Department of Defense awards $207.9M contract for inspection services, with a significant portion for combat vehicles

Contract Overview

Contract Amount: $49,019,714 ($49.0M)

Contractor: Canadian Commercial Corporation

Awarding Agency: Department of Defense

Start Date: 2006-09-29

End Date: 2009-09-30

Contract Duration: 1,097 days

Daily Burn Rate: $44.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIXED PRICE REDETERMINATION

Sector: Defense

Official Description: 200612!009664!2100!W56HZV!TACOM - WARREN !W56HZV06C0607 !A!N! !N! ! !20060929!20070331!207884594!207884594!241015486!N!CANADIAN COMMERCIAL CORPORATIO!50 O CONNOR ST STE 1100 !OTTAWA !CA! !00000! !CA! ! !CANADA !+000027279460!N!N!000000000000!H318!INSPECTINO SERVICES/SPACE VEHICLES !A4A!COMBAT VEHICLES !000 !NOT DISCERNABLE !336992!E! !3! ! ! ! ! !99990909!B! ! !N!Z!D!N!J!1!001!N!1A!Z!N!Z!B!ZZ!N!L!N! ! ! ! ! !A!A!000!A!B!N! ! ! ! ! ! !0001! !

Plain-Language Summary

Department of Defense obligated $49.0 million to CANADIAN COMMERCIAL CORPORATION for work described as: 200612!009664!2100!W56HZV!TACOM - WARREN !W56HZV06C0607 !A!N! !N! ! !20060929!20070331!207884594!207884594!241015486!N!CANADIAN COMMERCIAL CORPORATIO!50 O CONNOR ST STE 1100 !OTTAWA !CA! !00000! !CA! ! … Key points: 1. Contract awarded for inspection services, with a notable focus on combat vehicles. 2. The contract was not competed, raising questions about potential price discovery. 3. A fixed-price redetermination contract type suggests potential for cost adjustments. 4. The duration of the contract is approximately three years. 5. The primary contractor is Canadian Commercial Corporation. 6. The contract falls under the 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' NAICS code.

Value Assessment

Rating: questionable

The total award amount is $207.9 million over a period of roughly three years. Without comparable contracts or detailed cost breakdowns, it is difficult to definitively assess value for money. The fixed-price redetermination contract type implies that costs were estimated and are subject to adjustment, which can introduce uncertainty. Benchmarking against similar inspection services for military vehicles would be necessary for a more robust value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source or limited competition award. The data explicitly states 'NOT COMPETED'. This lack of competition means that the government did not solicit bids from multiple vendors, which can limit price negotiation and potentially lead to higher costs than if a competitive process had been undertaken.

Taxpayer Impact: For taxpayers, a non-competed contract means there was no opportunity to leverage market competition to secure the best possible price. This could result in the government paying more than necessary for the inspection services provided.

Public Impact

The primary beneficiaries are the Department of the Army and potentially units utilizing combat vehicles that require inspection. The contract delivers essential inspection services for military hardware, ensuring readiness and safety. The geographic impact is likely concentrated within areas where the Department of the Army operates and maintains its vehicle fleets. Workforce implications may include the need for specialized inspectors and support personnel, potentially both within the contractor's organization and the Army's oversight roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may have led to suboptimal pricing.
Fixed-price redetermination contract type introduces cost uncertainty.
Limited public information on the specific nature of inspection services.

Positive Signals

Contract awarded to a known entity, Canadian Commercial Corporation.
Services are critical for maintaining military vehicle readiness.
Contract duration provides a stable period for service delivery.

Sector Analysis

This contract falls within the Defense Industrial Base sector, specifically related to military vehicle manufacturing and maintenance. The NAICS code 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' indicates a focus on specialized equipment. Spending in this sector is substantial, driven by national security requirements and ongoing modernization efforts for military fleets. Comparable spending would involve other contracts for vehicle maintenance, repair, and inspection services within the Department of Defense.

Small Business Impact

There is no indication in the provided data that this contract involved small business set-asides or subcontracting requirements. The award was made to Canadian Commercial Corporation, and the data does not specify any provisions for engaging small businesses. This suggests that the primary focus was on the prime contractor's capabilities, with potential limited direct impact on the small business ecosystem unless the prime contractor independently utilizes small business subcontractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army, which is the procuring agency. Specific oversight mechanisms are not detailed in the provided data, but would typically include contract administration, performance monitoring, and quality assurance. Transparency is limited due to the non-competed nature and the lack of detailed public reporting on the specific inspection criteria and outcomes. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Vehicle Maintenance Contracts
Army Combat Vehicle Procurement and Support
Military Equipment Inspection Services
Defense Logistics Agency Contracts

Risk Flags

Lack of Competition
Potential for Overpricing
Contract Type Uncertainty (FPR)

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $49.0 million to CANADIAN COMMERCIAL CORPORATION. 200612!009664!2100!W56HZV!TACOM - WARREN !W56HZV06C0607 !A!N! !N! ! !20060929!20070331!207884594!207884594!241015486!N!CANADIAN COMMERCIAL CORPORATIO!50 O CONNOR ST STE 1100 !OTTAWA !CA! !00000! !CA! ! !CANADA !+000027279460!N!N!000000000000!H318!INSPECTINO SERVICES/SPACE VEHICLES !A4A!COMBAT VEHICLES !000 !NOT DISCERNABLE !336992!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is CANADIAN COMMERCIAL CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $49.0 million.

What is the period of performance?

Start: 2006-09-29. End: 2009-09-30.

What is the specific nature of the inspection services provided under this contract?

The provided data indicates the contract is for 'INSPECTINO SERVICES/SPACE VEHICLES' under the NAICS code 'Military Armored Vehicle, Tank, and Tank Component Manufacturing'. While 'space vehicles' is mentioned, the broader context and NAICS code suggest the primary focus is likely on ground combat vehicles. These services could encompass pre-shipment inspections, quality assurance checks during manufacturing or repair, post-maintenance verification, or readiness assessments. The exact scope would detail the types of vehicles, the specific inspection criteria (e.g., mechanical, electrical, structural integrity, operational readiness), and the reporting requirements. Without more granular data, the precise nature remains somewhat generalized.

How does the $207.9 million award compare to historical spending on similar inspection services for combat vehicles?

Direct historical spending comparisons for this specific 'inspection services' contract are not readily available from the provided data snippet. However, the Department of Defense consistently spends billions annually on vehicle maintenance, repair, and sustainment, which often includes inspection components. The $207.9 million award over approximately three years represents a significant, but not unprecedented, investment for specialized inspection services within the broader defense budget. To provide a precise comparison, one would need to analyze historical contract awards for similar services, potentially filtering by agency (Army), service type (inspection), and equipment type (combat vehicles), and adjusting for inflation over time.

What are the key risks associated with a 'NOT COMPETED' contract of this magnitude?

The primary risk associated with a 'NOT COMPETED' contract of this magnitude is the potential for inflated pricing due to the absence of market competition. Without bids from multiple vendors, the government may not achieve the most favorable price. Other risks include a lack of innovation that might be spurred by competition, and potential concerns about the contractor's performance if they are not regularly vetted against competitors. Furthermore, a sole-source award can sometimes indicate a lack of available qualified sources or a critical, time-sensitive need, which itself can introduce program risks if not managed carefully. Transparency and accountability are also more challenging to ensure without a competitive baseline.

What does the 'FIXED PRICE REDETERMINATION' contract type imply for cost control and contractor incentives?

A 'FIXED PRICE REDETERMINATION' (FPR) contract type signifies that the price is initially set but subject to revision based on actual costs incurred, up to a ceiling. This implies that the contractor has an incentive to control costs, as they will benefit from any savings below the redetermined price, but their profit is capped. For the government, it offers some cost certainty up to the ceiling but also introduces risk if actual costs significantly exceed initial estimates. The redetermination process requires robust auditing and negotiation to ensure the final price is fair and reasonable, making effective government oversight crucial for cost control.

What is the track record of Canadian Commercial Corporation in providing defense-related inspection services?

Canadian Commercial Corporation (CCC) is a Canadian Crown corporation that facilitates international trade for Canadian companies. While CCC itself does not typically perform services directly, it acts as a contracting agent, enabling Canadian businesses to secure contracts with foreign governments, including the U.S. Department of Defense. Their track record involves facilitating numerous defense contracts for Canadian suppliers. To assess their specific performance on this particular inspection services contract, one would need to examine performance reviews and payment histories associated with this award, which are not detailed in the provided data. CCC's general role suggests a capacity to manage complex international defense procurement.

Industry Classification

NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing

Product/Service Code: QUALITY CONTROL, TEST, INSPECTION › INSPECTION SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIXED PRICE REDETERMINATION (A)

Evaluated Preference: NONE

Contractor Details

Parent Company: Government of Canada (UEI: 241015486)

Address: 50 O'CONNOR ST SUITE 1100, OTTAWA

Business Categories: Category Business, Foreign Government, Foreign Owned, Not Designated a Small Business, Special Designations

Timeline