DoD Spends $43M on Track Shoe Sets via Sole Source Contract
Contract Overview
Contract Amount: $43,088,718 ($43.1M)
Contractor: Contitech USA, Inc
Awarding Agency: Department of Defense
Start Date: 2009-12-18
End Date: 2011-05-31
Contract Duration: 529 days
Daily Burn Rate: $81.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: TRACK SHOE SET,T-161
Place of Performance
Location: FAIRLAWN, SUMMIT County, OHIO, 44333
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $43.1 million to CONTITECH USA, INC for work described as: TRACK SHOE SET,T-161 Key points: 1. Significant expenditure on a specialized military component. 2. Sole-source procurement limits competitive pricing and innovation. 3. High cost raises questions about value for taxpayer money. 4. Sector is critical for armored vehicle maintenance.
Value Assessment
Rating: questionable
The total award of $43,088,717.76 for track shoe sets appears high, especially given the 'NOT COMPETED' status. Without competitive bids, it's difficult to assess if this price reflects fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, indicating a lack of competition. This method bypasses the typical price discovery mechanisms found in competitive bidding, potentially leading to higher costs for the government.
Taxpayer Impact: The absence of competition likely resulted in a higher price than could have been achieved through a competitive process, impacting taxpayer funds negatively.
Public Impact
Essential for maintaining operational readiness of armored vehicles. Lack of competition may lead to inflated costs for military equipment. Potential for limited availability or higher prices in future procurements.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement
- High contract value
- Lack of competition
Positive Signals
- Essential military component
Sector Analysis
This procurement falls within the Military Armored Vehicle, Tank, and Tank Component Manufacturing sector. Spending in this niche area is driven by defense needs and can be subject to higher costs due to specialized requirements and limited suppliers.
Small Business Impact
The data indicates that small businesses were not involved in this specific contract, as 'sb' is false. Further analysis would be needed to determine overall small business participation in this sector.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure the Department of Defense obtained the best possible value and that such awards are justified and not a result of circumventing competitive processes.
Related Government Programs
- Military Armored Vehicle, Tank, and Tank Component Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source justification questionable
- Potential for price inflation
- Lack of transparency in pricing
- Limited market research evident
Tags
military-armored-vehicle-tank-and-tank-c, department-of-defense, oh, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $43.1 million to CONTITECH USA, INC. TRACK SHOE SET,T-161
Who is the contractor on this award?
The obligated recipient is CONTITECH USA, INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $43.1 million.
What is the period of performance?
Start: 2009-12-18. End: 2011-05-31.
What is the justification for awarding this contract on a sole-source basis?
Sole-source awards are typically justified when only one responsible source can provide the required supplies or services, or when urgent and compelling circumstances prevent the use of competitive procedures. Without further documentation, the specific rationale for this track shoe set contract remains unclear and requires investigation.
What is the potential cost overrun or inefficiency due to the lack of competition?
Estimating the exact cost overrun is challenging without a benchmark. However, sole-source contracts often result in prices 10-30% higher than competitively procured items. For this $43M contract, this could translate to $4.3M to $12.9M in potential overspending.
How does the unit cost of these track shoe sets compare to similar items procured competitively?
Direct comparison is difficult without knowing the exact specifications and quantity per unit. However, given the sole-source nature and the total award value, it is probable that the per-unit cost is higher than if the contract had been subject to competitive bidding, potentially impacting overall program affordability.
Industry Classification
NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing
Product/Service Code: VEHICULAR EQUIPMENT COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 703 S CLEVELAND MASSILLON RD, FAIRLAWN, OH, 13
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $43,088,718
Exercised Options: $43,088,718
Current Obligation: $43,088,718
Contract Characteristics
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W56HZV08D0072
IDV Type: IDC
Timeline
Start Date: 2009-12-18
Current End Date: 2011-05-31
Potential End Date: 2011-05-31 00:00:00
Last Modified: 2011-12-15
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