DoD Awards $4.07B for 10,000 Family of Medium Tactical Vehicles to BAE Systems
Contract Overview
Contract Amount: $4,067,162,786 ($4.1B)
Contractor: BAE Systems Tactical Vehicle Systems LP
Awarding Agency: Department of Defense
Start Date: 2008-05-30
End Date: 2024-09-30
Contract Duration: 5,967 days
Daily Burn Rate: $681.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: PROCUREMENT OF 10,000 FAMILY OF MEDIUM TACTICAL VEHICLES. ALSO ADDING PROGRAM SUPPORT AND FEDERAL RETAIL EXCISE TAX. THIS ACTION IS BEING ADDED AS AN UNDEFINITIZED CONTRACTUAL ACTION
Place of Performance
Location: SEALY, COLORADO County, TEXAS, 77474
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $4.07 billion to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP for work described as: PROCUREMENT OF 10,000 FAMILY OF MEDIUM TACTICAL VEHICLES. ALSO ADDING PROGRAM SUPPORT AND FEDERAL RETAIL EXCISE TAX. THIS ACTION IS BEING ADDED AS AN UNDEFINITIZED CONTRACTUAL ACTION Key points: 1. Significant investment in tactical vehicle fleet modernization. 2. Sole-source award raises questions about competition and potential cost savings. 3. Long contract duration (2008-2024) suggests ongoing program needs. 4. Federal retail excise tax inclusion adds to overall program cost.
Value Assessment
Rating: questionable
The contract value of $4.07 billion for 10,000 vehicles is substantial. Without competitive bidding, it's difficult to benchmark against similar procurements to assess if the pricing is optimal.
Cost Per Unit: $406,716 per vehicle
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and may result in higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition for such a large procurement could lead to suboptimal pricing, potentially costing taxpayers millions more than necessary.
Public Impact
Enhances military operational capabilities with new tactical vehicles. Supports BAE Systems' manufacturing operations and related supply chains. Potential for long-term sustainment and maintenance contracts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Undefinitized Contractual Action (UCA)
- Long contract duration
Positive Signals
- Modernization of critical military assets
- Program support included
Sector Analysis
This procurement falls within the Defense sector, specifically in the manufacturing of tactical vehicles. Spending benchmarks for similar large-scale vehicle procurements are often influenced by technological advancements, quantity, and the competitive landscape.
Small Business Impact
The data indicates this contract was awarded to BAE Systems Tactical Vehicle Systems LP and does not specify any small business participation. Further analysis would be needed to determine if small businesses are involved as subcontractors.
Oversight & Accountability
The use of an Undefinitized Contractual Action (UCA) requires close oversight to ensure definitization occurs promptly and at a fair and reasonable price. The Defense Contract Management Agency (DCMA) is responsible for this oversight.
Related Government Programs
- Truck Trailer Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award
- Undefinitized Contractual Action (UCA)
- Long contract duration
- Potential for cost creep
- Lack of transparency in pricing
Tags
truck-trailer-manufacturing, department-of-defense, tx, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $4.07 billion to BAE SYSTEMS TACTICAL VEHICLE SYSTEMS LP. PROCUREMENT OF 10,000 FAMILY OF MEDIUM TACTICAL VEHICLES. ALSO ADDING PROGRAM SUPPORT AND FEDERAL RETAIL EXCISE TAX. THIS ACTION IS BEING ADDED AS AN UNDEFINITIZED CONTRACTUAL ACTION
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 (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $4.07 billion.
What is the period of performance?
Start: 2008-05-30. End: 2024-09-30.
What is the justification for the sole-source award of this significant tactical vehicle contract?
The justification for a sole-source award typically involves reasons such as unique capabilities, urgent need, or lack of viable alternatives. Without specific documentation, it's difficult to ascertain the precise rationale. However, sole-source procurements often raise concerns about potential cost inefficiencies and missed opportunities for innovation that competition can drive.
What are the risks associated with the Undefinitized Contractual Action (UCA) status of this contract?
The primary risk of a UCA is that the contractor begins work before a definitive contract with agreed-upon terms and pricing is finalized. This can lead to cost overruns if the final negotiated price is higher than initially anticipated. It also shifts some risk to the government, as the contractor is performing work under potentially unfavorable terms until definitization.
How does the long contract duration (2008-2024) impact the overall value and effectiveness of this procurement?
A long contract duration can indicate a sustained need for the procured items and potentially allow for economies of scale and stable production. However, it also increases the risk of technological obsolescence, price escalation over time, and reduced flexibility to adapt to changing requirements or market conditions. Effective management is crucial to ensure continued value and effectiveness.
Industry Classification
NAICS: Manufacturing › Motor Vehicle Body and Trailer Manufacturing › Truck Trailer Manufacturing
Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W56HZV07R0255
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Compagnie DE Developpement DE L'eau S.A.
Address: 2941 FAIRVIEW PARK DR STE 100, FALLS CHURCH, VA, 22042
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $4,067,162,786
Exercised Options: $4,067,162,786
Current Obligation: $4,067,162,786
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2008-05-30
Current End Date: 2024-09-30
Potential End Date: 2024-09-30 00:00:00
Last Modified: 2024-11-05
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