DoD awards $105M for ammunition manufacturing, with General Dynamics securing the contract

Contract Overview

Contract Amount: $105,184,577 ($105.2M)

Contractor: General Dynamics Ordnance and Tactical Systems Inc

Awarding Agency: Department of Defense

Start Date: 2007-08-03

End Date: 2016-04-26

Contract Duration: 3,189 days

Daily Burn Rate: $33.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: BASIC AWARD - M107 MPTS

Place of Performance

Location: SCRANTON, LACKAWANNA County, PENNSYLVANIA, 18505

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $105.2 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS INC for work described as: BASIC AWARD - M107 MPTS Key points: 1. Contract awarded for ammunition manufacturing, indicating a sustained need for these munitions. 2. The contract duration of 3189 days suggests a long-term requirement and potential for stable production. 3. Firm Fixed Price contract type aims to control costs and provide predictability for the government. 4. The award was made under full and open competition after exclusion of sources, implying a competitive process with specific justifications. 5. The North American Industry Classification System (NAICS) code 332993 points to the specific manufacturing sector for ammunition. 6. The contract's value of over $105 million signifies a substantial investment in defense materiel.

Value Assessment

Rating: fair

The contract value of $105,184,576.82 for ammunition manufacturing appears substantial. Benchmarking this against similar contracts for M107 MPTS would be necessary for a precise value-for-money assessment. However, the firm fixed-price structure suggests an effort to manage costs. Without specific per-unit cost data or comparison to market rates for this type of munition, a definitive assessment of pricing efficiency is challenging. The long duration of the contract could indicate a stable, albeit potentially high, unit cost over time.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while competition was sought, certain sources were excluded, likely due to specific technical requirements, security concerns, or other justifications outlined in the contract award documentation. The number of bidders is not specified, but the 'exclusion of sources' suggests a potentially narrower competitive field than a purely 'full and open' competition.

Taxpayer Impact: The exclusion of sources may limit the potential for the lowest possible price, as the pool of competing firms was restricted. Taxpayers may not benefit from the full price discovery that a completely open competition could provide.

Public Impact

The Department of the Army benefits from a secured supply of M107 MPTS ammunition. This contract ensures the availability of critical munitions for military operations. The manufacturing activities will likely occur within Pennsylvania, supporting the state's industrial base. The contract supports jobs within the defense manufacturing sector, particularly in ammunition production.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition due to exclusion of sources could lead to higher prices.
Long contract duration may mask inefficiencies if not closely monitored.
Reliance on a single contractor for a critical munition type poses supply chain risk.

Positive Signals

Firm Fixed Price contract type provides cost certainty.
Award to a known entity (General Dynamics) suggests a potentially reliable supplier.
Sustained award indicates a consistent need and potential for economies of scale in production.

Sector Analysis

This contract falls within the defense manufacturing sector, specifically focusing on ammunition production. The market for military munitions is characterized by government procurement, often involving long-term contracts to ensure supply chain stability and readiness. General Dynamics Ordnance and Tactical Systems is a significant player in this industry. Comparable spending benchmarks would involve analyzing other large-scale ammunition procurement contracts by the DoD or allied nations.

Small Business Impact

The contract indicates that small business participation was not a primary set-aside consideration, as 'sb' is false. There is no explicit mention of subcontracting goals for small businesses within the provided data. This suggests that the primary focus was on fulfilling the large-scale ammunition requirement, and the impact on the small business ecosystem may be indirect, potentially through the supply chain of the prime contractor.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management offices. Accountability measures are inherent in the firm fixed-price structure, which places the cost risk on the contractor. Transparency is generally maintained through contract award databases, though specific performance metrics and detailed cost breakdowns may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Ammunition Procurement
Army Weapons Systems Procurement
Ordnance Manufacturing Contracts
General Dynamics Defense Contracts

Risk Flags

Limited competition may impact price.
Supply chain concentration risk.
Long-term contract requires ongoing performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $105.2 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS INC. BASIC AWARD - M107 MPTS

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS 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 $105.2 million.

What is the period of performance?

Start: 2007-08-03. End: 2016-04-26.

What is the historical spending trend for M107 MPTS ammunition by the Department of the Army?

Analyzing historical spending for M107 MPTS ammunition by the Department of the Army requires access to detailed procurement databases beyond the provided award data. However, the duration and value of this specific contract (over 9 years and $105 million) suggest a consistent and significant requirement for this munition type. Trends would likely reflect operational tempo, inventory management strategies, and modernization programs. A comprehensive review would involve examining annual procurement requests, contract modifications, and spending patterns over the last decade or more to identify any fluctuations or sustained levels of investment in this specific ammunition category.

How does the unit cost of this M107 MPTS contract compare to similar contracts awarded in the past or to other branches of the military?

Direct comparison of the unit cost for this M107 MPTS contract is challenging without specific unit pricing data and a clear definition of 'unit' (e.g., per round, per lot). The provided data only gives the total award value. To perform a meaningful comparison, one would need to identify the total quantity of ammunition procured under this $105 million contract and then divide the total cost by that quantity. Subsequently, this calculated unit cost would need to be benchmarked against publicly available data for similar ammunition procurements by the Army, other military branches (like the Navy or Air Force), or even international allies, considering factors like inflation, contract type, and specific technical requirements that might influence pricing.

What specific justifications were provided for the exclusion of sources in this 'Full and Open Competition After Exclusion of Sources' award?

The justification for excluding certain sources in a 'Full and Open Competition After Exclusion of Sources' award typically stems from specific requirements that only a limited number of offerors can meet. Common reasons include unique technical capabilities, proprietary technology, urgent need where only specific contractors can deliver in time, or requirements for specialized facilities or security clearances. For this M107 MPTS ammunition contract, the exclusion might relate to specific manufacturing processes, material sourcing, quality assurance protocols, or existing production lines already tooled for this particular munition. Detailed justifications are usually documented in the contract award file and may be subject to Freedom of Information Act (FOIA) requests, though sensitive details might be redacted.

What are the performance metrics and quality assurance standards associated with this ammunition contract?

Performance metrics and quality assurance standards for defense contracts, especially for munitions, are typically stringent and detailed within the contract's Statement of Work (SOW) and associated specifications. While not explicitly provided in the summary data, this contract would likely include requirements for defect rates, shelf-life, operational reliability under various conditions, and adherence to specific military standards (e.g., MIL-STD). Quality assurance would involve rigorous testing protocols, inspections at various production stages, and potentially source inspections by government representatives. Failure to meet these standards could result in contract penalties, rejection of goods, or termination.

What is the track record of General Dynamics Ordnance and Tactical Systems Inc. in fulfilling similar large-scale defense manufacturing contracts?

General Dynamics Ordnance and Tactical Systems Inc. (GD-OTS) has a significant and established track record in fulfilling large-scale defense manufacturing contracts, particularly in the realm of munitions and ordnance. As a major defense contractor, GD-OTS is known for producing a wide array of ammunition types, including artillery shells, mortar rounds, and other ordnance systems for the U.S. military and allied nations. Their history likely includes numerous contracts with the Department of Defense, often involving complex manufacturing processes, stringent quality control, and timely delivery. While specific performance details for every contract are not always public, their continued presence and success in securing major awards suggest a generally reliable performance history in meeting defense requirements.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: ALTERNATIVE SOURCES

Solicitation ID: W52P1J07R0029

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 156 CEDAR AVE, SCRANTON, PA, 18505

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $105,184,577

Exercised Options: $105,184,577

Current Obligation: $105,184,577

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline