DoD awards $61.4M for OMFV Phase 2 concept design to General Dynamics Land Systems

Contract Overview

Contract Amount: $61,370,079 ($61.4M)

Contractor: General Dynamics Land Systems Inc.

Awarding Agency: Department of Defense

Start Date: 2021-07-23

End Date: 2022-12-31

Contract Duration: 526 days

Daily Burn Rate: $116.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: OMFV PHASE 2 CONCEPT DESIGN EFFORT

Place of Performance

Location: STERLING HEIGHTS, MACOMB County, MICHIGAN, 48310

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $61.4 million to GENERAL DYNAMICS LAND SYSTEMS INC. for work described as: OMFV PHASE 2 CONCEPT DESIGN EFFORT Key points: 1. Contract awarded via full and open competition, suggesting a robust bidding process. 2. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 3. Duration of 526 days indicates a substantial, multi-year effort for concept development. 4. The award is for the Optionally Manned Fighting Vehicle (OMFV) program, a critical modernization initiative. 5. General Dynamics Land Systems is a major defense contractor with extensive experience in armored vehicle manufacturing. 6. The specific Product Service Code (PSC) is missing, limiting detailed analysis of the services procured. 7. The contract value of $61.4 million is significant for a concept design phase.

Value Assessment

Rating: good

The contract value of $61.4 million for a concept design phase appears reasonable given the complexity of developing a next-generation fighting vehicle. Benchmarking against similar large-scale defense development contracts suggests this is within expected parameters. The Firm Fixed Price (FFP) structure is generally favorable for the government as it caps costs, provided the initial scope is well-defined. Without more granular data on the specific deliverables and labor categories, a precise value-for-money assessment is challenging, but the competitive award process provides some assurance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 6 bidders (no=6) suggests a healthy level of competition for this significant defense program. A competitive process like this typically leads to better price discovery and potentially more innovative solutions as contractors vie for the award. The government received multiple proposals, allowing for comparison and selection of the best value.

Taxpayer Impact: A competitive award process for a program of this magnitude is beneficial for taxpayers as it helps ensure the government obtains the best possible solution at a fair price, minimizing the risk of overpayment.

Public Impact

The primary beneficiaries are the U.S. Army, which will receive advanced concept designs for a future fighting vehicle. This contract supports the modernization of ground combat capabilities, enhancing soldier protection and battlefield effectiveness. The geographic impact is primarily within the defense industrial base, potentially involving engineering and manufacturing facilities across the country. Workforce implications include highly skilled engineers, designers, and program managers within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope of concept design expands beyond initial estimates.
Dependence on a single large contractor for a critical program element could pose future supply chain risks.
The complexity of the OMFV program itself presents inherent technical and schedule risks.

Positive Signals

Awarded through full and open competition, maximizing the potential for competitive pricing and innovation.
Firm Fixed Price contract type transfers cost risk to the contractor.
General Dynamics Land Systems has a proven track record in developing and producing armored vehicles.
The contract supports a high-priority Army modernization effort.

Sector Analysis

The Optionally Manned Fighting Vehicle (OMFV) program falls within the broader defense sector, specifically focusing on armored vehicle manufacturing and modernization. This market is characterized by large, established defense contractors with significant R&D capabilities. The OMFV represents a substantial investment in replacing legacy platforms and integrating new technologies like unmanned operation and advanced lethality. Spending in this sub-sector is driven by geopolitical threats and the need to maintain technological superiority.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses. Given the scale and technical complexity of the OMFV program, it is likely that General Dynamics Land Systems will engage large subcontractors. However, there may be opportunities for small businesses to participate indirectly through subcontracting, depending on the specific needs and sourcing strategies of the prime contractor.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army contracting and program management offices. Accountability measures are inherent in the Firm Fixed Price contract structure, requiring the contractor to meet defined milestones and deliverables. Transparency is generally maintained through contract award databases and reporting requirements, although specific details of the concept design itself may be sensitive. The Inspector General's office could investigate any allegations of fraud, waste, or abuse.

Related Government Programs

Ground Combat Vehicle (GCV) Program (previous iteration)
Bradley Fighting Vehicle Modernization
Next Generation Combat Vehicle (NGCV) Program
Armored Multi-Purpose Vehicle (AMPV)

Risk Flags

Potential for schedule delays due to program complexity.
Risk of cost growth if requirements evolve significantly.
Technical challenges associated with 'optionally manned' capabilities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $61.4 million to GENERAL DYNAMICS LAND SYSTEMS INC.. OMFV PHASE 2 CONCEPT DESIGN EFFORT

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 $61.4 million.

What is the period of performance?

Start: 2021-07-23. End: 2022-12-31.

What is the track record of General Dynamics Land Systems (GDLS) in delivering complex armored vehicle programs on time and within budget?

General Dynamics Land Systems has a long and extensive track record in developing and producing armored vehicles for the U.S. military and international partners. They were the prime contractor for the Abrams Main Battle Tank and have been involved in numerous upgrades and variants. GDLS has also been a key player in programs like the Stryker family of vehicles. While they have a history of successful large-scale production, like many major defense contractors, they have also faced challenges with schedule delays and cost growth on complex development programs. For instance, the Abrams program has seen continuous upgrades over decades, demonstrating sustained capability but also evolving costs. Their performance on the OMFV Phase 2 concept design will be crucial in setting the stage for future phases, and their ability to manage this initial phase effectively will be a key indicator of future success.

How does the $61.4 million award for OMFV Phase 2 concept design compare to similar defense development contracts?

The $61.4 million award for the OMFV Phase 2 concept design effort is substantial for an initial development phase, but it is not unusual for programs of this strategic importance and technical complexity within the Department of Defense. For comparison, early concept and technology development phases for major weapon systems, such as new aircraft or missile systems, can range from tens to hundreds of millions of dollars. The Optionally Manned Fighting Vehicle is intended to be a transformative platform, requiring significant investment in research, design, and prototyping. Given the number of bidders (6) and the competitive nature of the award, the price appears to reflect the market's assessment of the effort required. It is important to note that this is just the initial concept design phase, and subsequent phases involving prototyping, testing, and production will involve significantly larger expenditures.

What are the primary risks associated with the OMFV program at this concept design stage?

At the concept design stage for the OMFV program, the primary risks include technical feasibility, integration challenges, and potential scope creep. Ensuring that the proposed concepts can be realized with emerging or mature technologies, and that these technologies can be effectively integrated into a cohesive system, is a significant technical hurdle. There's also the risk that the requirements or desired capabilities might evolve as the program progresses, leading to scope creep and increased costs. Furthermore, the 'optionally manned' aspect introduces complexity in human-machine interface design and operational concepts. Schedule risks are also present, as early design decisions can impact the timeline for subsequent phases. Finally, ensuring adequate competition and cost control throughout the program lifecycle remains a constant risk.

What is the historical spending pattern for programs aimed at replacing or significantly upgrading infantry fighting vehicles?

Historical spending patterns for programs aimed at replacing or significantly upgrading infantry fighting vehicles (IFVs) within the U.S. military demonstrate a consistent and substantial investment. Programs like the Bradley Fighting Vehicle's various upgrades, the failed Ground Combat Vehicle (GCV) program, and now the OMFV initiative, have collectively represented billions of dollars in research, development, testing, and procurement over several decades. Early concept and technology development phases, similar to OMFV Phase 2, typically consume tens to hundreds of millions of dollars. Full-scale development and prototyping phases escalate costs significantly, often reaching hundreds of millions to over a billion dollars. Finally, procurement of new IFVs can cost tens of billions of dollars over the life of the program, with individual vehicles costing several million dollars each depending on the configuration and technology. This consistent, high-level investment underscores the strategic importance placed on maintaining a modern and capable ground combat fleet.

How does the 'optionally manned' capability requirement impact the program's complexity and cost?

The 'optionally manned' capability requirement significantly increases the complexity and potential cost of the OMFV program compared to traditional manned fighting vehicles. This feature implies the vehicle must be designed to operate autonomously or with a reduced crew, requiring sophisticated artificial intelligence (AI), advanced sensor suites, robust communication systems, and reliable remote operation capabilities. Developing and integrating these AI and autonomous systems involves substantial R&D investment and rigorous testing to ensure safety and effectiveness. The human-machine interface for both manned and remote operation needs careful design. Furthermore, cybersecurity becomes a paramount concern to protect against remote hijacking or interference. This added layer of technological sophistication necessitates specialized expertise, potentially longer development timelines, and higher overall program costs throughout its lifecycle, from design to sustainment.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W56HZV20R0142

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

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, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $61,370,079

Exercised Options: $61,370,079

Current Obligation: $61,370,079

Subaward Activity

Number of Subawards: 12

Total Subaward Amount: $7,063,509

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline