DoD awards $125.7M to General Dynamics for 155mm M795 metal parts for Ukraine
Contract Overview
Contract Amount: $125,686,101 ($125.7M)
Contractor: General Dynamics OTS (wilkes Barre), LLC
Awarding Agency: Department of Defense
Start Date: 2022-09-26
End Date: 2026-01-30
Contract Duration: 1,222 days
Daily Burn Rate: $102.9K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Defense
Official Description: MANUFACTURE, PRODUCE, AND DELIVER 155MM M795 METAL PARTS IN SUPPORT OF UKRAINE DOD STOCK REPLENISHMENT.
Place of Performance
Location: WILKES BARRE, LUZERNE County, PENNSYLVANIA, 18702
Plain-Language Summary
Department of Defense obligated $125.7 million to GENERAL DYNAMICS OTS (WILKES BARRE), LLC for work described as: MANUFACTURE, PRODUCE, AND DELIVER 155MM M795 METAL PARTS IN SUPPORT OF UKRAINE DOD STOCK REPLENISHMENT. Key points: 1. Significant award for critical munitions support to Ukraine. 2. General Dynamics OTS is the sole awardee, raising questions about competition. 3. Fixed-price with economic price adjustment contract introduces cost escalation risk. 4. Spending supports defense industrial base and allied security.
Value Assessment
Rating: fair
The contract value of $125.7M for 155mm metal parts appears substantial. Benchmarking against similar munitions contracts is difficult without more specific cost breakdowns, but the economic price adjustment clause warrants close monitoring for potential cost overruns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition. However, only one offeror, General Dynamics OTS, was selected. This suggests either a highly specialized capability or potential limitations in the solicitation process that may have restricted broader participation, impacting price discovery.
Taxpayer Impact: Taxpayer funds are being used to replenish DoD stock, indirectly supporting Ukraine's defense efforts. The economic price adjustment could increase the final cost to taxpayers if material and labor costs rise significantly.
Public Impact
Direct support to Ukraine's defense capabilities. Strengthens US defense industrial base capacity for critical munitions. Potential for increased production of artillery shells. Impacts global ammunition supply chains.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Economic price adjustment increases cost risk.
- Limited apparent competition despite 'full and open' designation.
- Long performance period (over 3 years).
Positive Signals
- Supports critical allied nation.
- Addresses DoD stock replenishment needs.
- Utilizes established defense contractor.
Sector Analysis
This contract falls within the Ammunition (except Small Arms) Manufacturing sector. Spending in this sector is crucial for national defense and geopolitical stability, especially given current global conflicts. Benchmarks are highly sensitive to specific munition types and geopolitical demand.
Small Business Impact
The awardee, General Dynamics OTS, is a large business. There is no indication of small business participation in this specific contract, which is common for large-scale, specialized defense manufacturing efforts.
Oversight & Accountability
The Department of the Army is the contracting activity. Oversight will be critical to monitor performance, delivery schedules, and the impact of the economic price adjustment clause to ensure funds are used efficiently and effectively.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Potential for cost escalation due to EPA.
- Limited competition despite 'full and open' designation.
- Long contract duration increases exposure to market volatility.
- Dependence on a single supplier for critical components.
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, pa, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $125.7 million to GENERAL DYNAMICS OTS (WILKES BARRE), LLC. MANUFACTURE, PRODUCE, AND DELIVER 155MM M795 METAL PARTS IN SUPPORT OF UKRAINE DOD STOCK REPLENISHMENT.
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 $125.7 million.
What is the period of performance?
Start: 2022-09-26. End: 2026-01-30.
What specific factors led to only one offer being selected despite a 'full and open' competition for these 155mm metal parts?
The solicitation may have included highly specific technical requirements, stringent manufacturing standards, or unique production capabilities that only General Dynamics OTS could meet. Alternatively, the market research might have identified a limited number of capable sources, or the solicitation's structure might have inadvertently discouraged broader participation, leading to a single, viable offer.
How will the economic price adjustment (EPA) clause be managed to mitigate potential cost overruns for taxpayers?
The EPA clause allows for adjustments based on specific economic indicators, typically related to labor and material costs. Effective management requires robust tracking of these indicators, clear communication protocols between the government and contractor, and potentially setting caps or review triggers within the contract to limit excessive price increases and ensure fair value.
What is the projected impact of this contract on the overall readiness and supply chain for 155mm ammunition for both US forces and allies?
This contract directly contributes to replenishing DoD stocks and supporting Ukraine, which is vital for maintaining readiness and allied capabilities. By increasing production, it could alleviate some supply chain pressures, though the long-term impact depends on sustained demand, future contract awards, and the overall capacity of the defense industrial base.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W15QKN17R0018
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Parent Company: Wico Limited
Address: 1500 HIGHWAY 315 BLVD, WILKES BARRE, PA, 18702
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $125,686,101
Exercised Options: $125,686,101
Current Obligation: $125,686,101
Actual Outlays: $27,239,735
Subaward Activity
Number of Subawards: 15
Total Subaward Amount: $35,579,335
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W15QKN19D0084
IDV Type: IDC
Timeline
Start Date: 2022-09-26
Current End Date: 2026-01-30
Potential End Date: 2026-01-30 00:00:00
Last Modified: 2025-09-25
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