DoD awards $26M for construction machinery, with Mack Defense LLC securing the delivery order

Contract Overview

Contract Amount: $26,029,382 ($26.0M)

Contractor: Mack Defense LLC

Awarding Agency: Department of Defense

Start Date: 2023-04-24

End Date: 2024-12-31

Contract Duration: 617 days

Daily Burn Rate: $42.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 8509850317!VOLVO TRACTOR

Place of Performance

Location: ALLENTOWN, LEHIGH County, PENNSYLVANIA, 18103

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $26.0 million to MACK DEFENSE LLC for work described as: 8509850317!VOLVO TRACTOR Key points: 1. Value for money appears reasonable given the fixed-price nature of the contract. 2. Full and open competition suggests a dynamic marketplace for these goods. 3. The contract duration of over 600 days indicates a significant operational need. 4. Performance context is tied to the Defense Logistics Agency's supply chain operations. 5. Sector positioning is within the heavy equipment manufacturing and defense logistics space.

Value Assessment

Rating: good

The contract's firm fixed-price structure provides cost certainty. Benchmarking against similar procurements for construction machinery by the DoD would offer a clearer picture of value. However, the competitive award process suggests that pricing was likely scrutinized against market rates. The total award amount of $26M over approximately two years indicates a substantial investment in essential equipment.

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 specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to better pricing and innovation. The agency's decision to use full and open competition suggests confidence in the market's ability to meet the requirement effectively.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and a wider selection of qualified vendors, ensuring that the government receives the best possible value for its investment.

Public Impact

The primary beneficiaries are the Department of Defense units requiring construction machinery for various operational and logistical support activities. Services delivered include the provision of construction machinery, likely for base construction, maintenance, and deployment support. Geographic impact is likely nationwide or wherever DoD operations require such equipment, with a specific mention of Pennsylvania as the place of performance. Workforce implications may include support roles for the maintenance and operation of this machinery within the military.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for long-term sustainment costs not fully detailed in the award.
Dependence on a single awardee for a critical need could pose supply chain risks if not managed proactively.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process.
Firm fixed-price contract provides cost predictability for the government.
Delivery order structure allows for phased acquisition and deployment.

Sector Analysis

The defense logistics sector relies heavily on robust supply chains for equipment and machinery. This contract falls within the broader construction machinery manufacturing industry, which is critical for infrastructure development and maintenance, both domestically and in support of military operations. Comparable spending benchmarks for heavy equipment procurement by defense agencies can vary significantly based on specific needs, technological advancements, and geopolitical factors.

Small Business Impact

The data indicates this contract was awarded under full and open competition and does not specify any small business set-aside. Therefore, the direct impact on small businesses through this specific award is likely minimal unless they are part of a larger subcontracting effort. Further analysis would be needed to determine if subcontracting opportunities exist and if small businesses are being utilized.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Defense Contract Management Agency (DCMA) and the contracting officer at the Defense Logistics Agency. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified goods. Transparency is facilitated through contract award databases, though detailed performance metrics are not publicly available.

Related Government Programs

Defense Logistics Agency Procurement
Construction Equipment Procurement
Military Vehicle and Equipment Manufacturing
Department of Defense Supply Chain Management

Risk Flags

Potential supply chain vulnerability
Long-term sustainment cost uncertainty

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.0 million to MACK DEFENSE LLC. 8509850317!VOLVO TRACTOR

Who is the contractor on this award?

The obligated recipient is MACK DEFENSE LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $26.0 million.

What is the period of performance?

Start: 2023-04-24. End: 2024-12-31.

What is the specific type and model of Volvo tractor being procured, and what are its key technical specifications relevant to DoD operations?

The provided data indicates 'VOLVO TRACTOR' as the item description, with a Product Service Code (PSC) of '3930' (Construction and Engineering Machinery and Equipment). However, the specific model and detailed technical specifications are not included in this summary. Typically, such procurements would specify models like the Volvo L-series wheel loaders or A-series articulated haulers, chosen for their durability, load capacity, and suitability for various terrain. The technical specifications would detail engine power, transmission type, hydraulic systems, operator cabin features, and compliance with military standards for ruggedness and environmental resistance. These details are crucial for ensuring the machinery meets the demanding operational requirements of the Department of Defense, such as use in construction, logistics support, and potentially forward operating base development.

How does the awarded price of $26 million compare to historical spending on similar construction machinery by the Defense Logistics Agency or other DoD components?

Comparing the $26 million award requires a baseline of historical spending on comparable construction machinery. The Defense Logistics Agency (DLA) and other DoD entities procure a wide range of heavy equipment. For instance, if this award is for a significant quantity of high-capacity wheel loaders or specialized earthmoving equipment, $26 million over approximately two years might represent a competitive price point, especially considering inflation and supply chain dynamics. However, without knowing the exact quantity, models, and duration of previous procurements, a precise comparison is difficult. A review of past DLA solicitations and awards for similar PSCs (e.g., 3930, 3910 - Tractors) over the last 5-10 years would be necessary. Factors like whether previous contracts were sole-source versus competitively bid, and the economic conditions at the time of those awards, would also influence the comparison. The current award's firm fixed-price nature suggests a deliberate effort to lock in costs.

What are the primary risks associated with this contract, and what mitigation strategies are likely in place?

Primary risks for this contract include potential supply chain disruptions affecting delivery timelines, especially given global manufacturing and shipping challenges. Another risk is the obsolescence of technology if the machinery has a long service life and is not updated. Performance risks, such as equipment failure or inadequate maintenance support from the contractor, are also present. Mitigation strategies likely include robust contract clauses requiring timely delivery and performance standards, penalties for non-compliance, and potentially requiring the contractor to maintain adequate spare parts inventory. The DLA's extensive experience in logistics and equipment management suggests established procedures for risk assessment and mitigation, possibly involving regular performance reviews and contingency planning for equipment downtime.

What is the expected operational lifespan and maintenance plan for the procured construction machinery?

The expected operational lifespan and maintenance plan for the procured Volvo tractors are not detailed in the provided award data. However, construction machinery, particularly from reputable manufacturers like Volvo, is typically designed for extended service lives, often ranging from 10 to 20 years or more, depending on usage intensity and maintenance. The Department of Defense generally requires equipment that can withstand rigorous use in diverse environments. Maintenance plans are usually a combination of contractor-provided support (especially during warranty periods) and organic military maintenance. The contract may specify requirements for technical manuals, spare parts availability, and potentially field service support. The DLA's role often involves ensuring the long-term availability and maintainability of such assets within the military's operational framework.

How does this contract align with the DoD's broader strategy for modernizing its equipment fleet and ensuring logistical readiness?

This contract aligns with the DoD's broader strategy by ensuring the continued availability of essential construction machinery, which is fundamental to logistical readiness and operational support. Modernizing the equipment fleet involves acquiring reliable, efficient, and technologically appropriate assets. While the specific models procured here may not represent cutting-edge technology, their selection likely reflects a balance between capability, cost-effectiveness, and proven reliability. Ensuring logistical readiness means having the right equipment in the right place at the right time, and this contract directly addresses the need for construction machinery that supports infrastructure development, base operations, and deployment activities across various theaters. The full and open competition aspect also supports the strategy by leveraging market efficiencies to acquire these necessary assets.

Industry Classification

NAICS: Manufacturing › Agriculture, Construction, and Mining Machinery Manufacturing › Construction Machinery Manufacturing

Product/Service Code: CONSTRUCT/MINE/EXCAVATE/HIGHWY EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 7310 TILGHMAN ST STE 600, ALLENTOWN, PA, 18106

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

Financial Breakdown

Contract Ceiling: $26,029,382

Exercised Options: $26,029,382

Current Obligation: $26,029,382

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPE8EC18D0015

IDV Type: IDC

Timeline