Army awards $357M contract for guided missile and space vehicle manufacturing to Dynetics, Inc

Contract Overview

Contract Amount: $356,744,352 ($356.7M)

Contractor: Dynetics, Inc.

Awarding Agency: Department of Defense

Start Date: 2025-07-30

End Date: 2028-02-29

Contract Duration: 944 days

Daily Burn Rate: $377.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: FY25 BUY

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35898

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $356.7 million to DYNETICS, INC. for work described as: FY25 BUY Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Long contract duration of 944 days suggests a significant, ongoing need. 3. Firm Fixed Price contract type aims to control costs for the government. 4. The award is a delivery order under a previously established contract. 5. Focus on guided missile and space vehicle manufacturing indicates a critical defense capability. 6. Contractor is based in Alabama, potentially impacting local economic development.

Value Assessment

Rating: fair

The contract value of $356.7 million over approximately 2.5 years requires careful benchmarking against similar defense manufacturing contracts. Without specific details on the scope of work, it's challenging to assess value for money. The firm fixed-price structure is a positive indicator for cost control, but the lack of competition raises concerns about whether the government secured the best possible price. Further analysis would involve comparing unit costs for similar components or services if available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Dynetics, Inc., was considered. This approach bypasses the competitive bidding process, which typically leads to a wider range of proposals and potentially lower prices due to market pressures. While sole-source awards can be justified for specialized capabilities or urgent needs, they inherently reduce opportunities for price discovery and may result in higher costs for the government compared to a fully competed contract.

Taxpayer Impact: Sole-source awards mean taxpayers may not benefit from the cost savings that can arise from robust competition among multiple vendors.

Public Impact

The primary beneficiaries are the Department of the Army and potentially other branches of the Department of Defense requiring guided missile and space vehicle components. The contract will deliver essential manufacturing services for critical defense systems. The geographic impact is concentrated in Alabama, where Dynetics, Inc. is located, potentially creating or sustaining jobs in that region. Workforce implications include the need for skilled labor in advanced manufacturing, engineering, and quality control within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source award limits transparency in pricing negotiations.
Long-term contract duration could lock in potentially suboptimal terms if market conditions change.

Positive Signals

Firm Fixed Price contract type provides cost certainty.
Award to a single, potentially specialized, contractor may ensure access to critical capabilities.
Delivery order structure suggests it's part of a larger, established framework.

Sector Analysis

This contract falls within the defense manufacturing sector, specifically focusing on guided missile and space vehicle production. This is a highly specialized area within the broader aerospace and defense industry, characterized by significant R&D investment, stringent quality requirements, and long production cycles. The market is often dominated by a few key players due to high barriers to entry. Comparable spending benchmarks would typically be found within other major defense procurement programs for similar weapon systems or components.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a sole-source award to Dynetics, Inc., there is no explicit subcontracting plan for small businesses detailed in this information. This means opportunities for small business participation may be limited unless Dynetics proactively includes them in its supply chain. The absence of a set-aside or specific subcontracting goals could reduce the direct economic benefit to the small business ecosystem within this specific contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a delivery order under a larger contract, existing oversight mechanisms for that parent contract would likely apply. Transparency is limited due to the sole-source nature. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected. Accountability rests with the contracting officer and program managers to ensure performance and adherence to contract terms.

Related Government Programs

Guided Missile Manufacturing
Space Vehicle Manufacturing
Defense Procurement
Aerospace Manufacturing
Department of Defense Contracts
Firm Fixed Price Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $356.7 million to DYNETICS, INC.. FY25 BUY

Who is the contractor on this award?

The obligated recipient is DYNETICS, 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 $356.7 million.

What is the period of performance?

Start: 2025-07-30. End: 2028-02-29.

What is the specific nature of the guided missile and space vehicle manufacturing services being procured under this contract?

The provided data indicates the North American Industry Classification System (NAICS) code is 336414, which corresponds to 'Guided Missile and Space Vehicle Manufacturing'. This suggests the contract is for the production, assembly, or manufacturing of components for guided missiles and space vehicles. Without further details, it's difficult to ascertain the exact scope, which could range from raw material processing and component fabrication to final assembly and testing of these complex defense systems. The specific end-use systems or platforms are not identified in the basic data.

How does the $356.7 million contract value compare to historical spending on similar guided missile and space vehicle manufacturing contracts by the Department of the Army?

Benchmarking this $356.7 million contract requires access to historical spending data for comparable guided missile and space vehicle manufacturing efforts by the Department of the Army. Typically, such analysis would involve identifying contracts with similar NAICS codes (336414) and scope over the past several fiscal years. Factors like contract duration (944 days), type (Firm Fixed Price), and specific deliverables would be crucial for a meaningful comparison. A higher or lower value relative to historical averages, adjusted for inflation and scope, could indicate shifts in pricing, demand, or market conditions. The sole-source nature of this award also complicates direct value comparisons with competitively bid contracts.

What are the primary risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risk of a sole-source award for a $356.7 million contract is the potential for paying a non-competitive price. Without the pressure of multiple bidders vying for the contract, the government may not achieve the most favorable pricing. This can lead to inefficient use of taxpayer funds. Additionally, sole-source awards can reduce transparency in the procurement process and may signal a lack of available alternative suppliers or a reliance on a single entity for critical capabilities, which poses a supply chain risk. There's also a risk that the contractor may have less incentive to innovate or improve efficiency compared to a competitive environment.

What is Dynetics, Inc.'s track record in fulfilling Department of Defense contracts, particularly in missile and space vehicle manufacturing?

Dynetics, Inc. has a known track record within the Department of Defense, often involved in advanced technology development, engineering services, and manufacturing, particularly in areas related to aerospace and defense. While specific details on their performance for this exact type of guided missile and space vehicle manufacturing contract require deeper database access, the company is generally recognized for its capabilities in these domains. Assessing their past performance would involve reviewing contract histories, past performance evaluations (if publicly available), and any history of contract disputes or awards for similar work. Their presence in Alabama also suggests a history of engagement with regional defense initiatives.

Given the contract's focus on guided missile and space vehicle manufacturing, what are the potential implications for national security and defense readiness?

This contract directly supports national security and defense readiness by ensuring the continued production or manufacturing of critical components for guided missiles and space vehicles. These systems are vital for maintaining military superiority, deterrence, and responding to various threats. A reliable supply chain for such advanced defense assets is paramount. The award to Dynetics, Inc. suggests the Army has confidence in their ability to deliver these essential capabilities. Any disruption or failure in this manufacturing process could have significant negative implications for the deployment and effectiveness of key defense platforms.

What is the historical spending trend for guided missile and space vehicle manufacturing (NAICS 336414) by the federal government over the last five fiscal years?

Analyzing the historical federal spending trend for guided missile and space vehicle manufacturing (NAICS 336414) over the last five fiscal years would reveal the overall investment in this sector. This typically involves aggregating contract data from agencies like the Department of Defense, NASA, and others that procure such capabilities. A rising trend might indicate increased demand for these systems due to geopolitical factors or modernization efforts, while a declining trend could suggest program completions or shifts in defense priorities. Understanding this broader context helps evaluate whether the current $356.7 million award represents a typical, increased, or decreased level of investment for this specific manufacturing domain.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing

Product/Service Code: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1002 EXPLORER BOULEVARD, HUNTSVILLE, AL, 35806

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: $493,463,407

Exercised Options: $493,463,407

Current Obligation: $356,744,352

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W31P4Q25D0003

IDV Type: IDC

Timeline