DoD awards $220M for armored vehicle parts, with no competition
Contract Overview
Contract Amount: $220,190,873 ($220.2M)
Contractor: General Dynamics Land Systems Inc.
Awarding Agency: Department of Defense
Start Date: 2020-03-01
End Date: 2022-02-22
Contract Duration: 723 days
Daily Burn Rate: $304.6K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: CALL-UP OF ORDER PERIOD 2 (FY 20 WHOLESALE SUPPLY) TASK ORDER. THE CONTRACTOR IS TO PROVIDE THE PARTS SUPPORT AS DESCRIBED IN THE BASE CONTRACT.
Place of Performance
Location: STERLING HEIGHTS, MACOMB County, MICHIGAN, 48310
State: Michigan Government Spending
Plain-Language Summary
Department of Defense obligated $220.2 million to GENERAL DYNAMICS LAND SYSTEMS INC. for work described as: CALL-UP OF ORDER PERIOD 2 (FY 20 WHOLESALE SUPPLY) TASK ORDER. THE CONTRACTOR IS TO PROVIDE THE PARTS SUPPORT AS DESCRIBED IN THE BASE CONTRACT. Key points: 1. Significant contract value of $220M for essential parts support. 2. Sole-source award to General Dynamics Land Systems Inc. raises competition concerns. 3. Risk of inflated pricing due to lack of competitive bidding. 4. Spending falls within the 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' sector.
Value Assessment
Rating: questionable
The $220M award for parts support lacks a competitive benchmark. Without competition, it's difficult to assess if the pricing is fair compared to potential market alternatives.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This was a sole-source award, meaning no other vendors were considered. This significantly limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for these critical parts.
Public Impact
Ensures continued availability of parts for military armored vehicles. Potential for higher costs due to sole-source nature of the award. Impacts the readiness and operational capability of armored vehicle fleets.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competitive bidding
- Potential for cost overruns
Positive Signals
- Ensures critical parts availability
- Supports existing military hardware
Sector Analysis
This contract falls under the 'Military Armored Vehicle, Tank, and Tank Component Manufacturing' sector. Spending in this area is critical for national defense, but competitive sourcing is vital to ensure cost-effectiveness.
Small Business Impact
The data indicates this contract was not awarded to small businesses. Further analysis would be needed to determine if small businesses could have participated in a competitive bidding process.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny. Oversight should focus on ensuring the contractor is providing parts at a reasonable cost, even without competition.
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
- Lack of competition
- Potential for price inflation
- Limited transparency in pricing
- No small business participation noted
Tags
military-armored-vehicle-tank-and-tank-c, department-of-defense, mi, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $220.2 million to GENERAL DYNAMICS LAND SYSTEMS INC.. CALL-UP OF ORDER PERIOD 2 (FY 20 WHOLESALE SUPPLY) TASK ORDER. THE CONTRACTOR IS TO PROVIDE THE PARTS SUPPORT AS DESCRIBED IN THE BASE CONTRACT.
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 $220.2 million.
What is the period of performance?
Start: 2020-03-01. End: 2022-02-22.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one vendor can fulfill the requirement. Without specific documentation, it's difficult to ascertain the precise reason, but it necessitates careful review to ensure it aligns with federal procurement regulations and truly serves the government's best interest.
How will the government ensure cost-effectiveness without competitive pressure?
The government can employ several strategies to ensure cost-effectiveness in sole-source contracts. This includes rigorous negotiation, detailed cost analysis, benchmarking against similar historical contracts or commercial prices, and potentially incorporating performance-based incentives. Regular audits and reviews of contractor expenditures are also crucial to identify any potential inefficiencies or unjustified price increases.
What is the long-term impact of relying on sole-source contracts for critical components?
Long-term reliance on sole-source contracts can stifle innovation, reduce market competition, and potentially lead to higher sustained costs. It can also create dependency on a single supplier, increasing vulnerability if that supplier faces disruptions. Encouraging competition where feasible and exploring alternative sourcing strategies are important for long-term cost control and supply chain resilience.
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
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: $220,190,873
Exercised Options: $220,190,873
Current Obligation: $220,190,873
Subaward Activity
Number of Subawards: 133
Total Subaward Amount: $102,930,733
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W56HZV19D0054
IDV Type: IDC
Timeline
Start Date: 2020-03-01
Current End Date: 2022-02-22
Potential End Date: 2022-02-22 12:02:00
Last Modified: 2025-09-29
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