DoD Awards $280M to General Dynamics for Tank ECP Upgrade Program, No Competition
Contract Overview
Contract Amount: $279,847,165 ($279.8M)
Contractor: General Dynamics Land Systems Inc.
Awarding Agency: Department of Defense
Start Date: 2013-11-25
End Date: 2022-02-28
Contract Duration: 3,017 days
Daily Burn Rate: $92.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: IGF::OT::IGF PHASE II OF THE ENGINEERING CHANGE PROPOSAL (ECP) UPGRADE PROGRAM
Place of Performance
Location: STERLING HEIGHTS, MACOMB County, MICHIGAN, 48310
State: Michigan Government Spending
Plain-Language Summary
Department of Defense obligated $279.8 million to GENERAL DYNAMICS LAND SYSTEMS INC. for work described as: IGF::OT::IGF PHASE II OF THE ENGINEERING CHANGE PROPOSAL (ECP) UPGRADE PROGRAM Key points: 1. Significant investment in armored vehicle modernization. 2. Sole-source award raises questions about price discovery. 3. Long contract duration (2013-2022) suggests potential for cost overruns. 4. Focus on military vehicle manufacturing, a key defense sector.
Value Assessment
Rating: questionable
The contract type is Cost Plus Incentive Fee, which can incentivize cost control but also carries risk if not managed tightly. The awarded amount of $279.8M over a long period needs careful scrutiny against performance and delivery.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no competitive pressure to drive down prices.
Taxpayer Impact: The lack of competition for a nearly $280M contract raises concerns about whether the government achieved the best possible price for this critical upgrade program.
Public Impact
Modernization of essential military hardware. Potential impact on readiness and operational capabilities. Taxpayer funds allocated to a specific defense contractor.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Long contract duration
- No small business participation
Positive Signals
- Essential military modernization
- Definitive contract award
Sector Analysis
This contract falls within the Defense sector, specifically focusing on military armored vehicle manufacturing. Spending benchmarks for similar ECP programs are difficult to ascertain without competitive data, but the scale of this award is substantial.
Small Business Impact
The data indicates no small business participation in this contract. This is common for large, complex defense prime contracts, but it means opportunities for small businesses in this specific procurement were limited.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the contractor is meeting performance requirements and that costs are reasonable and allocable. Audits of cost-plus contracts are crucial.
Related Government Programs
- Military Armored Vehicle, Tank, and Tank Component Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award
- Cost-plus contract type
- Long contract duration
- No small business participation
- Lack of transparency on justification for sole-sourcing
Tags
military-armored-vehicle-tank-and-tank-c, department-of-defense, mi, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $279.8 million to GENERAL DYNAMICS LAND SYSTEMS INC.. IGF::OT::IGF PHASE II OF THE ENGINEERING CHANGE PROPOSAL (ECP) UPGRADE PROGRAM
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 $279.8 million.
What is the period of performance?
Start: 2013-11-25. End: 2022-02-28.
What was the justification for the sole-source award, and were alternatives explored?
The justification for a sole-source award is critical for understanding why competition was bypassed. Agencies typically cite reasons like unique capabilities, urgent needs, or lack of viable alternatives. Without this justification, it's difficult to assess if the government acted in its best interest or if taxpayer funds were potentially misspent due to a lack of competitive pressure.
How did the final costs compare to the initial estimates for this ECP program?
Given the Cost Plus Incentive Fee structure and the long duration, comparing final costs to initial estimates is vital for assessing cost control effectiveness. Significant deviations could indicate poor planning, unforeseen challenges, or inadequate oversight. Understanding the variance helps determine if the incentive fee structure successfully managed costs or if the program exceeded expectations negatively.
What specific upgrades were included in this ECP, and how do they enhance military capabilities?
The effectiveness of this nearly $280 million investment hinges on the tangible improvements delivered by the Engineering Change Proposal. Understanding the specific technological advancements or performance enhancements to the armored vehicles is key. This allows for an assessment of whether the upgrades justify the cost and contribute meaningfully to the military's operational readiness and strategic objectives.
Industry Classification
NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W56HZV13RB019
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp
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: $566,532,164
Exercised Options: $279,847,165
Current Obligation: $279,847,165
Subaward Activity
Number of Subawards: 405
Total Subaward Amount: $358,405,054
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2013-11-25
Current End Date: 2022-02-28
Potential End Date: 2022-02-28 00:00:00
Last Modified: 2025-04-22
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