DoD awards $26M for M16A4 rifles, a sole-source contract to FN America LLC
Contract Overview
Contract Amount: $26,065,586 ($26.1M)
Contractor: FN America LLC
Awarding Agency: Department of Defense
Start Date: 2007-04-12
End Date: 2008-09-30
Contract Duration: 537 days
Daily Burn Rate: $48.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: M16A4 FMS/USMC REQUIREMENT
Place of Performance
Location: COLUMBIA, RICHLAND County, SOUTH CAROLINA, 29229
Plain-Language Summary
Department of Defense obligated $26.1 million to FN AMERICA LLC for work described as: M16A4 FMS/USMC REQUIREMENT Key points: 1. Contract awarded for M16A4 rifles to FN America LLC. 2. Significant value of $26M for small arms procurement. 3. Sole-source award raises questions about competition and price discovery. 4. Procurement falls under the Small Arms, Ordnance, and Ordnance Accessories Manufacturing sector.
Value Assessment
Rating: questionable
The contract value of $26M for M16A4 rifles is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market rates for similar firearms.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to FN America LLC. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for these M16A4 rifles.
Public Impact
Military readiness potentially impacted by specific firearm procurement. Taxpayer funds allocated for defense equipment. Sole-source nature of the award may limit industry innovation and competition.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
Positive Signals
- Specific requirement for M16A4 rifles met
- Contract awarded to established manufacturer
Sector Analysis
This procurement falls within the 'Small Arms, Ordnance, and Ordnance Accessories Manufacturing' sector. Spending benchmarks in this area can vary widely based on specific weapon systems and quantities.
Small Business Impact
The data indicates this contract was not awarded to a small business. Further analysis would be needed to determine if small businesses were considered or had the capability to fulfill this requirement.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure fair pricing and justification for the lack of competition. Oversight is crucial to confirm the necessity and value of this procurement.
Related Government Programs
- Small Arms, Ordnance, and Ordnance Accessories Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award
- Lack of competitive bidding
- Potential for inflated pricing
- Limited transparency in price discovery
- No small business participation indicated
Tags
small-arms-ordnance-and-ordnance-accesso, department-of-defense, sc, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $26.1 million to FN AMERICA LLC. M16A4 FMS/USMC REQUIREMENT
Who is the contractor on this award?
The obligated recipient is FN AMERICA LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $26.1 million.
What is the period of performance?
Start: 2007-04-12. End: 2008-09-30.
What is the justification for awarding this contract on a sole-source basis?
The provided data does not specify the justification for the sole-source award. Typically, sole-source contracts are used when only one responsible source can provide the required supplies or services, or in cases of urgent need. A thorough review would be required to validate this justification and ensure it aligns with federal procurement regulations.
How does the unit cost of these M16A4 rifles compare to similar government or commercial purchases?
Without a competitive bidding process, establishing a precise unit cost benchmark is challenging. The contract's firm fixed price suggests a negotiated rate. To assess value, one would need to compare this negotiated price against historical data for M16A4 rifles or comparable assault rifle systems procured competitively by the government or available on the commercial market.
What is the long-term strategic impact of procuring specific firearms like the M16A4 through sole-source contracts?
Sole-source contracts can limit the government's ability to leverage competition for better pricing and innovation. Over time, this can lead to higher sustainment costs and potentially stifle the development of next-generation small arms if key manufacturers are not incentivized through competitive opportunities. It also raises concerns about supply chain resilience if reliance on a single source increases.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Small Arms, Ordnance, and Ordnance Accessories Manufacturing
Product/Service Code: WEAPONS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W52H0907R0221
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Societ Herstalienne Pour LA Finance L'industrielle ET LE C (UEI: 370005936)
Address: 797 OLD CLEMSON RD, COLUMBIA, SC, 90
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $26,065,586
Exercised Options: $26,065,586
Current Obligation: $26,065,586
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2007-04-12
Current End Date: 2008-09-30
Potential End Date: 2008-09-30 00:00:00
Last Modified: 2010-04-24
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