Army awards $13.3M contract for 120mm practice cartridges, with delivery through October 2030

Contract Overview

Contract Amount: $13,286,719 ($13.3M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 2025-09-08

End Date: 2030-10-31

Contract Duration: 1,879 days

Daily Burn Rate: $7.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TO MANUFACTURE, PRODUCE, AND DELIVER 120MM M931 FULL RANGE PRACTICE CARTRIDGES, INCLUDING INITIAL FIRST ARTICLE TEST (FAT).

Plain-Language Summary

Department of Defense obligated $13.3 million to CANADIAN COMMERCIAL CORPORATION for work described as: TO MANUFACTURE, PRODUCE, AND DELIVER 120MM M931 FULL RANGE PRACTICE CARTRIDGES, INCLUDING INITIAL FIRST ARTICLE TEST (FAT). Key points: 1. Contract aims to ensure a steady supply of essential training ammunition. 2. Competition was conducted after excluding specific sources, warranting scrutiny of the process. 3. The firm-fixed-price structure shifts cost risk to the contractor. 4. Delivery spans over five years, indicating a long-term need. 5. The North American Industry Classification System (NAICS) code 332993 covers ammunition manufacturing. 6. The contract value is modest relative to broader defense procurement, but critical for training readiness.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific per-unit cost data or comparisons to similar recent procurements for 120mm practice cartridges. The total award amount of $13.3 million for an estimated 120mm M931 full range practice cartridges over a five-year period suggests a need for consistent training support. However, the absence of detailed cost breakdowns or direct comparisons makes a definitive value-for-money assessment difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This indicates that while the competition was intended to be broad, certain sources were excluded from the outset. The specific reasons for exclusion are not detailed, which limits the ability to fully assess the breadth and effectiveness of the competition. The number of bidders is not specified, making it difficult to determine if the exclusion of sources significantly impacted the competitive landscape and potentially influenced pricing.

Taxpayer Impact: The exclusion of sources, even if justified, may limit the number of potential offerors, potentially leading to less aggressive pricing than a truly unrestricted full and open competition. Taxpayers benefit from competition, but the specific parameters here warrant further understanding to ensure optimal value.

Public Impact

The primary beneficiaries are U.S. Army personnel who require realistic training ammunition for operating 120mm cannons. The contract ensures the delivery of 120mm M931 full range practice cartridges, vital for combat readiness. Geographic impact is primarily on training ranges where these rounds will be utilized. Workforce implications are within the ammunition manufacturing sector, potentially supporting jobs at the awarded contractor's facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' in the competition method requires further investigation to ensure no viable, competitive sources were unfairly barred.
Lack of detailed cost breakdowns or per-unit pricing makes it difficult to assess if the government is receiving optimal value.
The long contract duration (over 5 years) necessitates ongoing monitoring to ensure performance remains aligned with expectations and market conditions.

Positive Signals

The contract utilizes a firm-fixed-price type, which transfers cost overrun risks to the contractor.
The award is for practice cartridges, directly supporting essential military training and readiness.
The contract includes provisions for initial First Article Testing (FAT), ensuring product quality before full production.

Sector Analysis

The ammunition manufacturing sector is a critical component of the defense industrial base. This contract falls under NAICS code 332993, 'Ammunition (except Small Arms) Manufacturing.' The market for military-grade ammunition is often characterized by long-term government contracts, specialized production capabilities, and stringent quality control requirements. While specific market size data for 120mm practice cartridges is not readily available, the overall defense ammunition market is substantial, with significant government spending allocated annually to ensure adequate supply for training and operational needs.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false) and the contractor is not a small business (sb=false). Therefore, there are no direct subcontracting implications for small businesses mandated by this specific award. The primary impact on the small business ecosystem would be indirect, through the potential for the prime contractor to engage small businesses as suppliers or subcontractors if it aligns with their supply chain strategy.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of the Army contracting and program management offices. The firm-fixed-price nature of the contract shifts some financial risk to the contractor, but performance monitoring, quality assurance, and delivery schedule adherence will be key oversight areas. Transparency is facilitated by the public nature of contract awards, but detailed internal oversight mechanisms and Inspector General jurisdiction would depend on specific Army regulations and any identified performance issues.

Related Government Programs

Department of Defense Ammunition Procurement
Army Training and Doctrine Command (TRADOC) Support
Military Vehicle Ammunition
Defense Logistics Agency (DLA) Ammunition Stockpile Management

Risk Flags

Competition Method: 'Exclusion of Sources' requires further justification.
Cost Transparency: Lack of detailed unit cost data hinders value assessment.
Contractor Performance: Long-term contract requires diligent performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.3 million to CANADIAN COMMERCIAL CORPORATION. TO MANUFACTURE, PRODUCE, AND DELIVER 120MM M931 FULL RANGE PRACTICE CARTRIDGES, INCLUDING INITIAL FIRST ARTICLE TEST (FAT).

Who is the contractor on this award?

The obligated recipient is CANADIAN COMMERCIAL 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 $13.3 million.

What is the period of performance?

Start: 2025-09-08. End: 2030-10-31.

What is the specific unit cost for the 120mm M931 practice cartridges under this contract, and how does it compare to historical or benchmark pricing?

The provided data does not include the specific unit cost for the 120mm M931 practice cartridges. The total award is $13,286,718.96 for an unspecified quantity of cartridges to be delivered between the award date and October 31, 2030. To determine the unit cost, the total number of cartridges procured would be needed. Without this quantity, a direct comparison to historical or benchmark pricing is impossible. Typically, unit costs for such specialized munitions can vary significantly based on production volume, material costs, manufacturing complexity, and the specific contract terms. A firm-fixed-price contract aims to establish a set price, but understanding the underlying cost drivers and comparing them to similar procurements or industry standards is crucial for assessing value for money. Further analysis would require access to the detailed contract line item numbers (CLINs) or the total quantity awarded.

What were the specific reasons for excluding certain sources in the 'Full and Open Competition After Exclusion of Sources' process?

The provided data summary states the contract type as 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' but does not detail the specific reasons for this exclusion. This procurement method implies that while the competition was intended to be open, certain potential offerors were deemed ineligible to bid. Common justifications for excluding sources can include national security concerns, proprietary technology restrictions, inability to meet stringent technical specifications, or prior performance issues. Without explicit documentation or justification from the Department of the Army regarding which sources were excluded and why, it is difficult to fully assess the impact on competition and potential price discovery. This lack of transparency regarding exclusions warrants further inquiry to ensure fair and effective competition.

What is the track record of the Canadian Commercial Corporation (CCC) in supplying defense munitions to the U.S. Department of Defense?

The Canadian Commercial Corporation (CCC) is a Canadian Crown corporation that facilitates international trade for Canadian companies. While CCC itself is not a manufacturer, it acts as a government-to-government contracting entity. Its track record in supplying defense materiel to the U.S. Department of Defense (DoD) is generally positive, often involving complex, high-value procurements where Canadian industry possesses unique capabilities or competitive advantages. CCC's role is to manage the contractual relationship, ensuring compliance with U.S. and Canadian regulations, quality standards, and delivery schedules. For this specific contract, CCC would be facilitating the supply of ammunition manufactured by a Canadian entity. Assessing CCC's track record involves reviewing its history of successful contract execution, adherence to terms, and overall reliability in delivering defense goods and services to international partners, including the U.S. DoD.

How does the duration of this contract (delivery through October 2030) align with typical procurement cycles for training ammunition?

The duration of this contract, with deliveries extending through October 2030, represents a significant period, approximately five years from the estimated award date. Typical procurement cycles for training ammunition can vary widely depending on factors such as anticipated training tempo, inventory levels, production lead times, and the strategic importance of the munition. Longer-term contracts like this one often indicate a sustained, predictable demand for the specific type of ammunition and may be used to ensure supply chain stability, encourage contractor investment in production capacity, or secure favorable pricing through long-term commitments. For training munitions, which are consumed in large quantities, such extended durations are not uncommon, especially when linked to multi-year training plans or modernization efforts for weapon systems that utilize these rounds.

What are the potential risks associated with a firm-fixed-price contract for ammunition manufacturing, particularly concerning quality and delivery?

A firm-fixed-price (FFP) contract places the primary responsibility for cost control and delivery on the contractor. For ammunition manufacturing, potential risks include the contractor cutting corners on quality control to maintain profitability if unforeseen cost increases arise, or facing delays if production challenges emerge. While the FFP structure is generally favored for its cost certainty for the buyer, the government must maintain robust oversight to ensure the contractor meets all quality specifications and delivery schedules. The inclusion of First Article Testing (FAT) is a critical mitigation step, ensuring the initial production run meets standards before mass production. However, ongoing quality assurance and performance monitoring throughout the contract's life are essential to mitigate risks associated with maintaining consistent quality and timely delivery over the multi-year period.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 350 ALBERT ST SUITE 700, OTTAWA

Business Categories: Category Business, Foreign Government, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $13,286,719

Exercised Options: $13,286,719

Current Obligation: $13,286,719

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W15QKN23D0023

IDV Type: IDC

Timeline