DoD awards $456M for Bradley Fighting Vehicle transmissions, with limited competition

Contract Overview

Contract Amount: $456,463,060 ($456.5M)

Contractor: L3 Technologies, Inc.

Awarding Agency: Department of Defense

Start Date: 2015-05-20

End Date: 2022-08-30

Contract Duration: 2,659 days

Daily Burn Rate: $171.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 63 EACH OF THE FOLLOWING HARDWARE ITEMS FOR THE BRADLEY FIGHTING VEHICLE SYSTEM (BFVS): THOR HMPT 800HP REMAN TRANSMISSION, NSN 2520-01-626-5061 TCM ELECTRONIC ASSEMBLY, NSN 2520-01-627-6468 SHIFT TOWER, NSN 2520-01-465-5184 TEC CABLE, NSN 6150-01-631-6134.

Place of Performance

Location: MUSKEGON, MUSKEGON County, MICHIGAN, 49442

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $456.5 million to L3 TECHNOLOGIES, INC. for work described as: 63 EACH OF THE FOLLOWING HARDWARE ITEMS FOR THE BRADLEY FIGHTING VEHICLE SYSTEM (BFVS): THOR HMPT 800HP REMAN TRANSMISSION, NSN 2520-01-626-5061 TCM ELECTRONIC ASSEMBLY, NSN 2520-01-627-6468 SHIFT TOWER, NSN 2520-01-465-5184 TEC CABLE, NSN 6150-01-631-6134. Key points: 1. Significant investment in critical BFVS components. 2. Sole source award to L3 Technologies raises competition concerns. 3. Long contract duration may impact price competitiveness. 4. High value contract for specialized vehicle parts.

Value Assessment

Rating: questionable

The total award of $456M for 63 units of various BFVS hardware, including transmissions, appears high. Without comparable contract data for these specific NSNs, it's difficult to benchmark the per-unit cost effectively against market rates or similar government procurements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded on a sole-source basis, indicating a lack of competitive bidding. This significantly limits price discovery and may lead to higher costs for the government compared to a fully competed procurement.

Taxpayer Impact: The absence of competition for this substantial contract likely results in a higher cost to taxpayers than if multiple vendors had been allowed to bid.

Public Impact

Ensures continued operational readiness of the Bradley Fighting Vehicle fleet. Supports the sustainment of a key Army armored vehicle platform. Potential for increased costs due to sole-source award impacts taxpayer funds. Reliability of BFVS is critical for troop safety and mission success.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
High contract value
Long contract duration

Positive Signals

Ensures availability of critical BFVS parts
Supports a key defense platform

Sector Analysis

This contract falls within the Defense sector, specifically focusing on the manufacturing and supply of specialized vehicle parts for armored vehicles. Spending benchmarks for such niche components are difficult to establish due to proprietary designs and limited suppliers.

Small Business Impact

The data indicates this contract was awarded to L3 Technologies, Inc., a large business. There is no indication of small business participation in this specific sole-source award, which is common for highly specialized defense components.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny from oversight bodies to ensure the government received fair value. A review of the justification for the sole-source award would be prudent to confirm necessity and explore future competitive opportunities.

Related Government Programs

Motor Vehicle Transmission and Power Train Parts Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award limits competition and potentially increases costs.
Lack of transparency regarding the justification for sole-sourcing.
High total contract value raises questions about cost-effectiveness.
Long contract duration may reduce flexibility and price negotiation leverage.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $456.5 million to L3 TECHNOLOGIES, INC.. 63 EACH OF THE FOLLOWING HARDWARE ITEMS FOR THE BRADLEY FIGHTING VEHICLE SYSTEM (BFVS): THOR HMPT 800HP REMAN TRANSMISSION, NSN 2520-01-626-5061 TCM ELECTRONIC ASSEMBLY, NSN 2520-01-627-6468 SHIFT TOWER, NSN 2520-01-465-5184 TEC CABLE, NSN 6150-01-631-6134.

Who is the contractor on this award?

The obligated recipient is L3 TECHNOLOGIES, 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 $456.5 million.

What is the period of performance?

Start: 2015-05-20. End: 2022-08-30.

What was the specific justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?

The justification for a sole-source award typically involves factors like unique capabilities, proprietary technology, or urgent needs where only one source can meet requirements. For this BFVS contract, the specific reason for sole-sourcing to L3 Technologies needs to be documented by the Department of the Army. Without this documentation, it's impossible to assess if alternative competitive strategies were adequately explored or if this was truly the only viable option.

How does the per-unit cost of these BFVS components compare to industry benchmarks or previous procurements of similar items?

Benchmarking the per-unit cost is challenging without access to detailed cost breakdowns or comparable contract data for these specific NSNs. The total award of $456M for 63 items suggests a high per-unit cost, but this could be attributed to the complexity and specialized nature of the components. A thorough cost analysis by the DoD would be necessary to determine if the pricing is reasonable and competitive.

What measures are in place to ensure the long-term availability and affordability of these critical BFVS parts, given the sole-source award?

Given the sole-source award, long-term availability and affordability depend heavily on the terms negotiated within the contract and the vendor's commitment. The DoD might explore strategies such as incentivizing L3 Technologies to develop alternative sources, negotiating long-term pricing agreements, or investing in government-owned technical data packages. Regular performance reviews and market research are crucial to mitigate risks associated with single-source reliance.

Industry Classification

NAICS: Manufacturing › Motor Vehicle Parts Manufacturing › Motor Vehicle Transmission and Power Train Parts Manufacturing

Product/Service Code: VEHICULAR EQUIPMENT COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W56HZV14R0035

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L3harris Technologies, Inc

Address: 76 GETTY ST, MUSKEGON, MI, 49442

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

Financial Breakdown

Contract Ceiling: $461,619,001

Exercised Options: $456,463,060

Current Obligation: $456,463,060

Actual Outlays: $34,590,102

Subaward Activity

Number of Subawards: 361

Total Subaward Amount: $74,076,281

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline