DoD awards $118M for military vehicle components, raising questions about competition and value

Contract Overview

Contract Amount: $118,375,740 ($118.4M)

Contractor: Global Military Products Inc

Awarding Agency: Department of Defense

Start Date: 2023-05-31

End Date: 2024-10-21

Contract Duration: 509 days

Daily Burn Rate: $232.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: AWARD FOR JPEO A&A.

Place of Performance

Location: TAMPA, HILLSBOROUGH County, FLORIDA, 33607

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $118.4 million to GLOBAL MILITARY PRODUCTS INC for work described as: AWARD FOR JPEO A&A. Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Significant contract value for military vehicle components suggests a critical need within the Department of Defense. 3. Fixed-price contract type aims to control costs, but sole-source nature may negate savings. 4. Awarded to Global Military Products Inc., a single bidder, indicating a lack of broader market engagement. 5. Performance period extends over a year, suggesting a sustained requirement for these components. 6. Geographic location in Florida for contract performance noted.

Value Assessment

Rating: questionable

The contract's value of $118.4 million for military vehicle components is substantial. However, without competitive bidding, it is difficult to benchmark the pricing against market rates or similar contracts. The fixed-price nature is a positive cost control measure, but the lack of competition raises concerns about whether the government secured the best possible value. Further analysis would be needed to determine if the pricing is reasonable in the absence of a competitive process.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Global Military Products Inc., was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source awards can be justified under specific circumstances (e.g., urgency, unique capabilities), they inherently limit the government's ability to leverage competition to drive down prices and ensure the best value.

Taxpayer Impact: The lack of competition means taxpayers may not benefit from the cost savings typically achieved through a bidding process. This could result in a higher overall expenditure for these essential military components.

Public Impact

The primary beneficiaries are the Department of Defense and potentially military personnel who rely on these armored vehicle components. The contract delivers critical components for military armored vehicles, supporting national defense readiness. Contract performance is located in Florida, potentially impacting the local economy and workforce in that region. The award supports the manufacturing sector, specifically within the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and potentially inflates costs for taxpayers.
Lack of transparency in the bidding process makes it difficult to assess true value for money.
Contract duration of over a year requires ongoing monitoring to ensure performance and cost control.

Positive Signals

Fixed-price contract type provides some cost certainty.
Award supports the defense industrial base and critical military equipment manufacturing.

Sector Analysis

This contract falls within the Defense Industrial Base sector, specifically focusing on the manufacturing of military vehicles and their components. The market for such specialized parts is often characterized by a limited number of qualified suppliers due to stringent technical requirements and security clearances. Spending in this area is directly tied to national defense priorities and procurement cycles. Comparable spending benchmarks would typically involve analyzing historical awards for similar vehicle components or related manufacturing services within the DoD.

Small Business Impact

The data indicates this contract was not competed and does not appear to have a small business set-aside. Therefore, there are no direct subcontracting implications for small businesses stemming from this specific award mechanism. The focus is on a single, likely larger, prime contractor. The absence of a set-aside means opportunities for small businesses to participate as direct awardees or through competitive subcontracting are not explicitly facilitated by this contract's structure.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army and the Department of Defense's contracting and program management offices. Accountability measures are typically embedded in the contract terms, including performance standards and delivery schedules. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Military Vehicle Procurement
Defense Manufacturing Contracts
Armored Vehicle Component Supply
Department of the Army Contracts
Sole-Source Defense Awards

Risk Flags

Sole-source award lacks competitive justification.
Potential for inflated pricing due to lack of competition.
Limited transparency in the procurement process.
Need for robust performance monitoring due to single-source provider.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $118.4 million to GLOBAL MILITARY PRODUCTS INC. AWARD FOR JPEO A&A.

Who is the contractor on this award?

The obligated recipient is GLOBAL MILITARY PRODUCTS 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 $118.4 million.

What is the period of performance?

Start: 2023-05-31. End: 2024-10-21.

What specific military armored vehicle components are being procured under this contract?

The provided data indicates the contract is for 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' (NAICS code 336992). However, the specific components are not detailed in the summary. Typically, such contracts could include a wide range of parts such as engines, transmissions, armor plating, suspension systems, weapon mounts, or electronic components. A deeper dive into the contract's statement of work or associated documentation would be necessary to identify the precise items being supplied by Global Military Products Inc.

Why was this contract awarded on a sole-source basis instead of being competed?

The data explicitly states the contract was 'NOT COMPETED'. Sole-source awards are typically justified when only one responsible source is available or capable of meeting the requirement. This could be due to unique proprietary technology, specialized manufacturing capabilities, urgent and compelling needs where competition is impractical, or if the value is below the threshold requiring full competition. Without further justification documents (e.g., Justification and Approval for Other Than Full and Open Competition), the specific reason for this sole-source award remains unclear, raising concerns about potential missed opportunities for better pricing through competition.

How does the $118.4 million award compare to historical spending on similar military vehicle components?

Benchmarking this $118.4 million award requires comparing it to historical spending on similar military vehicle components. Without access to a comprehensive database of past contracts for identical or closely related parts, a precise comparison is difficult. However, the magnitude of the award suggests a significant procurement. Analyzing trends in defense spending for armored vehicle sustainment and upgrades, or looking at contracts awarded to other major defense manufacturers for similar systems, could provide context. The sole-source nature complicates direct value comparisons, as competitive awards often yield lower prices per unit.

What is the track record of Global Military Products Inc. in fulfilling defense contracts, particularly for armored vehicle components?

Information on Global Military Products Inc.'s track record is not detailed in the provided data. To assess their performance, one would need to examine their contract history with the DoD and other federal agencies. Key factors to consider include past performance ratings, on-time delivery rates, quality of products, and any history of contract disputes or terminations. A positive track record would lend confidence to the award, while a history of issues would heighten concerns, especially given the sole-source nature of this significant contract.

What are the potential risks associated with a sole-source award of this magnitude?

The primary risks associated with a sole-source award of this magnitude include: 1) Paying a premium price due to the lack of competitive pressure, leading to inefficient use of taxpayer funds. 2) Potential for complacency from the contractor, as there is no immediate competitive threat to incentivize superior performance or innovation. 3) Limited visibility into alternative solutions or technologies that other companies might offer. 4) Difficulty in verifying the reasonableness of the price without market comparisons. 5) Potential for the contractor to leverage their sole-source position for future contract negotiations.

What oversight mechanisms are in place to ensure the effective use of funds and successful delivery of components?

Oversight for this contract would typically involve several layers. The contracting officer at the Department of the Army is responsible for administering the contract and ensuring compliance with its terms. Program managers oversee the technical aspects and ensure the components meet specifications. Quality assurance personnel would likely inspect the delivered components. Performance metrics and reporting requirements within the contract itself serve as oversight tools. Furthermore, the DoD's internal audit and Inspector General functions provide an additional layer of oversight to detect and prevent fraud, waste, and abuse.

Industry Classification

NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

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: Global Ordnance LLC

Address: 2701 NORTH ROCKY POINT DRIVE, TAMPA, FL, 33607

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $118,375,740

Exercised Options: $118,375,740

Current Obligation: $118,375,740

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline