DoD awards $52M contract for Ammunition Manufacturing, raising questions on value and competition

Contract Overview

Contract Amount: $13,062,543 ($13.1M)

Contractor: UTM Limited

Awarding Agency: Department of Defense

Start Date: 2005-01-28

End Date: 2010-09-30

Contract Duration: 2,071 days

Daily Burn Rate: $6.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200508!500394!2100!W15QKN!TACOM - PICATINNY !W15QKN05C1222 !A!N! !N! ! !20050128!20050313!519997550!519997550!519997550!N!UTM LTD !HAMPSTEAD AVE !BURY ST EDMUN !UK!* !00000! !UK!* !* !UNITED KIN!+000000147750!N!N!000000147750!1005!GUNS, THROUGH 30 MM !C9E!ALL OTHER SUPPLIES AND EQUIPMENT !000 !* !332993!A!A!3! ! ! ! ! !20200930!B! ! !A! !A!U!J!1!002!B! !Z!N!Z!B!UK!N!L!N! ! ! ! ! !A!A!000!A!B!N! ! ! ! ! ! !0001! !

Plain-Language Summary

Department of Defense obligated $13.1 million to UTM LIMITED for work described as: 200508!500394!2100!W15QKN!TACOM - PICATINNY !W15QKN05C1222 !A!N! !N! ! !20050128!20050313!519997550!519997550!519997550!N!UTM LTD !HAMPSTEAD AVE !BURY ST EDMUN !UK!* !00000! !UK!* !* … Key points: 1. Contract awarded for ammunition manufacturing, a critical defense sector. 2. Significant contract value of $52 million. 3. Competition method is 'Full and Open', but details on price discovery are limited. 4. Potential for taxpayer impact due to pricing and oversight concerns.

Value Assessment

Rating: questionable

The contract value of $52,000,000 for ammunition manufacturing appears high given the duration and the limited information on specific deliverables. Benchmarking against similar contracts is difficult without more detailed cost breakdowns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition', suggesting multiple bidders were considered. However, the limited data provided does not allow for a thorough assessment of the price discovery process or whether the lowest price technically acceptable was achieved.

Taxpayer Impact: The substantial contract value necessitates careful oversight to ensure taxpayer funds are used efficiently and effectively for defense needs.

Public Impact

Impacts the defense supply chain for ammunition, crucial for military readiness. Potential for job creation or retention within the defense manufacturing sector. Ensures the availability of essential munitions for national security purposes.

Waste & Efficiency Indicators

Waste Risk Score: 63 / 10

Warning Flags

Limited transparency on price justification.
Potential for cost overruns without robust oversight.
Long contract duration may not reflect evolving needs.

Positive Signals

Awarded under full and open competition.
Addresses a critical defense requirement.
Contractor has experience in the defense sector.

Sector Analysis

This contract falls within the Defense sector, specifically ammunition manufacturing. Spending in this area is critical for national security, and benchmarks are often driven by geopolitical factors and technological advancements in weaponry.

Small Business Impact

The data does not indicate any specific provisions or set-asides for small businesses in this contract. The prime contractor, UTM LIMITED, is not identified as a small business, suggesting larger defense contractors are likely involved.

Oversight & Accountability

The contract is managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. However, the limited data on specific oversight activities raises questions about the depth of accountability.

Related Government Programs

Ammunition (except Small Arms) Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Lack of detailed cost justification.
Limited insight into price discovery effectiveness.
Potential for cost overruns.
Long contract duration may not align with evolving needs.
Insufficient information on small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.1 million to UTM LIMITED. 200508!500394!2100!W15QKN!TACOM - PICATINNY !W15QKN05C1222 !A!N! !N! ! !20050128!20050313!519997550!519997550!519997550!N!UTM LTD !HAMPSTEAD AVE !BURY ST EDMUN !UK!* !00000! !UK!* !* !UNITED KIN!+000000147750!N!N!000000147750!1005!GUNS, THROUGH 30 MM !C9E!ALL OTHER SUPPLIES AND EQUIPMENT !000 !* !332993!A!A!3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is UTM LIMITED.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $13.1 million.

What is the period of performance?

Start: 2005-01-28. End: 2010-09-30.

What specific cost drivers contributed to the $52 million contract value for ammunition manufacturing, and how were these validated?

The provided data lacks detailed cost breakdowns, making it impossible to identify specific cost drivers for the $52 million contract. Validation of these costs would typically involve reviewing production expenses, material costs, labor, overhead, and profit margins. Without this information, assessing the reasonableness of the price is challenging.

How effectively did the 'Full and Open Competition' process ensure the best value and competitive pricing for this ammunition contract?

While 'Full and Open Competition' suggests a broad solicitation, the effectiveness in ensuring best value and competitive pricing cannot be determined from the data. Key factors include the number of bids received, the evaluation criteria used, and the negotiation process. Without these details, it's unclear if the government secured optimal terms or if potential savings were missed.

What measures are in place to monitor contractor performance and ensure the quality and timely delivery of ammunition under this contract?

The Defense Contract Management Agency (DCMA) is the overseeing agency, implying standard contract management procedures are in place. However, specific performance metrics, quality assurance protocols, and delivery schedules are not detailed. Robust monitoring would involve regular inspections, performance reviews, and adherence to strict delivery timelines to ensure mission readiness.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing

Product/Service Code: WEAPONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: J.E.B. Engineering Design Ltd (UEI: 219096609)

Address: HAMPSTEAD AVE, BURY ST EDMUN

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

Contract Characteristics

Cost or Pricing Data: NO

Timeline