Army awards $51M for 120MM APFSDS-T Cartridges to General Dynamics

Contract Overview

Contract Amount: $50,994,095 ($51.0M)

Contractor: General Dynamics Ordnance and Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2025-05-16

End Date: 2027-04-17

Contract Duration: 701 days

Daily Burn Rate: $72.7K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: KE-W A1 120MM APFSDS-T CARTRIDGES

Place of Performance

Location: SAINT PETERSBURG, PINELLAS County, FLORIDA, 33716

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $51.0 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC. for work described as: KE-W A1 120MM APFSDS-T CARTRIDGES Key points: 1. Significant contract for advanced ammunition, crucial for armored vehicle capabilities. 2. Sole-source award to General Dynamics, a major defense contractor. 3. Potential for price escalation due to lack of competition. 4. Sector: Defense manufacturing, specifically ammunition.

Value Assessment

Rating: fair

The contract value of $50.99M for 701 days of performance suggests a per-unit cost of approximately $72,745. This is a high-value item, and without competitive bids, it's difficult to assess if this price is optimal.

Cost Per Unit: $72,745

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and may result in higher costs for taxpayers compared to a competitive process.

Taxpayer Impact: The lack of competition in this sole-source award raises concerns about potential overspending and the efficient use of taxpayer funds for critical defense materiel.

Public Impact

Ensures continued supply of essential ammunition for Army tanks and combat vehicles. Supports a key defense industrial base manufacturer, General Dynamics. Potential for increased costs due to sole-source nature, impacting overall defense budget allocation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price negotiation.
Long contract duration could lead to price volatility.
No indication of small business participation.

Positive Signals

Ensures availability of critical defense asset.
Supports established defense contractor with proven capabilities.

Sector Analysis

This contract falls within the defense manufacturing sector, specifically ammunition production. Spending benchmarks for similar high-caliber ammunition can vary widely based on technological sophistication and production volume, but $51M for this quantity indicates a substantial investment.

Small Business Impact

There is no indication of small business participation in this contract. As a sole-source award to a large prime contractor, opportunities for subcontracting to small businesses may be limited or not explicitly detailed in the award notice.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny to ensure fair pricing and prevent potential cost overruns. Robust oversight by the Department of the Army is crucial to validate the necessity and cost-effectiveness of this procurement.

Related Government Programs

Ammunition (except Small Arms) Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award
Lack of competition
Potential for price inflation
No small business participation noted
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $51.0 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC.. KE-W A1 120MM APFSDS-T CARTRIDGES

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, 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 $51.0 million.

What is the period of performance?

Start: 2025-05-16. End: 2027-04-17.

What is the justification for the sole-source award, and what steps are being taken to ensure fair pricing?

The justification for a sole-source award typically involves factors like unique capabilities, urgent need, or lack of viable alternatives. To ensure fair pricing, the agency should conduct thorough cost analysis, review historical pricing, and potentially negotiate specific price reduction targets or performance incentives within the contract.

What is the projected impact of this award on the Army's overall ammunition readiness and budget?

This award directly addresses the Army's need for 120mm APFSDS-T cartridges, bolstering readiness for armored units. The $51M expenditure represents a significant allocation within the defense budget for ammunition, potentially impacting funding for other procurement or modernization programs.

Are there any plans to introduce competition for future procurements of this ammunition type?

Future competition for this ammunition type would depend on market conditions, the expiration of any sole-source justifications, and strategic decisions by the Department of Defense. Exploring options for broadening the supplier base or encouraging new entrants could be considered to foster competition.

Industry Classification

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

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

Address: 100 CARILLON PKWY, SAINT PETERSBURG, FL, 33716

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $50,994,095

Exercised Options: $50,994,095

Current Obligation: $50,994,095

Subaward Activity

Number of Subawards: 12

Total Subaward Amount: $26,242,958

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W15QKN23D0035

IDV Type: IDC

Timeline