DoD Awards $32.4M for 100 HMMWVs and Parts to AM General LLC for Lebanon
Contract Overview
Contract Amount: $32,392,255 ($32.4M)
Contractor: AM General LLC
Awarding Agency: Department of Defense
Start Date: 2018-09-13
End Date: 2021-02-26
Contract Duration: 897 days
Daily Burn Rate: $36.1K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: M1151A1B1 HMMWVS, 100 EACH AND CONTRACTOR UNIQUE SPARE PARTS PACKAGE FOR 3 YEARS FOR LEBANON, FMS CASE 7C-B-UWZ
Place of Performance
Location: SOUTH BEND, ST JOSEPH County, INDIANA, 46617
State: Indiana Government Spending
Plain-Language Summary
Department of Defense obligated $32.4 million to AM GENERAL LLC for work described as: M1151A1B1 HMMWVS, 100 EACH AND CONTRACTOR UNIQUE SPARE PARTS PACKAGE FOR 3 YEARS FOR LEBANON, FMS CASE 7C-B-UWZ Key points: 1. High value contract for specialized military vehicles and long-term parts support. 2. Sole-source award to AM General LLC, a known manufacturer of HMMWVs. 3. Potential risk associated with sole-source procurement and long-term sustainment. 4. Spending falls within the Defense sector, specifically armored vehicle manufacturing.
Value Assessment
Rating: fair
The $32.4 million contract price for 100 HMMWVs and 3 years of parts appears high, especially considering the unit price. Benchmarking against similar FMS sales or domestic procurements would be necessary for a definitive assessment.
Cost Per Unit: $323,922 per HMMWV (base vehicle cost not isolated)
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to AM General LLC. This limits price discovery and potentially leads to higher costs for taxpayers, as competition is absent.
Taxpayer Impact: The lack of competition in this sole-source award may result in higher costs for U.S. taxpayers compared to a competitively procured contract.
Public Impact
Ensures continued operational capability for allied forces through provision of essential vehicles. Supports U.S. foreign military sales objectives and defense diplomacy. Potential for long-term sustainment and readiness for Lebanese forces.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award lacks competition
- Potential for overpricing without competitive bidding
- Long-term parts commitment requires careful management
Positive Signals
- Supports critical foreign military sales objectives
- Provides essential equipment to an allied nation
- Ensures vehicle readiness with parts package
Sector Analysis
This contract falls under the Defense sector, specifically the manufacturing of military armored vehicles. Spending benchmarks for similar HMMWV procurements, especially for foreign military sales, would provide further context on cost-effectiveness.
Small Business Impact
The award was made directly to AM General LLC, a large prime contractor. There is no indication of subcontracting opportunities for small businesses within this specific contract data.
Oversight & Accountability
Oversight would focus on contract performance, delivery schedules, and the justification for the sole-source award. Ensuring fair pricing and adherence to FMS program requirements are key accountability areas.
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 limits competition
- Potential for inflated pricing
- Long-term parts commitment risks
- Lack of transparency in price discovery
Tags
military-armored-vehicle-tank-and-tank-c, department-of-defense, in, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $32.4 million to AM GENERAL LLC. M1151A1B1 HMMWVS, 100 EACH AND CONTRACTOR UNIQUE SPARE PARTS PACKAGE FOR 3 YEARS FOR LEBANON, FMS CASE 7C-B-UWZ
Who is the contractor on this award?
The obligated recipient is AM GENERAL LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $32.4 million.
What is the period of performance?
Start: 2018-09-13. End: 2021-02-26.
What is the justification for the sole-source award, and has a full and open competition been thoroughly explored?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent requirements where only one source can fulfill the need. For this contract, the rationale behind not competing the award needs to be documented and reviewed to ensure it aligns with federal acquisition regulations and promotes best value for the government.
How does the per-unit cost of these HMMWVs compare to similar vehicles procured domestically or through other FMS cases?
A comparative analysis of the per-unit cost against similar HMMWV variants or comparable armored vehicles procured by the U.S. military or other allied nations is crucial. Without this benchmark, it's difficult to ascertain if the $323,922 figure represents a fair and reasonable price, especially given the sole-source nature of the award.
What mechanisms are in place to ensure the long-term availability and cost-effectiveness of the contractor-unique spare parts package over three years?
Effective management of the three-year spare parts package requires clear performance metrics, potential price caps, and regular reviews of parts usage and pricing. Ensuring AM General LLC provides these parts at a reasonable cost and maintains adequate inventory levels is vital to prevent future cost overruns and sustainment issues.
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 COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: KPS Capital Partners, LP
Address: 105 N NILES AVE, SOUTH BEND, IN, 46617
Business Categories: Category Business, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $32,392,255
Exercised Options: $32,392,255
Current Obligation: $32,392,255
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W56HZV17D0071
IDV Type: IDC
Timeline
Start Date: 2018-09-13
Current End Date: 2021-02-26
Potential End Date: 2021-02-26 00:00:00
Last Modified: 2025-04-24
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