance the Department of Defense's manufacturing capabilities by enabling the production of more complex, precise, and high-quality components. These machines are critical for advanced manufacturing processes, allowing for tighter tolerances and improved material utilization. This can lead to more reliable and higher-performing military equipment, reduced waste, and potentially faster production cycles for essential parts. The investment signifies a commitment to modernizing and strengthening the defense industrial base's capacity for producing sophisticated weaponry and systems.

What has been the historical spending pattern for similar machine tool procurements by the Defense Logistics Agency or DoD?

The provided data snippet does not contain historical spending patterns for similar machine tool procurements by the Defense Logistics Agency (DLA) or the broader Department of Defense (DoD). To analyze historical spending, one would need to query procurement databases (like FPDS) for contracts related to 'Machine Tool Manufacturing' (ND code 333517) or specific types of machinery over several fiscal years. This would reveal trends in contract values, award types (competed vs. sole-source), and the number of contractors involved, providing context for the current $102.6 million award.

Are there any specific performance metrics or deliverables outlined in the contract that can be used to assess program effectiveness?

The provided data snippet does not detail specific performance metrics, deliverables, or quality assurance standards for this contract. While it indicates a 'FIRM FIXED PRICE' (pt) contract type and a duration (dur) of 466 days, the specifics of what constitutes successful performance are not included. Assessing program effectiveness would require access to the full contract document, which would outline requirements for delivery schedules, technical specifications, quality control procedures, and acceptance criteria. Without these details, effectiveness can only be broadly inferred from the criticality of the equipment being procured.

Industry Classification

NAICS: Manufacturing › Metalworking Machinery Manufacturing › Machine Tool Manufacturing

Product/Service Code: METALWORKING MACHINERY

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5516 LEEWARD LN, NEW PORT RICHEY, FL, 34652

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $10,262,802

Exercised Options: $10,262,802

Current Obligation: $10,262,802

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline