Department of the Army awards $116.7M for high-velocity target practice cartridges to AMTEC CORPORATION
Contract Overview
Contract Amount: $116,696,332 ($116.7M)
Contractor: Amtec Corporation
Awarding Agency: Department of Defense
Start Date: 2024-05-17
End Date: 2026-07-31
Contract Duration: 805 days
Daily Burn Rate: $145.0K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DELIVERY ORDER 1 FOR 40MM M918E2 HIGH VELOCITY (HV) TARGET PRACTICE- DAY/NIGHT/THERMAL (TP-DNT) CARTRIDGE
Place of Performance
Location: JANESVILLE, ROCK County, WISCONSIN, 53546
Plain-Language Summary
Department of Defense obligated $116.7 million to AMTEC CORPORATION for work described as: DELIVERY ORDER 1 FOR 40MM M918E2 HIGH VELOCITY (HV) TARGET PRACTICE- DAY/NIGHT/THERMAL (TP-DNT) CARTRIDGE Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract is for ammunition manufacturing, specifically high-velocity target practice cartridges. 3. Delivery order is part of a larger contract with a base value of $1.45M. 4. The contract duration is 805 days, indicating a medium-term supply requirement. 5. The award is a Delivery Order, suggesting it's a call against an existing contract or agreement. 6. The fixed-price contract type aims to control costs for the government.
Value Assessment
Rating: good
The total award amount of $116.7 million for ammunition manufacturing appears substantial. Benchmarking against similar contracts for specialized ammunition would be necessary for a precise value-for-money assessment. However, the firm fixed-price structure is a positive indicator for cost control. The base contract value of $1.45 million suggests this delivery order represents a significant expansion or replenishment of existing stock.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to better pricing and terms for the government. The agency sought proposals from a wide range of potential suppliers.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the potential for competitive pricing and encourages innovation among suppliers, ultimately leading to more cost-effective procurement of essential defense materials.
Public Impact
The primary beneficiaries are the Department of the Army and its personnel, who will receive essential training and operational materiel. The contract delivers high-velocity target practice cartridges, crucial for realistic combat simulations and marksmanship training. The geographic impact is primarily within the United States, where the ammunition will be manufactured and potentially distributed. Workforce implications include job creation and maintenance within the defense manufacturing sector, specifically for AMTEC CORPORATION and its supply chain.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of specific competition details (number of bidders) limits full assessment of price discovery.
- Potential for price escalation in future delivery orders if market conditions change significantly.
- Dependence on a single contractor for a critical defense supply item could pose a risk if supply chain issues arise.
Positive Signals
- Awarded under full and open competition, maximizing potential for competitive pricing.
- Firm Fixed Price contract type provides cost certainty for the government.
- AMTEC CORPORATION's role as a supplier of ammunition indicates established capabilities.
- The delivery order structure suggests a pre-existing relationship or framework agreement, potentially streamlining future procurements.
Sector Analysis
This contract falls within the defense manufacturing sector, specifically focusing on ammunition production. The market for military-grade ammunition is characterized by stringent quality requirements, specialized manufacturing processes, and significant government demand. AMTEC CORPORATION operates in a niche that requires adherence to strict military specifications and often involves long-term supply agreements with defense agencies. Comparable spending benchmarks would involve analyzing other large-scale ammunition procurements by the DoD.
Small Business Impact
The provided data indicates that small business participation (sb) is false, and there is no mention of small business set-asides. This suggests that the primary contract was not specifically targeted towards small businesses. Subcontracting opportunities for small businesses may exist within AMTEC CORPORATION's supply chain, but this is not detailed in the award information. The impact on the small business ecosystem is likely indirect, depending on AMTEC's sourcing strategies.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver goods at the agreed-upon price. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Department of Defense Ammunition Procurement
- Army Training and Doctrine Command (TRADOC) Materiel Needs
- Defense Logistics Agency (DLA) Ammunition Stockpiles
- Tactical Vehicle Ammunition Requirements
Risk Flags
- Potential for supply chain disruption
- Quality control of ammunition manufacturing
- Dependence on a single awardee for this delivery order
Tags
defense, ammunition, department-of-the-army, amtec-corporation, high-velocity-cartridge, target-practice, firm-fixed-price, full-and-open-competition, delivery-order, manufacturing, wisconsin, us-department-of-defense
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $116.7 million to AMTEC CORPORATION. DELIVERY ORDER 1 FOR 40MM M918E2 HIGH VELOCITY (HV) TARGET PRACTICE- DAY/NIGHT/THERMAL (TP-DNT) CARTRIDGE
Who is the contractor on this award?
The obligated recipient is AMTEC CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $116.7 million.
What is the period of performance?
Start: 2024-05-17. End: 2026-07-31.
What is AMTEC CORPORATION's track record with the Department of Defense, particularly in supplying ammunition?
AMTEC CORPORATION has a history of supplying ammunition to the Department of Defense. While specific details of past performance are not provided in this award notice, their selection for a significant delivery order suggests a demonstrated capability to meet DoD requirements. Further investigation into their contract history, including past performance reviews and any reported issues, would provide a more comprehensive understanding of their reliability and quality assurance. Their ability to secure this contract implies they have met the necessary technical, quality, and delivery standards previously.
How does the unit cost of these high-velocity target practice cartridges compare to similar procurements or market rates?
The provided data does not include the unit cost for the 40MM M918E2 cartridges, making a direct comparison difficult. The total award amount of $116.7 million is for a specific quantity of these cartridges, but that quantity is not specified. To assess value for money, one would need to know the number of units procured to calculate a per-unit price. This per-unit price could then be benchmarked against historical DoD procurements of similar ammunition types, or against commercial off-the-shelf (COTS) pricing if applicable, though military-grade ammunition often commands a premium due to stringent specifications and testing.
What are the primary risks associated with this contract, and how are they being mitigated?
Key risks include potential supply chain disruptions affecting AMTEC CORPORATION's ability to deliver, quality control issues with the ammunition, and potential cost overruns if the firm fixed-price contract has unforeseen contingencies. Mitigation strategies likely involve robust quality assurance processes mandated by the contract, performance monitoring by the Army, and potentially requiring AMTEC to maintain certain inventory levels or have contingency plans for raw material sourcing. The full and open competition aims to mitigate risks associated with sole-source dependency, but reliance on a single awardee for this specific delivery order remains a factor.
How effective is the firm fixed-price contract type in ensuring value for money for this specific ammunition procurement?
The firm fixed-price (FFP) contract type is generally effective in ensuring value for money by shifting the risk of cost overruns to the contractor. For standard, well-defined items like ammunition, FFP provides cost certainty for the government. AMTEC CORPORATION is incentivized to manage its production costs efficiently to maintain profitability. However, the effectiveness can be diminished if the initial price was not competitively established or if unforeseen technical challenges arise that were not adequately accounted for during the bidding process. Robust technical specifications and oversight are still crucial to ensure the delivered product meets requirements.
What is the historical spending pattern for this type of ammunition by the Department of the Army?
Historical spending on 40MM M918E2 High Velocity (HV) Target Practice (TP-DNT) cartridges by the Department of the Army is not detailed in the provided data. However, the base contract value of $1.45 million, with this delivery order significantly exceeding it at $116.7 million, suggests a substantial increase in demand or a major replenishment effort. Analyzing past contract awards for similar ammunition types over several fiscal years would reveal trends in procurement volume, pricing, and the number of contractors involved, providing context for the current award's scale.
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
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: National Presto Industries, Inc.
Address: 4230 CAPITAL CIR, JANESVILLE, WI, 53546
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $116,696,332
Exercised Options: $116,696,332
Current Obligation: $116,696,332
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W15QKN24D0022
IDV Type: IDC
Timeline
Start Date: 2024-05-17
Current End Date: 2026-07-31
Potential End Date: 2026-07-31 00:00:00
Last Modified: 2025-08-14
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