DoD awards $147.7M missile spares contract to On-Point Defense Technologies, raising competition concerns
Contract Overview
Contract Amount: $14,768,710 ($14.8M)
Contractor: On-Point Defense Technologies LLC
Awarding Agency: Department of Defense
Start Date: 2023-08-15
End Date: 2026-03-31
Contract Duration: 959 days
Daily Burn Rate: $15.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: MISSILE SPARES PROCUREMENT
Place of Performance
Location: FORT WALTON BEACH, OKALOOSA County, FLORIDA, 32548
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $14.8 million to ON-POINT DEFENSE TECHNOLOGIES LLC for work described as: MISSILE SPARES PROCUREMENT Key points: 1. Significant contract value for specialized missile parts. 2. Sole-source award limits competitive pricing and innovation. 3. Potential for higher costs due to lack of competition. 4. Defense sector spending on critical components.
Value Assessment
Rating: questionable
The contract value of $147.7 million for missile spares is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to offer the best price.
Taxpayer Impact: The lack of competition may result in inflated prices, meaning taxpayers could be paying more than necessary for these critical missile spares.
Public Impact
Ensures availability of critical missile components for national defense. Potential for taxpayer overpayment due to non-competitive award. Limited transparency into the pricing justification. Impacts the broader defense industrial base's ability to compete.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- Potential for cost overruns
Positive Signals
- Ensures supply chain for critical defense items
- Supports a specific defense contractor
Sector Analysis
This contract falls within the defense sector, specifically for the manufacturing of missile propulsion unit parts. Spending in this area is critical for national security, but often involves specialized, high-cost components.
Small Business Impact
The awardee, ON-POINT DEFENSE TECHNOLOGIES LLC, is not identified as a small business. The lack of competition may also limit opportunities for small businesses that could potentially supply components or services.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the government is receiving fair value. Transparency regarding the justification for the sole-source award and the pricing structure is crucial.
Related Government Programs
- Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing.
- Lack of transparency in pricing justification.
- Limited opportunities for other vendors.
- Risk of contractor dependency.
Tags
guided-missile-and-space-vehicle-propuls, department-of-defense, fl, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $14.8 million to ON-POINT DEFENSE TECHNOLOGIES LLC. MISSILE SPARES PROCUREMENT
Who is the contractor on this award?
The obligated recipient is ON-POINT DEFENSE TECHNOLOGIES LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $14.8 million.
What is the period of performance?
Start: 2023-08-15. End: 2026-03-31.
What is the justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. Agencies must document these reasons thoroughly. Alternative competitive strategies, such as market research to identify potential sources or phased approaches, should be explored before resorting to sole-source procurement to ensure the best value for the government.
How will the Department of Defense ensure fair and reasonable pricing without competitive bidding for these missile spares?
Ensuring fair and reasonable pricing in sole-source contracts relies heavily on robust cost analysis, price negotiation, and auditing. The Defense Contract Audit Agency (DCAA) may conduct audits of the contractor's cost proposals. The government should also benchmark prices against historical data for similar items, if available, and leverage negotiation expertise to challenge inflated costs.
What is the long-term impact of sole-source awards on the overall cost and availability of missile components in the defense supply chain?
Sole-source awards can stifle innovation and competition over the long term, potentially leading to higher sustained costs and reduced availability as fewer companies invest in developing capabilities. This can create dependencies on specific contractors, making the supply chain less resilient and more vulnerable to disruptions or price increases.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing
Product/Service Code: GUIDED MISSLES
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: 737 HOLLYWOOD BLVD NW, FORT WALTON BEACH, FL, 32548
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business
Financial Breakdown
Contract Ceiling: $14,768,710
Exercised Options: $14,768,710
Current Obligation: $14,768,710
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2023-08-15
Current End Date: 2026-03-31
Potential End Date: 2026-03-31 12:03:00
Last Modified: 2025-12-22
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