DoD Awards BAE Systems $51.4M for HIMARS Components, Lacking Competition
Contract Overview
Contract Amount: $51,415,399 ($51.4M)
Contractor: BAE Systems Tactical Vehicle Systems LP
Awarding Agency: Department of Defense
Start Date: 2009-08-31
End Date: 2011-12-31
Contract Duration: 852 days
Daily Burn Rate: $60.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: HIMARS PROCUREMENT OF 64 ICP CAPS,65 APPLIQUE KITS, 59 BATTERY DISCONNECTS, 5 SETS OF SPARES
Place of Performance
Location: SEALY, COLORADO County, TEXAS, 77474
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $51.4 million to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP for work described as: HIMARS PROCUREMENT OF 64 ICP CAPS,65 APPLIQUE KITS, 59 BATTERY DISCONNECTS, 5 SETS OF SPARES Key points: 1. Significant award for critical HIMARS components, including ICP CAPS and applique kits. 2. Sole-source procurement raises concerns about price discovery and potential overpayment. 3. Contract awarded to BAE Systems, a major defense contractor. 4. Spending occurred over a 2.5-year period, suggesting a steady supply chain need.
Value Assessment
Rating: questionable
The contract's firm fixed price structure aims for cost certainty. However, without competition, it's difficult to benchmark pricing against market alternatives or identify potential savings.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as competitive pressures are absent.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying a premium for these HIMARS components.
Public Impact
Ensures continued operational readiness for HIMARS, a key battlefield asset. Supports BAE Systems' manufacturing capabilities and associated workforce. Procurement of specialized kits and spares indicates ongoing maintenance and upgrade requirements.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Sole-source award
- Potential for inflated pricing
Positive Signals
- Firm fixed price contract
- Supports critical defense asset
Sector Analysis
This procurement falls within the Military Armored Vehicle, Tank, and Tank Component Manufacturing sector. Spending benchmarks in this specialized area are often influenced by defense budgets and specific program requirements, making direct comparisons challenging without competitive data.
Small Business Impact
The contract was awarded to BAE Systems Tactical Vehicle Systems LP, a large business. There is no indication of small business participation in this specific sole-source award.
Oversight & Accountability
The award was managed by the Department of the Army. Oversight effectiveness is difficult to assess without knowing the justification for the sole-source award and the negotiation process.
Related Government Programs
- Military Armored Vehicle, Tank, and Tank Component Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for above-market pricing due to lack of competition.
- Lack of transparency regarding justification for sole-source.
- No clear indication of small business participation.
Tags
military-armored-vehicle-tank-and-tank-c, department-of-defense, tx, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $51.4 million to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP. HIMARS PROCUREMENT OF 64 ICP CAPS,65 APPLIQUE KITS, 59 BATTERY DISCONNECTS, 5 SETS OF SPARES
Who is the contractor on this award?
The obligated recipient is BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $51.4 million.
What is the period of performance?
Start: 2009-08-31. End: 2011-12-31.
What was the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?
The provided data does not specify the justification for the sole-source award. Typically, sole-source contracts are justified by factors such as unique capabilities, urgent need, or lack of viable alternatives. Further investigation into the contract file would be required to determine the specific rationale used by the Department of the Army in this instance.
How does the unit cost of these HIMARS components compare to similar procurements, if any?
Without competitive bidding or access to pricing data from alternative suppliers, it is impossible to establish a reliable benchmark for the unit cost of these HIMARS components. The firm fixed price nature of the contract provides cost certainty for the government but does not inherently guarantee value for money in the absence of competition.
What is the long-term strategic impact of relying on sole-source procurement for critical defense components like these?
Long-term reliance on sole-source procurement can stifle innovation, reduce competition, and potentially lead to higher costs and supply chain vulnerabilities. It may also limit the government's ability to leverage market dynamics for better pricing and technological advancements, impacting overall defense readiness and budget efficiency.
Industry Classification
NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W31P4Q09R0216
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: BAE Systems PLC (UEI: 217304393)
Address: 5000 INTERSTATE HWY 10 W, SEALY, TX, 10
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $51,415,399
Exercised Options: $51,415,399
Current Obligation: $51,415,399
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2009-08-31
Current End Date: 2011-12-31
Potential End Date: 2011-12-31 00:00:00
Last Modified: 2011-12-08
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