DoD Awards $21.4M for High Explosive Load Assembly, Facing Potential Price Concerns

Contract Overview

Contract Amount: $21,451,353 ($21.5M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 2024-08-20

End Date: 2028-05-31

Contract Duration: 1,380 days

Daily Burn Rate: $15.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: HIGH EXPLOSIVE LOAD ASSEMBLE ANY PACK

Plain-Language Summary

Department of Defense obligated $21.5 million to CANADIAN COMMERCIAL CORPORATION for work described as: HIGH EXPLOSIVE LOAD ASSEMBLE ANY PACK Key points: 1. Significant contract value for ammunition manufacturing. 2. Competition method is 'Full and Open', suggesting broad market access. 3. Potential risk identified in pricing assessment due to limited data. 4. Sector focus is Defense, specifically ammunition production.

Value Assessment

Rating: questionable

The total award value is $21.45 million. Without specific unit pricing or historical benchmarks for 'High Explosive Load Assemble Any Pack', it is difficult to definitively assess if this price is competitive. Further analysis of unit costs against similar procurements is needed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition', which is generally positive for price discovery. However, the specific award type is a 'Delivery Order', and the limited number of orders (2) may not fully leverage competitive pressures over the contract's life.

Taxpayer Impact: A full and open competition is intended to secure the best value for taxpayers. The effectiveness in achieving this depends on the actual pricing achieved and the level of competition realized.

Public Impact

Ensures supply of critical ammunition components for the Department of Defense. Supports defense industrial base capabilities in explosive ordnance manufacturing. Contract duration extends over several years, indicating sustained demand. Potential for cost overruns if pricing is not rigorously managed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Pricing assessment is questionable due to lack of detailed cost data.
Limited number of delivery orders may reduce competitive pressure.
Contract type is Firm Fixed Price, which transfers risk but requires accurate initial pricing.

Positive Signals

Awarded under Full and Open Competition.
Significant contract value indicates critical need.
Long contract duration suggests stable requirement.

Sector Analysis

This contract falls within the Defense sector, specifically the manufacturing of ammunition. Spending in this area is critical for national security. Benchmarks for similar high-explosive ordnance manufacturing contracts would be necessary for a more precise value assessment.

Small Business Impact

The data provided does not indicate whether small businesses were involved in this procurement. Further investigation would be needed to determine the extent of small business participation.

Oversight & Accountability

The contract is managed by the Department of the Army. Oversight will be crucial to ensure the quality of the high explosive load assembly and to monitor costs throughout the contract's duration, especially given the questionable pricing assessment.

Related Government Programs

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

Risk Flags

Pricing assessment is questionable.
Limited number of delivery orders.
Lack of detailed unit cost data.
Potential for cost overruns.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.5 million to CANADIAN COMMERCIAL CORPORATION. HIGH EXPLOSIVE LOAD ASSEMBLE ANY PACK

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 $21.5 million.

What is the period of performance?

Start: 2024-08-20. End: 2028-05-31.

What is the unit cost for the high explosive load assembly, and how does it compare to industry benchmarks or previous contracts for similar items?

The provided data does not include specific unit cost information for the high explosive load assembly. To perform a thorough value assessment, unit pricing data is essential. This would allow for comparison against historical data for similar ammunition components or against established industry cost benchmarks, thereby revealing potential overpricing or cost savings.

What are the specific risks associated with the 'High Explosive Load Assemble Any Pack' if pricing is not optimized?

If the pricing for the 'High Explosive Load Assemble Any Pack' is not optimized, the primary risk is financial waste for the Department of Defense and taxpayers. Suboptimal pricing could lead to budget overruns, diverting funds from other critical defense needs. Additionally, it might signal inefficiencies in the procurement process or a lack of robust cost analysis, potentially impacting future contract negotiations.

How effective is the 'Full and Open Competition' strategy likely to be in ensuring the best value for this specific ammunition procurement?

While 'Full and Open Competition' is generally the most effective strategy for achieving best value, its success here depends on the number and competitiveness of bids received. The limited number of delivery orders (2) and the specific nature of the item might restrict the number of capable bidders. Effective price discovery relies on robust competition, which needs to be monitored throughout the contract's life.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

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: $21,451,353

Exercised Options: $21,451,353

Current Obligation: $21,451,353

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52P1J22D0032

IDV Type: IDC

Timeline