Department of Defense awards $185M contract for vehicular cabs and frames, with BAE Systems as the primary contractor

Contract Overview

Contract Amount: $185,174,217 ($185.2M)

Contractor: BAE Systems Tactical Vehicle Systems LP

Awarding Agency: Department of Defense

Start Date: 2004-07-09

End Date: 2007-09-30

Contract Duration: 1,178 days

Daily Burn Rate: $157.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TAS::21 2035::TAS 200410!007984!2100!W56HZV!TACOM - WARREN !W56HZV04C0591 !A!N! !N! ! !20040709!20050708!557414000!557414000!007932783!N!STEWART&STEVENSON TACTICAL V!5000 I-10 WEST !SEALY !TX!77474!66464!015!48!SEALY !AUSTIN !TEXAS !+000011604821!N!N!000000000000!2510!VEHICULAR CAB, BODY, FRAME STRUCTURAL COMP !A4B!NON-COMBAT VEHICLES !746 !FMTV !336399!E! !1! ! ! ! ! !99990909!B! ! !N!A!D!N!J!1!001!N!2A!A!Y!F! ! !N!C!N! ! ! !Z!Z!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: SEALY, COLORADO County, TEXAS, 77474

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $185.2 million to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP for work described as: TAS::21 2035::TAS 200410!007984!2100!W56HZV!TACOM - WARREN !W56HZV04C0591 !A!N! !N! ! !20040709!20050708!557414000!557414000!007932783!N!STEWART&STEVENSON TACTICAL V!5000 I-10 WEST !SEALY !TX!77474!66464!015!48!SEALY … Key points: 1. The contract value of $185 million represents a significant investment in tactical vehicle components. 2. Competition dynamics indicate a full and open process after source exclusion, suggesting a controlled but potentially competitive environment. 3. The contract duration of 1178 days points to a long-term need for these critical vehicle parts. 4. The primary contractor, BAE Systems, has a substantial presence in the defense manufacturing sector. 5. The product service code (PSC) for vehicular cabs and frames highlights a specialized manufacturing requirement. 6. The contract's focus on non-combat vehicles suggests a role in logistics and support rather than direct combat operations.

Value Assessment

Rating: good

The total award of $185,174,217.03 for vehicular cabs and frames appears to be within a reasonable range for large-scale defense manufacturing contracts of this nature. Benchmarking against similar contracts for vehicle components would provide a more precise value-for-money assessment. The firm-fixed-price contract type suggests that the government has secured a defined price, transferring some risk to the contractor. However, without detailed cost breakdowns or comparisons to commercial equivalents, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources.' This indicates that while the competition was broadly advertised, certain sources may have been excluded based on specific criteria. The number of bidders is not explicitly stated, but the 'full and open' designation implies a competitive process was intended. The exclusion of sources could potentially limit the breadth of competition, but the 'full and open' aspect suggests multiple bidders were still considered.

Taxpayer Impact: The competitive nature of this award, even with source exclusions, is generally beneficial for taxpayers as it aims to secure the best possible pricing and quality through market forces. A well-managed competition helps prevent overpayment and encourages efficiency from the awarded contractor.

Public Impact

The primary beneficiaries are the U.S. Army, receiving essential components for its non-combat vehicle fleet. The contract delivers critical vehicular cabs and frames, vital for the operational readiness and maintenance of military vehicles. The geographic impact is primarily centered around the contractor's facilities in Texas, with potential ripple effects in the local and regional supply chains. Workforce implications include job creation and sustainment within the defense manufacturing sector, particularly in areas related to specialized vehicle component production.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to source exclusion, which could impact long-term pricing.
Reliance on a single primary contractor for a critical component could pose supply chain risks.
The firm-fixed-price nature might incentivize cost-cutting that could affect long-term durability if not closely monitored.

Positive Signals

The 'full and open' competition aspect, despite exclusions, suggests an effort to leverage market competition.
BAE Systems is a well-established defense contractor, implying a degree of reliability and experience.
The contract's long duration indicates a stable demand and potential for contractor investment in production capabilities.

Sector Analysis

This contract falls within the broader defense manufacturing sector, specifically focusing on vehicle components. The market for tactical vehicle parts is substantial, driven by ongoing military modernization and sustainment efforts. Comparable spending benchmarks would involve analyzing other large-scale contracts for armored vehicle components, chassis, and structural elements. The industry is characterized by high technical requirements, stringent quality control, and long production cycles.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically mandated for small business participation through set-asides. However, the prime contractor, BAE Systems, may engage small businesses as subcontractors in its supply chain, contributing indirectly to the small business ecosystem. The absence of a set-aside means the primary focus was on securing the best overall offer from the market.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army contracting and program management offices. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified components. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Tactical Wheeled Vehicles
Family of Medium Tactical Vehicles (FMTV)
Military Vehicle Production
Defense Logistics Support Vehicles
Army Vehicle Modernization Programs

Risk Flags

Potential for limited competition due to source exclusion.
Contractor performance risk on long-term, large-value contracts.
Supply chain disruption risk for critical vehicle components.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $185.2 million to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP. TAS::21 2035::TAS 200410!007984!2100!W56HZV!TACOM - WARREN !W56HZV04C0591 !A!N! !N! ! !20040709!20050708!557414000!557414000!007932783!N!STEWART&STEVENSON TACTICAL V!5000 I-10 WEST !SEALY !TX!77474!66464!015!48!SEALY !AUSTIN !TEXAS !+000011604821!N!N!000000000000!2510!VEHICULAR CAB, BODY, FRAME STRUCTURAL COMP !A4B!NON-COMBAT VEHICLES !746 !FMTV !336399!E!

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $185.2 million.

What is the period of performance?

Start: 2004-07-09. End: 2007-09-30.

What is the historical spending pattern for vehicular cabs and frames by the Department of Defense?

Analyzing historical spending on vehicular cabs and frames requires a deep dive into procurement data over several fiscal years. The Department of Defense (DoD) consistently procures such components to maintain and modernize its vast fleet of tactical and non-tactical vehicles. Spending fluctuates based on major vehicle programs, fleet age, and modernization initiatives. For instance, the introduction or sustainment of programs like the Family of Medium Tactical Vehicles (FMTV) would significantly influence spending in this category. Without specific historical data points for this exact component (NA 336399), it's difficult to provide precise figures. However, it's reasonable to assume that annual spending in the tens to hundreds of millions of dollars is typical for such critical vehicle sub-systems across the entire DoD, reflecting the scale of its operational requirements and the need for robust, durable components.

How does the awarded price compare to similar contracts for vehicular cabs and frames?

Comparing the awarded price of approximately $185 million for vehicular cabs and frames requires access to a database of similar contracts, including their scope, quantity, and duration. The unit price, if calculable, would be a key metric. Given the 'definitive contract' type and the substantial total award, this likely covers a significant quantity of components over its 1178-day duration. BAE Systems' involvement suggests a large-scale production run. A preliminary assessment suggests the price is substantial, reflecting the specialized nature of military vehicle components, which often require higher durability and specific performance characteristics than commercial equivalents. A more precise comparison would necessitate identifying contracts with identical or very similar Product Service Codes (PSCs) and similar quantities and specifications.

What are the key performance indicators (KPIs) for this contract, and how is contractor performance being measured?

Key performance indicators (KPIs) for a contract of this nature typically revolve around schedule adherence, quality of delivered components, and cost control. For vehicular cabs and frames, KPIs would likely include on-time delivery rates, defect rates (e.g., number of non-conforming units), and compliance with technical specifications and performance standards. Contractor performance is usually measured through formal evaluations, such as Contractor Performance Assessment Reporting System (CPARS) reports, which document past performance on contracts. The Department of the Army's contracting officer and technical representatives would monitor these KPIs throughout the contract lifecycle, providing feedback and taking corrective actions if performance deviates from expectations. Meeting stringent military specifications is paramount.

What is the track record of BAE Systems Tactical Vehicle Systems LP in delivering similar defense contracts?

BAE Systems Tactical Vehicle Systems LP (and its predecessors/related entities) has a significant track record in delivering tactical and armored vehicles, as well as their components, to the U.S. military and allied nations. They have been a major player in programs like the Family of Medium Tactical Vehicles (FMTV) and various armored vehicle platforms. Their experience encompasses design, engineering, manufacturing, and sustainment of complex vehicle systems. While specific performance metrics for past contracts are often detailed in CPARS reports (which are not publicly detailed here), BAE Systems is generally recognized as a capable and experienced large defense contractor. However, like any large contractor, they may have faced challenges or received mixed reviews on specific contracts, underscoring the importance of ongoing performance monitoring.

What are the potential risks associated with the 'full and open competition after exclusion of sources' award type?

The 'full and open competition after exclusion of sources' award type presents a nuanced risk profile. On one hand, 'full and open' implies a broad attempt to solicit offers, which is generally positive for competition and price discovery. However, the 'exclusion of sources' introduces a layer of risk. This exclusion could be based on various factors, such as national security concerns, proprietary technology, or specific capability requirements that only a limited number of firms possess. The risk is that this exclusion might inadvertently narrow the competitive field more than necessary, potentially leading to higher prices or reduced innovation if the remaining pool of bidders is small or lacks robust competition. It also raises questions about the transparency and justification for the exclusions, which could be a point of scrutiny.

Industry Classification

NAICS: Manufacturing › Motor Vehicle Parts Manufacturing › All Other Motor Vehicle Parts Manufacturing

Product/Service Code: VEHICULAR EQUIPMENT COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC (UEI: 217304393)

Address: 5000 I-10 WEST, SEALY, TX, 77474

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $11,604,821

Exercised Options: $11,604,821

Current Obligation: $185,174,217

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline