DoD awards $38.6M for initial spares for WIN-T Increment 1 to General Dynamics

Contract Overview

Contract Amount: $38,613,194 ($38.6M)

Contractor: General Dynamics Mission Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2010-01-04

End Date: 2011-03-23

Contract Duration: 443 days

Daily Burn Rate: $87.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: AN UNDEFINITIZED CONTRACT ACTION TO PROCURE CHS-3 INITIAL SPARES FOR WIN-T INCREMENT 1

Place of Performance

Location: TAUNTON, BRISTOL County, MASSACHUSETTS, 02780

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $38.6 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: AN UNDEFINITIZED CONTRACT ACTION TO PROCURE CHS-3 INITIAL SPARES FOR WIN-T INCREMENT 1 Key points: 1. Contract awarded for initial spare parts, indicating a need for immediate operational readiness. 2. The contract is a firm-fixed-price type, which shifts cost risk to the contractor. 3. Awarded as a sole-source action, raising questions about potential cost efficiencies and market alternatives. 4. The duration of the contract is 443 days, suggesting a short-term need for these spares. 5. The contract is for CHS-3 initial spares, a component of the WIN-T Increment 1 program. 6. The award was made by the Department of the Army, a major component of the DoD.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar sole-source spare parts procurements. The fixed-price nature provides some cost certainty, but the lack of competition limits the ability to assess if the price reflects the best possible value. Further analysis would require understanding the criticality of these spares and the availability of alternative suppliers or repair options.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This approach is typically used when a unique capability or proprietary item is required, or in urgent situations. The lack of competition means that the government did not benefit from a bidding process that could have driven down prices through market forces. The justification for this sole-source award would be critical to understanding its necessity.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as the government cannot leverage competitive bidding to secure the best possible value. This limits price discovery and potentially increases the overall cost of the program.

Public Impact

The primary beneficiaries are the U.S. Army units relying on WIN-T Increment 1 for their communication and network operations. The services delivered are the provision of initial spare parts essential for maintaining the operational readiness of the WIN-T Increment 1 system. The geographic impact is likely nationwide, supporting Army deployments and operations across various locations. Workforce implications may include support personnel for the installation, maintenance, and logistics of these spare parts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Lack of competition may indicate a lack of market research or reliance on a single supplier.
Urgency or unique requirements driving sole-source award need clear justification to ensure value.
Firm-fixed-price contract, while shifting risk, could be at a premium due to non-competitive nature.

Positive Signals

Firm-fixed-price contract provides cost certainty once awarded.
Awarding initial spares ensures operational readiness for critical WIN-T Increment 1 systems.
General Dynamics is an established defense contractor with experience in complex systems.

Sector Analysis

The defense electronics manufacturing sector is characterized by high R&D costs, long product lifecycles, and significant government procurement. Contracts for military communication systems like WIN-T Increment 1 are crucial for maintaining technological superiority and operational effectiveness. The market often involves a limited number of large prime contractors capable of delivering complex integrated systems. Spending in this area is driven by evolving threats and the need for robust, secure communication networks.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the prime contractor, General Dynamics Mission Systems, Inc., is a large business. There is no explicit information provided regarding subcontracting plans to small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem from this particular award is unclear, though large prime contractors often utilize small businesses in their supply chains.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Transparency is limited due to the sole-source nature and the lack of publicly available detailed cost breakdowns. Accountability measures would be tied to the delivery of the specified spare parts according to the firm-fixed-price terms and schedule. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

WIN-T Increment 1 Program
Army Tactical Network Systems
Military Communications Equipment Procurement
Defense Logistics and Sustainment

Risk Flags

Sole-source award
Lack of competition
Potential for inflated pricing
Limited transparency on justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $38.6 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. AN UNDEFINITIZED CONTRACT ACTION TO PROCURE CHS-3 INITIAL SPARES FOR WIN-T INCREMENT 1

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS MISSION SYSTEMS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $38.6 million.

What is the period of performance?

Start: 2010-01-04. End: 2011-03-23.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED' and awarded as 'sole-source'. Typically, sole-source awards are justified when only one responsible source can provide the required supplies or services, such as when the item is proprietary, unique, or in cases of urgent and compelling need where competition is not feasible. For this specific contract, the justification would likely stem from the specialized nature of the CHS-3 initial spares for the WIN-T Increment 1 system, potentially requiring specific technical expertise or compatibility that only General Dynamics Mission Systems, Inc. could provide at that time. Without access to the official justification documentation (e.g., a Justification and Approval document), the precise reasons remain speculative but are rooted in the perceived necessity and lack of viable alternatives.

How does the firm-fixed-price (FFP) contract type impact the government's financial risk for this spare parts procurement?

A Firm-Fixed-Price (FFP) contract type means that the contractor, General Dynamics Mission Systems, Inc., is obligated to perform the work and deliver the CHS-3 initial spares for a predetermined, fixed price. This contract structure places the majority of the financial risk on the contractor. Unlike cost-reimbursement contracts, the government is not obligated to pay any costs the contractor incurs in excess of the agreed-upon fixed price, even if those costs are higher than anticipated. This provides the government with significant cost certainty. However, in a sole-source scenario, the 'fixed' price might be higher than it would be under competitive conditions, as the contractor does not face market pressure to minimize costs to win the bid. Therefore, while FFP limits cost overrun risk for the government, the initial price itself could be less advantageous without competition.

What is the historical spending pattern for CHS-3 initial spares or similar components within the WIN-T program?

The provided data only details this specific award of $38.6 million for CHS-3 initial spares with an award date of January 4, 2010. To understand historical spending patterns, one would need to access broader contract databases and program history for WIN-T Increment 1 and its subsequent increments. This would involve looking at prior awards for spares, sustainment, upgrades, and the overall system procurement. Analyzing trends in spending, contract types, and competition levels over time for the WIN-T program would reveal whether this $38.6 million award represents a typical investment for initial spares, or if it is an outlier. Without this broader context, it's difficult to establish a historical spending pattern based solely on this single data point.

What are the potential risks associated with procuring critical spare parts on a sole-source basis?

Procuring critical spare parts on a sole-source basis carries several potential risks for the government. Firstly, it significantly reduces the government's leverage in price negotiation, potentially leading to higher costs than if the parts were competitively procured. The absence of competition means the contractor faces less pressure to be efficient or offer the lowest possible price. Secondly, it can create vendor lock-in, making it difficult and costly to switch suppliers in the future, even if better alternatives emerge. Thirdly, sole-source awards can sometimes mask inefficiencies or a lack of proactive planning by the requiring activity, as they may be used as a default option rather than a last resort. Finally, it raises concerns about the overall health and competitiveness of the market for these specific parts, potentially limiting future sourcing options.

How does the duration of this contract (443 days) relate to the typical lifecycle of spare parts for military communication systems?

A contract duration of 443 days (approximately 14.5 months) for 'initial spares' suggests a relatively short-term, immediate need rather than long-term sustainment. Military communication systems, like WIN-T Increment 1, are complex and have lifecycles that can span many years, often decades. Initial spares are typically procured at the beginning of a system's deployment or major upgrade phase to ensure immediate operational readiness and to establish an initial inventory. The short duration implies that this procurement was focused on getting the system operational quickly and that follow-on procurements for sustainment spares, repair parts, or replacements would likely be handled through separate contracts, potentially with different terms and competition strategies, as the system matures and its long-term support requirements become clearer.

Industry Classification

NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

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

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 400 JOHN QUINCY ADAMS RD, TAUNTON, MA, 04

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $38,613,194

Exercised Options: $38,613,194

Current Obligation: $38,613,194

Contract Characteristics

Cost or Pricing Data: NO

Timeline