DoD awards $294M for tank training ammunition, with multi-year options extending through FY2021

Contract Overview

Contract Amount: $294,018,407 ($294.0M)

Contractor: General Dynamics Ordnance and Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2017-03-29

End Date: 2023-10-17

Contract Duration: 2,393 days

Daily Burn Rate: $122.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: AWARD FISCAL YEAR 2017 120MM TANK TRAINING AMMUNITION REQUIREMENTS. OPTIONS FOR FISCAL YEAR 2018 THROUGH FISCAL YEAR 2021 REQUIREMENTS AVAILABLE TO BE EXERCISED.

Place of Performance

Location: SAINT PETERSBURG, PINELLAS County, FLORIDA, 33716

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $294.0 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC. for work described as: AWARD FISCAL YEAR 2017 120MM TANK TRAINING AMMUNITION REQUIREMENTS. OPTIONS FOR FISCAL YEAR 2018 THROUGH FISCAL YEAR 2021 REQUIREMENTS AVAILABLE TO BE EXERCISED. Key points: 1. Contract awarded to General Dynamics Ordnance and Tactical Systems, Inc. for ammunition manufacturing. 2. The contract includes options that could extend performance through October 2023. 3. This award represents a significant investment in military training readiness. 4. The North American Industry Classification System (NAICS) code is 332993, indicating ammunition manufacturing. 5. The contract type is Firm Fixed Price, providing cost certainty for the government. 6. The contract was awarded under Full and Open Competition after Exclusion of Sources.

Value Assessment

Rating: good

The total award amount of $294 million over the base and option periods appears to be a substantial investment in critical training munitions. Benchmarking this against similar large-scale ammunition procurements would be necessary for a precise value-for-money assessment. However, the firm fixed-price structure suggests a degree of cost control and predictability for the Department of Defense.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition after Exclusion of Sources.' This specific designation suggests that while competition was sought, certain sources may have been excluded based on specific criteria, potentially limiting the breadth of the competitive field. Further details on the exclusion rationale would clarify the extent of competition.

Taxpayer Impact: The limited competition may have implications for price discovery, potentially leading to less aggressive bidding compared to a truly unrestricted full and open competition. Taxpayers benefit from competition, but the specific nature of this exclusion warrants scrutiny to ensure optimal pricing.

Public Impact

The primary beneficiaries are the U.S. Army and other Department of Defense branches requiring tank training ammunition. This contract ensures the availability of essential munitions for training exercises, directly supporting military readiness. The contract is associated with the state of Florida, indicating potential economic impact and workforce implications in that region. The services delivered are the manufacturing and supply of specialized ammunition for armored vehicle training.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to 'Exclusion of Sources' designation.
Reliance on a single contractor for a critical defense supply chain component.
Long contract duration could lead to price escalation if not managed effectively.

Positive Signals

Firm Fixed Price contract provides cost certainty.
Award to an established defense contractor with a track record in ordnance.
Multi-year options provide supply chain stability for training needs.

Sector Analysis

This contract falls within the defense manufacturing sector, specifically focusing on ordnance and ammunition. The market for military ammunition is characterized by long-term government contracts, specialized manufacturing capabilities, and significant barriers to entry. General Dynamics is a major player in this space, and this award reflects its established position. Comparable spending benchmarks would involve analyzing other large-scale ammunition procurements by the DoD.

Small Business Impact

The data indicates that small business participation (sb: false) was not a primary set-aside consideration for this specific contract. There is no explicit mention of subcontracting goals for small businesses. This suggests that the primary focus was on securing the required specialized ammunition from a capable large business, with potential limited direct benefit to the small business ecosystem in this instance.

Oversight & Accountability

The contract is subject to standard Department of Defense oversight mechanisms for procurement and contract performance. Accountability measures would include performance reviews, quality assurance checks, and adherence to the firm fixed-price terms. Transparency is generally maintained through contract award databases, though specific details of the 'Exclusion of Sources' rationale may be less publicly accessible.

Related Government Programs

Department of the Army Ammunition Procurement
Defense Industrial Base Manufacturing
Military Training and Readiness Programs
Ordnance and Munitions Supply Chain

Risk Flags

Potential for limited competition
Long-term contract duration
Reliance on specific manufacturing capabilities

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $294.0 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC.. AWARD FISCAL YEAR 2017 120MM TANK TRAINING AMMUNITION REQUIREMENTS. OPTIONS FOR FISCAL YEAR 2018 THROUGH FISCAL YEAR 2021 REQUIREMENTS AVAILABLE TO BE EXERCISED.

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 $294.0 million.

What is the period of performance?

Start: 2017-03-29. End: 2023-10-17.

What is the historical spending pattern for tank training ammunition by the Department of the Army?

Analyzing historical spending for tank training ammunition by the Department of the Army requires access to detailed procurement data over multiple fiscal years. Typically, such spending fluctuates based on operational tempo, training cycle requirements, and modernization efforts. Factors like the introduction of new tank platforms or changes in training doctrines can significantly influence demand. Without specific historical data for this exact type of ammunition, it's difficult to provide precise figures. However, it's reasonable to assume that consistent funding is allocated annually to ensure adequate training stocks, with potential for larger, multi-year awards like this one to achieve economies of scale and ensure long-term supply chain stability. The $294 million award for FY2017-FY2021 suggests a significant, ongoing requirement for this specific munition.

How does the awarded price compare to similar tank training ammunition contracts?

A direct comparison of the awarded price ($294 million) to similar tank training ammunition contracts is challenging without access to a comprehensive database of comparable procurements. Key factors influencing price include the specific type and caliber of ammunition, quantity ordered, contract duration, manufacturing complexity, and the competitive landscape at the time of award. General Dynamics Ordnance and Tactical Systems, Inc. is a major supplier, and their pricing is influenced by their production capacity and overhead. To benchmark effectively, one would need to identify contracts for identical or highly similar munitions awarded around the same period, under similar competitive conditions, and from different manufacturers if available. The firm fixed-price nature of this contract provides a degree of cost certainty, but the ultimate value-for-money depends on whether this price reflects competitive market rates for such specialized defense articles.

What are the specific risks associated with a 'Full and Open Competition after Exclusion of Sources' award?

The primary risk associated with 'Full and Open Competition after Exclusion of Sources' is the potential for reduced competition, which can negatively impact price discovery and potentially lead to higher costs for the government. While the intent is to ensure competition among qualified sources, the exclusion of certain entities, if not rigorously justified and transparently communicated, could limit the number of bidders. This could result in less aggressive pricing than might be achieved in a completely unrestricted competition. Additionally, if the excluded sources possess unique capabilities or cost advantages, their absence could mean the government is not securing the absolute best value. The justification for exclusion needs to be robust to mitigate the risk of perceived or actual favoritism and to ensure taxpayer funds are used efficiently.

What is General Dynamics Ordnance and Tactical Systems, Inc.'s track record with DoD ammunition contracts?

General Dynamics Ordnance and Tactical Systems, Inc. (GD-OTS) has a well-established and extensive track record of supplying ammunition and ordnance to the U.S. Department of Defense and allied nations. They are a significant player in the defense industrial base, known for producing a wide range of munitions, including large-caliber rounds for armored vehicles, artillery, and mortars, as well as smaller caliber ammunition. Their history includes numerous contracts for training and combat-use munitions, often awarded through competitive processes. GD-OTS has demonstrated capabilities in manufacturing, quality control, and program management for complex defense supply requirements. Their continued success in securing large contracts like this one suggests a strong performance history and confidence from the DoD in their ability to meet demanding specifications and delivery schedules.

How does this contract contribute to the overall readiness and training effectiveness of U.S. armored forces?

This contract is crucial for maintaining the readiness and enhancing the training effectiveness of U.S. armored forces. Tank training ammunition is a consumable but essential component for realistic and effective crew training. Without a reliable and sufficient supply of this ammunition, training exercises would be curtailed, simulated, or conducted with less realistic parameters, thereby diminishing the proficiency of tank crews and their ability to operate effectively in combat scenarios. By securing a multi-year supply through this $294 million award, the Department of the Army ensures that its armored units have consistent access to the munitions needed for drills, tactical exercises, and qualification courses, directly supporting the development and maintenance of combat-ready forces.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W52P1J16R0064

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11399 16TH CT N STE 200, SAINT PETERSBURG, FL, 33716

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: $294,018,407

Exercised Options: $294,018,407

Current Obligation: $294,018,407

Subaward Activity

Number of Subawards: 77

Total Subaward Amount: $56,968,841

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline