Department of Defense awards $20M+ contract for armored vehicles, highlighting specialized manufacturing needs

Contract Overview

Contract Amount: $20,082,894 ($20.1M)

Contractor: M D T Armor Corporation

Awarding Agency: Department of Defense

Start Date: 2009-06-23

End Date: 2011-12-31

Contract Duration: 921 days

Daily Burn Rate: $21.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 70 ARMOR LAND ROVER MDT-DAV

Place of Performance

Location: AUBURN, LEE County, ALABAMA, 36832

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $20.1 million to M D T ARMOR CORPORATION for work described as: 70 ARMOR LAND ROVER MDT-DAV Key points: 1. Contract value indicates significant investment in protected mobility solutions. 2. Sole-source award suggests limited market availability or specific technical requirements. 3. Contract duration points to a sustained need for these specialized assets. 4. Geographic location of awardee may influence regional economic impact. 5. Firm fixed-price structure aims to control costs for the government. 6. Absence of small business participation noted in the primary award.

Value Assessment

Rating: fair

The contract value of over $20 million for armored vehicles appears substantial. Without specific benchmarks for similar, highly specialized armored vehicle procurements, a direct value-for-money assessment is challenging. The firm fixed-price contract type is generally favorable for cost control. However, the lack of competitive bidding limits the ability to ascertain if the price reflects optimal market rates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This typically occurs when a product is unique, proprietary, or there's an urgent need that cannot be met through full and open competition. The limited competition means the government did not benefit from a bidding process that could drive down prices through market forces.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as there is no competitive pressure to ensure the lowest possible price.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, who will receive enhanced protection through the armored vehicles. The services delivered involve the manufacturing and supply of specialized armored vehicles. The geographic impact is primarily centered around the contractor's location in Alabama. Workforce implications include job creation and maintenance within the defense manufacturing sector at the contractor's facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing, potentially increasing cost to taxpayers.
Lack of transparency in the sole-source justification requires careful review.
No small business set-aside or subcontracting plan mentioned, potentially limiting broader economic participation.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to a specific manufacturer suggests a potentially established relationship or unique capability.
Contract duration indicates a long-term commitment to fulfilling a critical need.

Sector Analysis

The defense manufacturing sector is characterized by high barriers to entry, specialized technical expertise, and significant government investment. This contract falls within the 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' sub-sector. Spending in this area is driven by national security requirements and the need for advanced protection for military personnel in various operational environments. Comparable spending benchmarks are difficult to establish due to the niche nature of highly specialized armored vehicles.

Small Business Impact

This contract does not appear to have a small business set-aside. The sole-source nature of the award also means there was no opportunity for small businesses to compete directly. Furthermore, there is no explicit mention of subcontracting requirements for small businesses within the provided data. This suggests that the primary contract value will likely flow to the large business prime contractor, with limited direct impact on the small business defense ecosystem unless the prime voluntarily engages them.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management offices. Accountability measures are inherent in the firm fixed-price structure, which holds the contractor responsible for delivering the specified goods within the agreed-upon price. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Tactical Wheeled Vehicles
Armored Personnel Carriers
Mine-Resistant Ambush Protected (MRAP) Vehicles
Defense Vehicle Manufacturing
Military Vehicle Procurement

Risk Flags

Sole-source award requires justification review.
Potential for cost overruns if contractor's estimates were inaccurate.
Limited visibility into contractor's past performance from provided data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.1 million to M D T ARMOR CORPORATION. 70 ARMOR LAND ROVER MDT-DAV

Who is the contractor on this award?

The obligated recipient is M D T ARMOR 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 $20.1 million.

What is the period of performance?

Start: 2009-06-23. End: 2011-12-31.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' which is synonymous with a sole-source award. The specific justification for this determination is not detailed in the data. Typically, sole-source awards are made when only one responsible source can provide the required supplies or services, often due to unique capabilities, proprietary technology, urgent and compelling needs, or specific government requirements that cannot be met by multiple sources. Without further documentation from the Department of Defense, the precise reason remains unknown, but it implies a lack of readily available alternatives or a critical, time-sensitive need.

How does the contract value compare to similar armored vehicle procurements by the DoD?

Direct comparison of the $20 million contract value to similar armored vehicle procurements is challenging without more specific details on the type, quantity, and specifications of the vehicles. The defense market for armored vehicles is diverse, ranging from light tactical vehicles to heavy main battle tanks and specialized mine-resistant vehicles. The 'ARMOR LAND ROVER MDT-DAV' designation suggests a specific type of armored vehicle, possibly a derivative or modification of a Land Rover platform. The value seems moderate for a specialized vehicle contract, but without knowing the exact number of units and their complexity, a precise benchmark is difficult to establish. Further research into contracts for similar vehicle classes would be needed for a robust comparison.

What are the potential risks associated with a sole-source award for armored vehicles?

A primary risk of a sole-source award is the potential for inflated pricing due to the absence of competitive pressure. The government may end up paying more than it would in a competitive environment. Another risk is reduced innovation, as the contractor may have less incentive to improve products or processes without competitive threats. Furthermore, sole-source awards can raise concerns about fairness and transparency in the procurement process. Dependence on a single supplier can also create supply chain risks if that supplier faces production issues or goes out of business. Finally, it limits opportunities for other capable small and large businesses to enter the market or demonstrate their capabilities.

What is the track record of M D T ARMOR CORPORATION in fulfilling government contracts?

The provided data indicates that M D T ARMOR CORPORATION was awarded this specific contract. However, it does not offer details on their past performance, delivery history, or compliance with previous government contracts. To assess their track record, one would need to examine contract databases for previous awards, performance evaluations (such as Contractor Performance Assessment Reporting System - CPARS), and any history of contract disputes or terminations. Without this additional information, it is impossible to definitively state their track record beyond their ability to secure this particular award.

What is the expected impact of this contract on the defense industrial base in Alabama?

Given that the contractor, M D T ARMOR CORPORATION, is located in Alabama (ST: AL), this contract is likely to have a positive economic impact on the state's defense industrial base. It is expected to support or create jobs in specialized manufacturing, engineering, and related support functions within the company. This could also lead to increased business for local suppliers and service providers that support M D T ARMOR CORPORATION's operations. The sustained nature of the contract, spanning over two years, suggests a stable source of revenue and employment for the region.

How does the firm fixed-price (FFP) contract type influence risk allocation for this armored vehicle procurement?

The Firm Fixed-Price (FFP) contract type places the majority of the cost risk on the contractor, M D T ARMOR CORPORATION. Under an FFP agreement, the contractor is obligated to complete the work for a predetermined price, regardless of their actual costs incurred. This means that if the contractor's expenses for materials, labor, or overhead increase beyond their initial estimates, their profit margin will decrease. Conversely, if they manage their costs efficiently, their profit will increase. For the government, this structure provides cost certainty and predictability, as the final price is fixed, barring any contract modifications. This is generally favorable for the buyer, especially in procurements where the scope of work is well-defined.

Industry Classification

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

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Arotech Corporation (UEI: 825036189)

Address: 308 ALABAMA ST, AUBURN, AL, 03

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $20,082,894

Exercised Options: $20,082,894

Current Obligation: $20,082,894

Contract Characteristics

Cost or Pricing Data: NO

Timeline