DoD Awards $12.2M for Crane Parts to Konecranes Inc. to Meet Warfighter Needs Urgently
Contract Overview
Contract Amount: $12,253,992 ($12.3M)
Contractor: Konecranes Inc
Awarding Agency: Department of Defense
Start Date: 2024-05-03
End Date: 2027-11-02
Contract Duration: 1,278 days
Daily Burn Rate: $9.6K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: THE PURPOSE OF THIS DELIVERY ORDER IS TO PROCURE THE REMAINING PARTS ON A SOON TO EXPIRE LTC IN ORDER TO MEET THE NEEDS OF THE WARFIGHTER IN THE FASTEST METHOD POSSIBLE.
Place of Performance
Location: WATERTOWN, JEFFERSON County, WISCONSIN, 53094
Plain-Language Summary
Department of Defense obligated $12.3 million to KONECRANES INC for work described as: THE PURPOSE OF THIS DELIVERY ORDER IS TO PROCURE THE REMAINING PARTS ON A SOON TO EXPIRE LTC IN ORDER TO MEET THE NEEDS OF THE WARFIGHTER IN THE FASTEST METHOD POSSIBLE. Key points: 1. Urgent need for warfighter support drives rapid procurement. 2. Sole-source award to Konecranes Inc. for remaining parts. 3. Potential for higher costs due to limited competition. 4. Defense Logistics Agency manages this critical acquisition.
Value Assessment
Rating: fair
The contract value of $12.2M for overhead traveling crane parts appears reasonable given the urgent need and the nature of specialized equipment. However, without specific benchmarks for similar urgent, sole-source procurements, a definitive value assessment is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This is a sole-source award, indicating no competition was sought. This approach prioritizes speed to meet warfighter needs but likely results in a higher price than if multiple vendors had competed.
Taxpayer Impact: Taxpayer funds are used for this acquisition, with the cost potentially inflated due to the lack of competitive bidding.
Public Impact
Ensures critical equipment for warfighters is maintained and operational. Supports ongoing defense readiness by providing necessary parts. Highlights the challenges of rapid procurement in defense.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition.
- Urgency may lead to premium pricing.
- Long contract duration for parts procurement.
Positive Signals
- Addresses critical warfighter needs.
- Ensures operational readiness.
Sector Analysis
This contract falls under the Overhead Traveling Crane, Hoist, and Monorail System Manufacturing sector. Spending in this niche area is often driven by specific defense or industrial needs, with limited market size impacting competition.
Small Business Impact
There is no indication that small businesses were involved in this specific sole-source award. The focus was on procuring remaining parts from an incumbent or specialized supplier.
Oversight & Accountability
The award is managed by the Defense Logistics Agency, which is responsible for ensuring efficient and effective logistics support for the DoD. Oversight would focus on ensuring the parts meet specifications and the price is justified under the sole-source justification.
Related Government Programs
- Overhead Traveling Crane, Hoist, and Monorail System Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award
- Urgent need justification
- Potential for price inflation
- Lack of small business participation
- Long contract duration for parts
Tags
overhead-traveling-crane-hoist-and-monor, department-of-defense, wi, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $12.3 million to KONECRANES INC. THE PURPOSE OF THIS DELIVERY ORDER IS TO PROCURE THE REMAINING PARTS ON A SOON TO EXPIRE LTC IN ORDER TO MEET THE NEEDS OF THE WARFIGHTER IN THE FASTEST METHOD POSSIBLE.
Who is the contractor on this award?
The obligated recipient is KONECRANES INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $12.3 million.
What is the period of performance?
Start: 2024-05-03. End: 2027-11-02.
What was the justification for the sole-source award, and were alternative rapid procurement methods explored?
The justification for the sole-source award is the urgent need to meet warfighter requirements via the fastest method possible, likely due to an expiring contract. While speed was prioritized, it's crucial to understand if other expedited competitive processes were considered and deemed less feasible or slower than this sole-source approach.
How does the unit cost of these parts compare to industry benchmarks for similar specialized crane components, especially considering the sole-source nature?
Benchmarking the unit cost is difficult without knowing the specific parts and their complexity. However, sole-source awards typically command a premium. A thorough review would involve comparing pricing against Konecranes' commercial catalog prices and, if possible, against historical data for similar urgent DoD procurements to assess value.
What is the long-term strategy for ensuring competitive sourcing of these critical crane parts to avoid future sole-source situations?
The long-term strategy should involve proactive market research and planning to identify potential alternative suppliers or to foster competition for future requirements. This could include breaking down the procurement into smaller lots, encouraging new entrants, or developing standardized specifications that allow for broader competition.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 4401 GATEWAY BLVD, SPRINGFIELD, OH, 45502
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $12,253,992
Exercised Options: $12,253,992
Current Obligation: $12,253,992
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: SPRDL121D0041
IDV Type: IDC
Timeline
Start Date: 2024-05-03
Current End Date: 2027-11-02
Potential End Date: 2027-11-02 12:11:00
Last Modified: 2025-10-16
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