DoD Awards $105.5M for MK80 Bomb Kits, Lacking Competition

Contract Overview

Contract Amount: $105,533,389 ($105.5M)

Contractor: General Dynamics Ordnance and Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-02-12

End Date: 2023-02-28

Contract Duration: 746 days

Daily Burn Rate: $141.5K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: THIS AWARD IS TO ISSUE REQUIREMENTS FOR THE MK80 SERIES GENERAL PURPOSE BOMB KITS - WHICH CONSISTS OF THE MK81-1 BOMB BODY, MK82-1 BOMB BODY, MK84-4 BOMB BODY, MK3-0 SUSPENSION LUG, MS3314 SUSPENSION LUG, TNT AND ALUMINUM POWDER.

Place of Performance

Location: GARLAND, DALLAS County, TEXAS, 75040

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $105.5 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC. for work described as: THIS AWARD IS TO ISSUE REQUIREMENTS FOR THE MK80 SERIES GENERAL PURPOSE BOMB KITS - WHICH CONSISTS OF THE MK81-1 BOMB BODY, MK82-1 BOMB BODY, MK84-4 BOMB BODY, MK3-0 SUSPENSION LUG, MS3314 SUSPENSION LUG, TNT AND ALUMINUM POWDER. Key points: 1. Significant award for essential bomb components, impacting munitions readiness. 2. Sole-source award raises concerns about price discovery and potential overspending. 3. Lack of competition limits opportunities for innovative solutions and cost savings. 4. The defense sector relies on such components for operational effectiveness.

Value Assessment

Rating: questionable

The $105.5 million award for bomb kits lacks competitive benchmarking due to its sole-source nature. Without competing offers, it's difficult to assess if the price reflects fair market value compared to similar contracts or alternative suppliers.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This significantly limits price discovery and may lead to higher costs for taxpayers as there was no competitive pressure to drive down prices.

Taxpayer Impact: The lack of competition on this substantial award means taxpayers may be paying a premium for these essential bomb components.

Public Impact

Ensures availability of critical components for general purpose bombs. Supports the Department of the Army's munitions manufacturing capabilities. Potential for higher costs due to the absence of competitive bidding. Impacts the defense industrial base's ability to supply essential ordnance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Potential for inflated pricing

Positive Signals

Essential defense procurement
Supports military readiness

Sector Analysis

This award falls within the Ammunition (except Small Arms) Manufacturing sector, a critical part of the defense industrial base. Spending benchmarks in this area are often influenced by geopolitical factors and long-term procurement strategies, but competition is key to efficiency.

Small Business Impact

The data indicates this award was not made to a small business. Further analysis would be needed to determine if small businesses were excluded from opportunities or if the prime contractor is utilizing small business subcontractors.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the government is receiving the best possible value and that justifications for non-competition are robust.

Related Government Programs

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

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Limited transparency in price discovery
No small business participation indicated

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $105.5 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC.. THIS AWARD IS TO ISSUE REQUIREMENTS FOR THE MK80 SERIES GENERAL PURPOSE BOMB KITS - WHICH CONSISTS OF THE MK81-1 BOMB BODY, MK82-1 BOMB BODY, MK84-4 BOMB BODY, MK3-0 SUSPENSION LUG, MS3314 SUSPENSION LUG, TNT AND ALUMINUM POWDER.

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 $105.5 million.

What is the period of performance?

Start: 2021-02-12. End: 2023-02-28.

What is the justification for awarding this contract on a sole-source basis?

The justification for a sole-source award typically involves factors such as unique capabilities, urgent need, or lack of adequate competition. Without further documentation, it's impossible to definitively state the reason, but it's a critical point for oversight to ensure the government's interests were protected and that competition was truly not feasible.

How does the unit cost compare to historical sole-source awards for similar bomb kits?

Comparing the unit cost to historical sole-source awards is challenging without access to detailed pricing data from previous contracts. However, a lack of competition inherently increases the risk of a higher unit cost compared to a competitively bid contract. Further investigation into historical pricing and cost breakdowns would be necessary for a precise comparison.

What is the long-term strategy for ensuring competitive sourcing of these bomb components?

The long-term strategy should focus on fostering a competitive environment for critical defense components like the MK80 series bomb kits. This could involve market research to identify potential new suppliers, encouraging existing suppliers to innovate and reduce costs, and re-evaluating sole-source justifications periodically to seek opportunities for competition.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1200 N GLENBROOK DR, GARLAND, TX, 75040

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: $105,533,389

Exercised Options: $105,533,389

Current Obligation: $105,533,389

Subaward Activity

Number of Subawards: 8

Total Subaward Amount: $1,699,071

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W52P1J19D0015

IDV Type: IDC

Timeline