DoD awards $159M for mortar projectile shell bodies, with General Dynamics OTS as sole contractor

Contract Overview

Contract Amount: $159,322,386 ($159.3M)

Contractor: General Dynamics OTS (wilkes Barre), LLC

Awarding Agency: Department of Defense

Start Date: 2007-02-13

End Date: 2014-09-30

Contract Duration: 2,786 days

Daily Burn Rate: $57.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: REQUIREMENTS FOR MANUFACTURE,INSPECTION,AND DELIVERY OF 60MM&81MM MORTAR PROJECTILE (SHELL BODIES). THIS INCLUDES SEVEN SHELL BODY TYPES WHICH ARE COMPRISED OF THE FOLLOWING: M769, PAINTED BODY, M720A1, BODY ASSEMBLY FOR PROJECTILE 60MM , HE , M720 HIGH EXPLOSIVE, M879A1, 81MM PRACTICE ROUND, M821, 81MM, HIGH EXPLOSIVE, M879A1, 81MM PRACTICE ROUND, M722, SMOKE ROUND. ALL SHELL BODIES PRODUCED UNDER THIS EFFORT WILL SUPPORT THE LOAD/ ASSEMBLE/PACK (LAP) OF 60MM&81MM FORGED HIGH EXPLOSIVE, M879, 81MM PRACTICE ROUNDS , AND WHITE PHOSPHORUS (WP) SMOKE ROUNDS.

Place of Performance

Location: WILKES BARRE, LUZERNE County, PENNSYLVANIA, 18702

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $159.3 million to GENERAL DYNAMICS OTS (WILKES BARRE), LLC for work described as: REQUIREMENTS FOR MANUFACTURE,INSPECTION,AND DELIVERY OF 60MM&81MM MORTAR PROJECTILE (SHELL BODIES). THIS INCLUDES SEVEN SHELL BODY TYPES WHICH ARE COMPRISED OF THE FOLLOWING: M769, PAINTED BODY, M720A1, BODY ASSEMBLY FOR PROJECTILE 60MM , HE , M720 HIGH EXPLOSIVE, M879A1, 81MM PR… Key points: 1. The contract covers seven types of 60mm and 81mm mortar projectile shell bodies. 2. General Dynamics OTS (Wilkes Barre), LLC is the sole contractor for this requirement. 3. The contract was awarded under 'Full and Open Competition after Exclusion of Sources', raising questions about competition. 4. This spending falls under the Defense sector, specifically for ammunition procurement.

Value Assessment

Rating: fair

The contract value of $159.3 million over approximately 7.5 years suggests a moderate annual spend. Benchmarking against similar ammunition production contracts would be necessary to fully assess pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition after Exclusion of Sources', indicating that while competition was sought, only one source was ultimately viable or selected. This method can limit price discovery and potentially lead to higher costs.

Taxpayer Impact: Taxpayer funds are being used for essential military munitions. The limited competition aspect warrants scrutiny to ensure fair pricing and value for money.

Public Impact

Ensures supply of critical mortar ammunition for U.S. Army operations. Supports military readiness by providing components for high-explosive and smoke rounds. The contract's duration and value indicate a significant, long-term commitment to this specific supplier. Potential for increased costs due to limited competition could impact overall defense budget efficiency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about price reasonableness.
Sole source award after exclusion of other sources needs justification.
Lack of small business participation noted.

Positive Signals

Ensures critical supply of mortar projectiles.
Firm Fixed Price contract provides cost certainty.
Long-term contract supports stable production.

Sector Analysis

This contract falls within the defense industrial base, specifically focusing on the manufacturing of ammunition components. Spending benchmarks for similar munitions contracts are highly variable based on type, quantity, and technological complexity.

Small Business Impact

The data indicates that small businesses were not directly involved as prime contractors in this award (sb: false). Further analysis would be needed to determine if small businesses participated as subcontractors.

Oversight & Accountability

The contract was awarded by the Department of the Army. Oversight would typically involve contract management by the relevant Army contracting command to ensure delivery, quality, and adherence to terms.

Related Government Programs

Facilities Support Services
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Limited competition may result in inflated prices.
Sole-source award after initial open competition raises transparency concerns.
Lack of small business prime participation.
Dependence on a single supplier for critical defense components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $159.3 million to GENERAL DYNAMICS OTS (WILKES BARRE), LLC. REQUIREMENTS FOR MANUFACTURE,INSPECTION,AND DELIVERY OF 60MM&81MM MORTAR PROJECTILE (SHELL BODIES). THIS INCLUDES SEVEN SHELL BODY TYPES WHICH ARE COMPRISED OF THE FOLLOWING: M769, PAINTED BODY, M720A1, BODY ASSEMBLY FOR PROJECTILE 60MM , HE , M720 HIGH EXPLOSIVE, M879A1, 81MM PRACTICE ROUND, M821, 81MM, HIGH EXPLOSIVE, M879A1, 81MM PRACTICE ROUND, M722, SMOKE ROUND. ALL SHELL BODIES PRODUCED UNDER THIS EFFORT WILL SUPPORT THE LOAD/ ASSEMBLE/PACK (LAP) OF 60MM&81MM FORGED HIGH EXPLOSIVE, M879, 8

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS OTS (WILKES BARRE), LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $159.3 million.

What is the period of performance?

Start: 2007-02-13. End: 2014-09-30.

What was the justification for excluding other sources if the competition was intended to be full and open?

The justification for excluding other sources after an initial 'full and open' competition is crucial. It typically involves technical non-conformance, inability to meet production schedules, or unique proprietary capabilities. Without specific documentation, it's difficult to ascertain the precise reason, but it suggests that only one offeror met the stringent requirements, potentially limiting competitive pressure on pricing.

How does the per-unit cost of these shell bodies compare to industry benchmarks for similar munitions?

Benchmarking the per-unit cost is essential for evaluating value. Given the $159.3 million award for an unspecified quantity of seven different shell body types over nearly eight years, calculating a precise per-unit cost is challenging without quantity breakdowns. However, the limited competition suggests a potential for higher costs than if robust competition had been sustained throughout the contract lifecycle.

What is the long-term strategic impact of relying on a single supplier for these critical mortar components?

Relying on a single supplier for critical components like mortar shell bodies can create strategic vulnerabilities. While it ensures a consistent supply chain for the duration of the contract, it reduces flexibility and bargaining power for future procurements. Dependence on one firm could also stifle innovation and potentially lead to price increases once the current contract expires, necessitating a review of industrial base capabilities.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W15QKN06R0324

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1500 HIGHWAY 315, WILKES BARRE, PA, 08

Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $159,322,386

Exercised Options: $159,322,386

Current Obligation: $159,322,386

Contract Characteristics

Cost or Pricing Data: YES

Timeline