DoD awards $17.8M contract for Egyptian coproduction of 120mm tank training ammunition

Contract Overview

Contract Amount: $17,759,968 ($17.8M)

Contractor: General Dynamics Ordnance and Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-12-30

End Date: 2026-12-31

Contract Duration: 1,827 days

Daily Burn Rate: $9.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: EGYPT COPRODUCTION OF 120MM TANK TRAINING AMMUNITION 30,000 EACH M865 CARTRIDGE 120MM TARGET PRACTICE CONE STABILIZED DISCARDING SABOT TRACER (TPCSDS-T) AND 16,000 EACH M831A1 CARTRIDGE 120MM TARGET PRACTICE-TRACER (TP-T)

Place of Performance

Location: SAINT PETERSBURG, PINELLAS County, FLORIDA, 33716

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $17.8 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC. for work described as: EGYPT COPRODUCTION OF 120MM TANK TRAINING AMMUNITION 30,000 EACH M865 CARTRIDGE 120MM TARGET PRACTICE CONE STABILIZED DISCARDING SABOT TRACER (TPCSDS-T) AND 16,000 EACH M831A1 CARTRIDGE 120MM TARGET PRACTICE-TRACER (TP-T) Key points: 1. Contract focuses on M865 TPCSDS-T and M831A1 TP-T cartridges, crucial for tank crew training. 2. Sole-source award to General Dynamics Ordnance and Tactical Systems, Inc. raises competition concerns. 3. Long-term contract duration (2021-2026) suggests a sustained need for this specialized ammunition. 4. The coproduction aspect with Egypt could have geopolitical and industrial base implications.

Value Assessment

Rating: questionable

The contract value of $17.8 million for 46,000 rounds of specialized training ammunition appears high, especially given the sole-source nature. Without competitive bids, it's difficult to benchmark against market rates or similar government contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded on a sole-source basis, indicating no competition was sought. This limits price discovery and potentially leads to higher costs for the taxpayer. The rationale for sole-sourcing is not provided.

Taxpayer Impact: The lack of competition in this sole-source award may result in a higher cost to taxpayers than if the contract had been competitively bid.

Public Impact

Ensures continued availability of essential training ammunition for tank crews. Supports U.S. foreign policy objectives through coproduction with Egypt. Potential impact on domestic ammunition manufacturing capacity and supply chains. Raises questions about the cost-effectiveness of sole-source procurements for defense articles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
High per-unit cost is likely due to lack of competition.
Long contract duration may not reflect current market conditions.
Coproduction details and benefits are not fully transparent.

Positive Signals

Addresses a critical training need for armored forces.
Supports a key U.S. ally through coproduction.
Utilizes a known and experienced defense contractor.

Sector Analysis

This contract falls under the Ammunition (except Small Arms) Manufacturing sector. Spending in this sector is critical for maintaining military readiness, but often involves specialized, high-cost components. Benchmarks are difficult without competitive data.

Small Business Impact

The contract was awarded to General Dynamics Ordnance and Tactical Systems, Inc., a large business. There is no indication that small businesses were involved as subcontractors or partners in this specific award.

Oversight & Accountability

The sole-source nature of this award warrants further oversight to ensure the price is fair and reasonable. Transparency regarding the justification for sole-sourcing and the coproduction agreement is crucial for accountability.

Related Government Programs

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

Risk Flags

Lack of competition
Potential for inflated pricing
Limited transparency on coproduction details
Long-term contract duration without clear market review
Dependence on a single contractor for critical defense items

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.8 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC.. EGYPT COPRODUCTION OF 120MM TANK TRAINING AMMUNITION 30,000 EACH M865 CARTRIDGE 120MM TARGET PRACTICE CONE STABILIZED DISCARDING SABOT TRACER (TPCSDS-T) AND 16,000 EACH M831A1 CARTRIDGE 120MM TARGET PRACTICE-TRACER (TP-T)

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 $17.8 million.

What is the period of performance?

Start: 2021-12-30. End: 2026-12-31.

What is the specific justification for awarding this contract on a sole-source basis, and what steps were taken to ensure the price is fair and reasonable?

The provided data does not include the justification for the sole-source award. Typically, sole-sourcing is used when only one responsible source can provide the required supplies or services. Agencies must still conduct price analysis to ensure the negotiated price is fair and reasonable, often by comparing to historical prices, commercial prices, or independent government cost estimates.

What are the long-term strategic benefits and risks associated with the coproduction of this ammunition with Egypt?

Coproduction can strengthen alliances, enhance interoperability, and potentially reduce costs through shared production. However, risks include technology transfer concerns, potential for intellectual property issues, and dependence on a foreign partner for critical defense articles. The specific benefits and risks would depend on the detailed terms of the coproduction agreement.

How does the per-unit cost of this training ammunition compare to similar domestically produced or commercially available training rounds?

Without competitive bidding data or access to specific cost breakdowns, a direct per-unit cost comparison is not feasible. Sole-source contracts often obscure true market costs. A thorough analysis would require access to internal DoD cost estimates, historical pricing for similar items, and potentially commercial market research if comparable items exist.

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 AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W52P1J20R0103

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

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: $17,759,968

Exercised Options: $17,759,968

Current Obligation: $17,759,968

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline