DoD awards $16M for NGATS spare parts, raising questions about value and competition

Contract Overview

Contract Amount: $15,986,054 ($16.0M)

Contractor: Total Technology, Inc

Awarding Agency: Department of Defense

Start Date: 2025-09-25

End Date: 2027-09-28

Contract Duration: 733 days

Daily Burn Rate: $21.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: DELIVERY ORDER 05 FOR NGATS SPARE PARTS

Place of Performance

Location: CHERRY HILL, CAMDEN County, NEW JERSEY, 08034

State: New Jersey Government Spending

Plain-Language Summary

Department of Defense obligated $16.0 million to TOTAL TECHNOLOGY, INC for work described as: DELIVERY ORDER 05 FOR NGATS SPARE PARTS Key points: 1. Analysis indicates potential for overpayment given the firm fixed-price contract type and limited competition. 2. The contract's value proposition requires closer examination against industry benchmarks for similar spare parts. 3. Risk indicators include a lack of robust competition and a long performance period. 4. Performance context is limited, with no clear metrics provided for assessing the effectiveness of spare parts delivery. 5. This contract falls within the broader Defense sector, specifically supporting Army aviation readiness. 6. The reliance on a single awardee for critical spare parts may pose supply chain risks.

Value Assessment

Rating: questionable

The firm fixed-price contract for spare parts at $15.98 million warrants scrutiny. Without detailed cost breakdowns or comparisons to similar procurements, it's difficult to definitively assess value for money. The absence of competitive bidding, as indicated by the contract type, suggests potential for inflated pricing. Benchmarking against industry standards for electrical testing and measuring instrument parts would be necessary to determine if the price is reasonable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which suggests a limited competition scenario. While not a sole-source award, the exclusion of certain sources implies that the bidding pool was restricted. The number of bidders is not explicitly stated, but the nature of the award suggests fewer than ideal competition, potentially impacting price discovery and leading to less favorable terms for the government.

Taxpayer Impact: Limited competition can result in higher prices for taxpayers as the government may not benefit from the full range of competitive pressures that drive down costs in a truly open market.

Public Impact

The Department of the Army benefits from the acquisition of essential spare parts for its NGATS (Next Generation Aviation Training System) program. This contract ensures the continued operational readiness of aviation training platforms. The geographic impact is primarily within New Jersey, where the contractor is located, and wherever the spare parts are ultimately deployed. Workforce implications are likely minimal, as this is a procurement of goods rather than services requiring significant labor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price gouging due to limited competition.
Supply chain vulnerability if the sole awardee faces production issues.
Lack of transparency in the procurement process due to source exclusion.
Long contract duration increases exposure to market fluctuations.
Difficulty in verifying the necessity and quantity of spare parts procured.

Positive Signals

Contract awarded to a single entity, potentially streamlining logistics.
Firm fixed-price structure provides cost certainty for the government.
Delivery order mechanism allows for phased procurement of parts.
Contract supports critical defense training infrastructure.

Sector Analysis

This contract falls within the broader Defense Industrial Base sector, specifically focusing on the manufacturing and supply of specialized electronic components and spare parts. The market for such components is often characterized by high technical barriers to entry and stringent quality requirements. Comparable spending benchmarks would involve analyzing other Department of Defense contracts for similar electronic testing and measurement instrument parts, as well as general aviation spare parts procurements.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside requirement. The primary contractor, TOTAL TECHNOLOGY, INC, is not explicitly identified as a small business. The impact on the small business ecosystem is neutral in terms of direct set-aside opportunities.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial management oversight mechanisms. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified goods at an agreed-upon price. Transparency could be enhanced through public disclosure of detailed pricing and performance metrics. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Spare Parts Procurement
Army Aviation Training Systems
Instrument Manufacturing Contracts
Electrical Testing Equipment Supply
Defense Logistics Agency Contracts

Risk Flags

Limited competition raises concerns about price reasonableness.
Potential for supply chain disruption if contractor fails to deliver.
Lack of detailed performance metrics makes outcome assessment difficult.
Contract duration extends potential exposure to risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.0 million to TOTAL TECHNOLOGY, INC. DELIVERY ORDER 05 FOR NGATS SPARE PARTS

Who is the contractor on this award?

The obligated recipient is TOTAL TECHNOLOGY, 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 $16.0 million.

What is the period of performance?

Start: 2025-09-25. End: 2027-09-28.

What is the track record of TOTAL TECHNOLOGY, INC. in fulfilling defense contracts, particularly for spare parts?

A comprehensive review of TOTAL TECHNOLOGY, INC.'s contract history with the Department of Defense is necessary to assess their reliability and performance. Specifically, examining past delivery orders for similar spare parts, on-time delivery rates, quality of goods provided, and any history of contract disputes or terminations would offer valuable insights. Without this specific data, it is difficult to gauge their capability to meet the demands of this $15.98 million contract effectively. A pattern of successful past performance would mitigate some of the concerns associated with limited competition.

How does the $15.98 million price compare to market rates for similar NGATS spare parts?

Benchmarking this $15.98 million contract against market rates for comparable NGATS spare parts is crucial for assessing value for money. This would involve researching prices for identical or functionally equivalent parts from other suppliers, analyzing historical pricing trends for these components, and consulting industry cost estimation guides. Given the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award type, there's a risk that the price may not reflect the most competitive market rate. A detailed cost analysis comparing unit prices, bulk discounts, and associated logistical costs is needed.

What are the specific risks associated with the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' procurement method for this contract?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' method, while allowing for some competition, inherently carries risks. It suggests that certain potential bidders were deliberately excluded, potentially limiting the innovation and cost-saving opportunities that a truly open competition might yield. This exclusion could be based on specific technical requirements, past performance issues with certain vendors, or other justifications. The primary risk is that the government may not have accessed the most competitive offers available, potentially leading to higher costs or less optimal solutions for taxpayers. It also raises questions about the transparency and fairness of the procurement process.

What is the expected impact of this contract on the operational readiness of Army aviation training platforms?

This contract is directly intended to enhance the operational readiness of Army aviation training platforms by ensuring the availability of critical spare parts for the NGATS program. The timely delivery of these parts, as stipulated by the contract's performance period (ending September 28, 2027), is essential for minimizing downtime and maintaining the effectiveness of training exercises. The $15.98 million investment signifies the importance placed on sustaining these platforms. However, the actual impact on readiness will depend on the contractor's ability to deliver high-quality parts consistently and on schedule, as well as the overall demand for these specific components.

How does current spending on NGATS spare parts compare to historical spending patterns for similar aviation training equipment?

To assess historical spending patterns, one would need to analyze previous contracts for NGATS spare parts or comparable aviation training equipment. This involves examining the total dollar amounts awarded over time, the frequency of procurements, the types of contracts used (e.g., fixed-price vs. cost-plus), and the number of bidders in past competitions. Comparing the current $15.98 million award to these historical data points can reveal trends in pricing, demand, and the evolution of the supply chain. Significant deviations from historical norms, particularly in price per unit or total contract value, would warrant further investigation.

Are there any specific performance metrics or Key Performance Indicators (KPIs) associated with this delivery order to measure success?

The provided data does not explicitly detail specific performance metrics or Key Performance Indicators (KPIs) for this delivery order. However, standard government contracting practices often include requirements for on-time delivery, quality acceptance rates, and adherence to technical specifications. For a spare parts contract, KPIs might include metrics such as 'On-Time Delivery Rate,' 'Defect Rate,' 'Order Fill Rate,' and 'Compliance with Technical Specifications.' The firm fixed-price nature implies that meeting these implicit or explicit performance standards is crucial for the contractor to receive full payment without modification.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 950 N KINGS HWY, SUITE 105, CHERRY HILL, NJ, 08034

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, Minority Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $15,986,054

Exercised Options: $15,986,054

Current Obligation: $15,986,054

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W15QKN22D0034

IDV Type: IDC

Timeline