DoD Awards $464M for New Tank Training Ammunition Production to General Dynamics

Contract Overview

Contract Amount: $464,427,555 ($464.4M)

Contractor: General Dynamics Ordnance and Tactical Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-05-26

End Date: 2028-07-03

Contract Duration: 2,230 days

Daily Burn Rate: $208.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 120MM TANK TRAINING AMMUNITION M1002 NEW PRODUCTION M865A1 NEW PRODUCTION

Place of Performance

Location: SAINT PETERSBURG, PINELLAS County, FLORIDA, 33716

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $464.4 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC. for work described as: 120MM TANK TRAINING AMMUNITION M1002 NEW PRODUCTION M865A1 NEW PRODUCTION Key points: 1. Significant investment in critical defense training capabilities. 2. General Dynamics is a major defense contractor, indicating established capabilities. 3. Risk of cost overruns or production delays exists in long-term contracts. 4. Ammunition manufacturing is a key sector for national defense readiness.

Value Assessment

Rating: good

The contract value of $464.4M over approximately 6 years appears reasonable for new production of specialized ammunition. Benchmarking against similar large-scale ammunition procurements would provide further context.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process that should drive price discovery. The definitive contract type indicates a commitment to purchase over the period.

Taxpayer Impact: Taxpayer funds are being used to enhance military training capabilities, ensuring readiness. Competition aims to secure the best value for this investment.

Public Impact

Enhances training realism and effectiveness for armored units. Supports readiness of U.S. and allied forces. Contributes to the domestic defense industrial base. Ensures availability of critical munitions for training exercises.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long-term contract duration increases risk of price escalation.
New production runs may face unforeseen manufacturing challenges.
Dependence on a single supplier for this critical item.

Positive Signals

Full and open competition should yield competitive pricing.
Firm Fixed Price contract provides cost certainty.
Contract supports modernization of training ammunition.

Sector Analysis

This contract falls within the defense sector, specifically ammunition manufacturing. Spending benchmarks for similar large-scale defense procurements are typically in the hundreds of millions to billions of dollars.

Small Business Impact

The award went to a large prime contractor, General Dynamics. There is no explicit indication of small business participation in this specific award announcement, suggesting potential for subcontracting opportunities.

Oversight & Accountability

The Department of the Army is the contracting agency. Oversight will focus on contract performance, delivery schedules, and adherence to the firm fixed price terms to ensure accountability.

Related Government Programs

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

Risk Flags

Long contract duration (over 6 years).
New production runs carry inherent risks.
Potential for sole-source reliance if follow-on contracts are needed.
Inflationary pressures could impact long-term fixed-price contracts.
Dependence on specific raw material availability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $464.4 million to GENERAL DYNAMICS ORDNANCE AND TACTICAL SYSTEMS, INC.. 120MM TANK TRAINING AMMUNITION M1002 NEW PRODUCTION M865A1 NEW PRODUCTION

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 $464.4 million.

What is the period of performance?

Start: 2022-05-26. End: 2028-07-03.

What is the projected unit cost for the M1002 and M865A1 ammunition, and how does it compare to previous procurements or industry benchmarks?

The provided data does not specify the unit cost. However, the total contract value of $464.4M over approximately 2230 days (around 6 years) suggests an average annual spend of roughly $77.4M. Detailed cost breakdowns and comparisons to historical data or industry benchmarks would be necessary for a thorough value assessment.

What are the specific risks associated with 'new production' of this ammunition, and what mitigation strategies are in place?

Risks with new production can include initial manufacturing inefficiencies, supply chain disruptions for raw materials, and potential quality control issues. Mitigation strategies typically involve robust testing protocols, phased production ramp-ups, strong supplier relationships, and contingency planning for material shortages.

How effective is this new ammunition in meeting evolving training requirements compared to older variants?

The effectiveness hinges on the specific improvements in the M1002 and M865A1 variants, such as enhanced accuracy, safety features, or realistic simulation capabilities. Detailed technical specifications and user feedback from training exercises would be needed to assess its effectiveness in meeting evolving combat scenarios and training objectives.

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

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W52P1J21R0035

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

Address: 100 CARILLON PKWY, 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: $1,977,757,573

Exercised Options: $464,427,555

Current Obligation: $464,427,555

Subaward Activity

Number of Subawards: 38

Total Subaward Amount: $34,606,833

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline