DoD's $24.8M contract for fire control electronics repair awarded to General Dynamics Land Systems Inc

Contract Overview

Contract Amount: $24,766,267 ($24.8M)

Contractor: General Dynamics Land Systems Inc.

Awarding Agency: Department of Defense

Start Date: 2018-12-20

End Date: 2025-08-31

Contract Duration: 2,446 days

Daily Burn Rate: $10.1K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: REPAIR AND MAINTENANCE SERVICES OF IMPROVED FIRE CONTROL ELECTRONICS UNITS (IFCEU) AND IMPROVED COMMANDERS DISPLAY UNIT (ICDU).

Place of Performance

Location: STERLING HEIGHTS, MACOMB County, MICHIGAN, 48310

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $24.8 million to GENERAL DYNAMICS LAND SYSTEMS INC. for work described as: REPAIR AND MAINTENANCE SERVICES OF IMPROVED FIRE CONTROL ELECTRONICS UNITS (IFCEU) AND IMPROVED COMMANDERS DISPLAY UNIT (ICDU). Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns if not managed carefully. 2. The contract was not competed, raising questions about potential price discovery and value for money. 3. A significant duration of over 2000 days suggests a long-term need for these services. 4. The specific nature of 'fire control electronics' points to a critical defense capability. 5. The awardee, General Dynamics Land Systems Inc., is a major defense contractor with extensive experience in this sector.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the scope of work and the number of units requiring repair. However, the cost-plus-fixed-fee structure warrants careful monitoring to ensure costs remain within reasonable bounds. Comparing this to similar contracts for military electronics repair would provide a clearer picture of its value proposition. The lack of competition also limits the ability to assess if the fixed fee is competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other potential vendors. This approach is typically used when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition means that the government did not benefit from a bidding process that could have driven down prices or fostered innovation among multiple suppliers.

Taxpayer Impact: Taxpayers may not have received the best possible price due to the absence of competitive bidding. This could result in higher overall costs for the repair and maintenance of these critical defense systems.

Public Impact

The primary beneficiaries are the U.S. Army units relying on functional fire control electronics for their armored vehicles. Services delivered include the repair and maintenance of Improved Fire Control Electronics Units (IFCEU) and Improved Commanders Display Units (ICDU). The geographic impact is likely concentrated where these specific armored vehicles are deployed or maintained. This contract supports specialized technical roles within the defense industrial base, potentially sustaining jobs in engineering and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus-fixed-fee contracts require robust oversight to prevent cost escalation.
Sole-source awards can limit opportunities for emerging or smaller specialized firms.

Positive Signals

Awardee is a well-established prime contractor with a strong track record in defense systems.
Contract addresses a critical operational need for the U.S. Army's armored vehicle fleet.
Long contract duration suggests a stable, ongoing requirement and potential for sustained support.

Sector Analysis

This contract falls within the broader defense electronics and military vehicle maintenance sector. The market for specialized repair and maintenance of military hardware is dominated by large, established defense contractors like General Dynamics. Spending in this area is driven by the need to maintain the operational readiness of aging and advanced military platforms, with significant government investment allocated annually to sustain these complex systems.

Small Business Impact

The contract data indicates no specific small business set-aside. Given the sole-source nature and the prime contractor's size, it is unlikely that significant subcontracting opportunities for small businesses will be mandated or readily available unless the prime contractor proactively seeks them out. This contract does not appear to directly benefit the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures would be tied to the performance metrics outlined in the contract and the fixed-fee structure. Transparency may be limited due to the sole-source nature, but contract awards and basic details are typically available through federal procurement databases.

Related Government Programs

Military Vehicle Maintenance
Defense Electronics Repair
Army Combat Systems Support
Fire Control Systems

Risk Flags

Sole-source award limits price competition.
Cost-plus-fixed-fee contract requires diligent cost oversight.
Lack of public detail on specific repair scope hinders value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.8 million to GENERAL DYNAMICS LAND SYSTEMS INC.. REPAIR AND MAINTENANCE SERVICES OF IMPROVED FIRE CONTROL ELECTRONICS UNITS (IFCEU) AND IMPROVED COMMANDERS DISPLAY UNIT (ICDU).

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 $24.8 million.

What is the period of performance?

Start: 2018-12-20. End: 2025-08-31.

What is the historical spending pattern for repair and maintenance of fire control electronics by the Department of the Army?

Historical spending on fire control electronics repair and maintenance by the Department of the Army can be substantial, reflecting the complexity and critical nature of these systems. While specific figures for 'fire control electronics' alone are difficult to isolate without detailed category analysis, the Army consistently invests billions annually in the maintenance, repair, and upgrade of its vast fleet of combat vehicles and associated systems. Contracts for such services often span multiple years and can range from millions to hundreds of millions of dollars, depending on the scope, number of units, and technological sophistication. The trend generally shows a sustained need for these services, driven by the operational tempo, aging equipment, and the introduction of new technologies requiring specialized support.

What is General Dynamics Land Systems Inc.'s track record with similar sole-source contracts for military electronics?

General Dynamics Land Systems Inc. (GDLS) has a long and extensive track record as a prime contractor for the U.S. military, particularly in the area of armored vehicle production and sustainment. They frequently engage in sole-source or limited-competition contracts for specialized repair, maintenance, and upgrade services on platforms like the Abrams tank and Stryker vehicle. Their history includes numerous contracts for complex systems, including fire control, power systems, and vehicle electronics. While GDLS is a reputable and experienced entity, the nature of sole-source awards means that direct comparisons of pricing or value against competitive bids are not publicly available. Oversight and performance reviews by the Department of Defense are crucial for ensuring value and quality in these arrangements.

How does the cost-plus-fixed-fee (CPFF) contract type typically impact the final cost compared to other contract types for defense electronics repair?

The Cost-Plus-Fixed-Fee (CPFF) contract type is often used when the scope of work is not precisely defined or when there is a high degree of uncertainty in the costs involved, such as in research and development or complex repair scenarios. In a CPFF contract, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure incentivizes the contractor to control costs, as the fee remains constant regardless of the actual costs incurred. However, it can still lead to higher final costs compared to fixed-price contracts if the initial cost estimates are inaccurate or if unforeseen issues drive up the allowable costs significantly. Robust government oversight is essential to scrutinize incurred costs and ensure they are reasonable and allocable to the contract.

What are the potential risks associated with a sole-source award for critical defense electronics maintenance?

The primary risk associated with a sole-source award for critical defense electronics maintenance is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the government may not achieve the most favorable pricing. Another risk is a potential decline in service quality or innovation over time, as the contractor may face less pressure to improve efficiency or adopt new technologies if they are the only provider. Furthermore, sole-source awards can create vendor lock-in, making it difficult and costly to switch providers in the future, even if performance issues arise. This can also limit opportunities for smaller, innovative companies to enter the market and provide alternative solutions.

What is the significance of 'Improved Fire Control Electronics Units (IFCEU)' and 'Improved Commanders Display Unit (ICDU)' in military operations?

The Improved Fire Control Electronics Units (IFCEU) and Improved Commanders Display Units (ICDU) are critical components of a military vehicle's combat system. The IFCEU is responsible for processing targeting data, calculating firing solutions, and directing the weapon system, ensuring accuracy and effectiveness in engaging targets. The ICDU provides the commander with essential situational awareness, target information, and control over the vehicle's weapon systems. Improvements to these units typically enhance targeting precision, reduce engagement times, improve reliability, and integrate advanced battlefield management capabilities. The proper functioning and maintenance of these systems are paramount for the operational effectiveness and survivability of armored units on the battlefield.

Industry Classification

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

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 38500 MOUND RD, STERLING HEIGHTS, MI, 48310

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

Financial Breakdown

Contract Ceiling: $24,766,267

Exercised Options: $24,766,267

Current Obligation: $24,766,267

Actual Outlays: $3,763,362

Subaward Activity

Number of Subawards: 18

Total Subaward Amount: $9,941,088

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56HZV17D0089

IDV Type: IDC

Timeline