DoD's $602M Ground Combat Vehicle Tech Development Awarded to General Dynamics Amidst Full and Open Competition
Contract Overview
Contract Amount: $602,335,158 ($602.3M)
Contractor: General Dynamics Land Systems Inc.
Awarding Agency: Department of Defense
Start Date: 2011-08-18
End Date: 2014-06-04
Contract Duration: 1,021 days
Daily Burn Rate: $589.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: TECHNOLOGY DEVELOPMENT PHASE OF THE GROUND COMBAT VEHICLE.
Place of Performance
Location: STERLING HEIGHTS, MACOMB County, MICHIGAN, 48310, UNITED STATES OF AMERICA
State: Michigan Government Spending
Plain-Language Summary
Department of Defense obligated $602.3 million to GENERAL DYNAMICS LAND SYSTEMS INC. for work described as: TECHNOLOGY DEVELOPMENT PHASE OF THE GROUND COMBAT VEHICLE. Key points: 1. Significant investment in advanced military technology development. 2. General Dynamics Land Systems Inc. secured a major contract. 3. Full and open competition was utilized, suggesting a robust price discovery process. 4. The contract spans over 1000 days, indicating a complex, multi-year project.
Value Assessment
Rating: fair
The award amount of $602.3 million for a technology development phase is substantial. Benchmarking against similar R&D contracts for complex defense systems is difficult without more granular cost data, but the fixed-price incentive structure suggests an attempt to control costs while allowing for shared risk.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically fosters competitive pricing and allows the government to select the best value. The use of a Fixed Price Incentive (FPI) contract type indicates that both the contractor and the government share in any cost savings or overruns beyond target levels.
Taxpayer Impact: The competitive nature of the award is intended to ensure taxpayer funds are used efficiently for advanced defense capabilities, though the ultimate value depends on the successful development of the Ground Combat Vehicle.
Public Impact
Enhances U.S. military ground combat capabilities. Potential for technological advancements with broader defense applications. Supports jobs in the defense manufacturing sector, particularly in Michigan.
Waste & Efficiency Indicators
Waste Risk Score: 58 / 10
Warning Flags
- Technology development is inherently risky and may not yield desired outcomes.
- Long project duration increases exposure to changing requirements and economic conditions.
- Fixed Price Incentive contracts can lead to cost overruns if not managed tightly.
Positive Signals
- Awarded under full and open competition.
- Significant government investment in modernization.
- Contract awarded to an established defense contractor.
Sector Analysis
This contract falls within the defense sector, specifically focusing on advanced military vehicle technology. Spending in this area is driven by national security needs and technological superiority objectives. Benchmarks for R&D phases of major defense platforms are highly variable.
Small Business Impact
The data indicates that small businesses were not directly awarded this prime contract. Further analysis would be needed to determine the extent of small business participation as subcontractors.
Oversight & Accountability
The Department of the Army's acquisition process, including the use of full and open competition and specific contract types like FPI, aims to provide oversight. However, the effectiveness of oversight for complex, long-term technology development projects requires continuous monitoring.
Related Government Programs
- Military Armored Vehicle, Tank, and Tank Component Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- High R&D costs.
- Potential for schedule delays.
- Technological obsolescence risk.
- Contract performance risk.
- Budgetary uncertainty for follow-on phases.
Tags
military-armored-vehicle-tank-and-tank-c, department-of-defense, mi, dca, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $602.3 million to GENERAL DYNAMICS LAND SYSTEMS INC.. TECHNOLOGY DEVELOPMENT PHASE OF THE GROUND COMBAT VEHICLE.
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS LAND 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 $602.3 million.
What is the period of performance?
Start: 2011-08-18. End: 2014-06-04.
What is the projected return on investment for this technology development phase in terms of enhanced combat effectiveness?
Quantifying the ROI for a technology development phase is challenging as it precedes full-scale production and deployment. The primary goal is to mature critical technologies for future ground combat vehicles. Success will be measured by the successful demonstration of required capabilities, reduced risk for subsequent phases, and potential improvements in soldier survivability, operational efficiency, and lethality, which indirectly contribute to overall defense effectiveness.
What are the key technical risks associated with this Ground Combat Vehicle technology development, and how are they being mitigated?
Key risks likely include integration of novel propulsion systems, advanced armor technologies, sophisticated sensor suites, and network-centric warfare capabilities. Mitigation strategies typically involve phased development, rigorous testing and evaluation at component and subsystem levels, prototyping, and incorporating lessons learned from previous vehicle programs. The FPI contract structure also incentivizes the contractor to manage and mitigate cost-related risks.
How does this contract align with the Army's long-term modernization strategy and force structure goals?
This contract directly supports the Army's modernization efforts by investing in the next generation of ground combat vehicles, aiming to replace or augment aging platforms. Successful development could provide a significant advantage in future conflict scenarios, aligning with strategic goals of maintaining technological superiority. The program's alignment will be continuously assessed against evolving threats and strategic priorities throughout its lifecycle.
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: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W56HZV11R0001
Offers Received: 3
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp (UEI: 001381284)
Address: 38500 MOUND RD, STERLING HEIGHTS, MI, 48310
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $602,335,158
Exercised Options: $602,335,158
Current Obligation: $602,335,158
Subaward Activity
Number of Subawards: 363
Total Subaward Amount: $1,168,049,597
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2011-08-18
Current End Date: 2014-06-04
Potential End Date: 2014-06-04 00:00:00
Last Modified: 2015-03-02
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