DoD Awards $33.7M for 30mm Ammunition, Boosting General Dynamics' Defense Contract

Contract Overview

Contract Amount: $33,671,719 ($33.7M)

Contractor: General Dynamics Ordnance & Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2019-08-28

End Date: 2026-04-30

Contract Duration: 2,437 days

Daily Burn Rate: $13.8K/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: THIS DO IS FOR THE PROCUREMENT OF 30MM PGU-13 D/B LINKED CARTRIDGES (AMMUNITION). NSN: 1305-01-633-0903.

Place of Performance

Location: MARION, WILLIAMSON County, ILLINOIS, 62959

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $33.7 million to GENERAL DYNAMICS ORDNANCE & TACTICAL SYSTEMS, INC. for work described as: THIS DO IS FOR THE PROCUREMENT OF 30MM PGU-13 D/B LINKED CARTRIDGES (AMMUNITION). NSN: 1305-01-633-0903. Key points: 1. Significant award for essential military ammunition, highlighting defense sector needs. 2. General Dynamics secured a substantial contract, indicating strong market position. 3. Risk of supply chain disruption for critical munitions exists. 4. Ammunition manufacturing sector sees continued government investment.

Value Assessment

Rating: good

The contract value of $33.7 million for 30mm PGU-13 D/B linked cartridges appears reasonable given the specialized nature and quantity of ammunition. Benchmarking against similar defense procurement actions for ordnance would provide a more precise assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' suggesting a limited competition scenario. This method may impact price discovery by restricting the pool of potential bidders, potentially leading to higher costs than a truly open competition.

Taxpayer Impact: Taxpayer funds are allocated for essential defense materiel. The limited competition aspect warrants scrutiny to ensure cost-effectiveness and value for money.

Public Impact

Ensures continued supply of critical 30mm ammunition for military operations. Supports a key defense contractor, contributing to the defense industrial base. Impacts readiness and operational capabilities of armed forces relying on this ammunition. Potential for follow-on contracts based on performance and future needs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may reduce cost savings.
Reliance on a single supplier for critical components.
Potential for price increases in future orders.

Positive Signals

Ensures supply of essential defense equipment.
Supports established defense contractor with proven capabilities.
Long-term contract provides stability for production.

Sector Analysis

This contract falls within the Ammunition (except Small Arms) Manufacturing sector, a critical component of the defense industrial base. Spending in this area is driven by military readiness requirements and modernization efforts, with benchmarks often tied to specific weapon system needs.

Small Business Impact

The data indicates that this contract was not awarded to a small business. There is no explicit mention of small business subcontracting goals within the provided information, suggesting limited direct impact on small business participation for this specific award.

Oversight & Accountability

The contract was awarded by the Department of the Army, a component of the Department of Defense. Oversight would typically involve program management, quality assurance, and financial tracking to ensure contract compliance and effective use of funds.

Related Government Programs

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

Risk Flags

Limited competition may lead to higher costs.
Potential for supply chain disruption.
Lack of small business participation.
Long contract duration increases exposure to market changes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.7 million to GENERAL DYNAMICS ORDNANCE & TACTICAL SYSTEMS, INC.. THIS DO IS FOR THE PROCUREMENT OF 30MM PGU-13 D/B LINKED CARTRIDGES (AMMUNITION). NSN: 1305-01-633-0903.

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS ORDNANCE & 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 $33.7 million.

What is the period of performance?

Start: 2019-08-28. End: 2026-04-30.

What is the justification for excluding other sources in this 'Full and Open Competition After Exclusion of Sources' award, and how does it impact the overall value for taxpayers?

The justification for excluding other sources is crucial for understanding the limited competition. If specific technical requirements, existing weapon system compatibility, or unique manufacturing capabilities are the basis for exclusion, it might be justifiable. However, such exclusions can limit competitive pressure, potentially leading to less favorable pricing for taxpayers compared to a broader competition. A thorough review of the justification is needed to confirm value.

What are the potential risks associated with relying on General Dynamics Ordnance & Tactical Systems for such a critical defense component, especially given the limited competition?

The primary risks include potential supply chain vulnerabilities if General Dynamics faces production issues or disruptions. Limited competition also concentrates risk, as there are fewer alternatives if performance falters. Furthermore, a lack of robust competition could embolden the contractor to seek price increases in future orders or reduce quality standards, impacting long-term defense readiness and taxpayer value.

How does the 'FIRM FIXED PRICE' contract type contribute to cost control and predictability for this ammunition procurement, and are there mechanisms for price adjustments?

A Firm Fixed Price (FFP) contract is generally advantageous for cost control as it shifts the risk of cost overruns to the contractor. This provides predictability for the government's budget. However, the effectiveness depends on the initial price negotiation and the contractor's ability to manage costs. Mechanisms for price adjustments are typically limited in FFP contracts, but contract clauses might exist for economic price adjustments under specific, predefined conditions.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

Address: 6658 ROUTE 148, MARION, IL, 62959

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: $33,671,719

Exercised Options: $33,671,719

Current Obligation: $33,671,719

Subaward Activity

Number of Subawards: 26

Total Subaward Amount: $20,874,331

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52P1J18D0093

IDV Type: IDC

Timeline