Department of the Army awards $76M for 415 ECP1 vehicles to LOC Performance Products LLC

Contract Overview

Contract Amount: $76,078,977 ($76.1M)

Contractor: LOC Performance Products LLC

Awarding Agency: Department of Defense

Start Date: 2020-11-13

End Date: 2024-02-28

Contract Duration: 1,202 days

Daily Burn Rate: $63.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: NEW DELIVERY ORDER TO BASE ONTO CONTRACT W56HZV-17-D-0078 FOR THE ORDER OF 415 ECP1 VEHICLES.

Place of Performance

Location: PLYMOUTH, WAYNE County, MICHIGAN, 48170

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $76.1 million to LOC PERFORMANCE PRODUCTS LLC for work described as: NEW DELIVERY ORDER TO BASE ONTO CONTRACT W56HZV-17-D-0078 FOR THE ORDER OF 415 ECP1 VEHICLES. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract is a delivery order against a base contract, indicating ongoing program support. 3. The firm fixed price structure shifts cost risk to the contractor. 4. The contract duration of 1202 days spans over three years, suggesting a significant program. 5. The primary product is Military Armored Vehicle, Tank, and Tank Component Manufacturing. 6. The award is for ECP1 vehicles, likely an upgrade or specific variant.

Value Assessment

Rating: good

The total award amount of $76,078,977.02 for 415 ECP1 vehicles translates to approximately $183,322 per vehicle. Benchmarking this against similar military vehicle procurements requires detailed cost breakdowns, but it appears within a reasonable range for specialized armored vehicles. The firm fixed price contract suggests the government has secured a defined cost, with the contractor bearing the risk of cost overruns. Further analysis would involve comparing the specific capabilities and features of the ECP1 vehicles to market alternatives and historical pricing for similar platforms.

Cost Per Unit: $183,322 per vehicle

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 specific number of bidders is not provided, but the designation suggests a robust competitive environment. Full and open competition generally leads to better price discovery and potentially lower costs for the government as contractors vie for the award. The use of this method for armored vehicle manufacturing implies that multiple companies possess the necessary capabilities and certifications.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices and a wider selection of qualified contractors, ensuring that the government receives the best value for its investment in critical defense equipment.

Public Impact

The primary beneficiaries are the U.S. Army personnel who will operate and utilize the ECP1 vehicles. The contract delivers essential military hardware, contributing to national defense capabilities. The geographic impact is primarily within the United States, where the vehicles will likely be deployed and maintained. The contract supports jobs within the defense manufacturing sector, specifically in armored vehicle production.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific bidder count limits assessment of competitive intensity.
Details on vehicle specifications and performance are not provided, hindering value assessment.
No information on sustainment or lifecycle costs associated with these vehicles.

Positive Signals

Awarded under firm fixed price, providing cost certainty.
Full and open competition suggests a competitive market.
Long contract duration indicates a sustained need and potential for follow-on work.

Sector Analysis

The defense manufacturing sector, particularly for armored vehicles, is a highly specialized and capital-intensive industry. This contract falls under the Military Armored Vehicle, Tank, and Tank Component Manufacturing category. The market is characterized by a few large prime contractors and a network of specialized suppliers. Spending in this area is driven by modernization efforts, operational readiness requirements, and evolving threat landscapes. Comparable spending benchmarks would involve analyzing other contracts for similar armored platforms procured by various branches of the U.S. military.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract, nor does it detail subcontracting plans. The prime contractor, LOC Performance Products LLC, is likely a mid-to-large-sized business given the contract value. The absence of explicit small business considerations in the award data suggests that opportunities for small businesses may arise through the prime contractor's supply chain, rather than through direct set-asides on this specific delivery order.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army contracting and program management offices. Accountability measures are embedded in the firm fixed price contract terms, requiring delivery of specified vehicles meeting technical requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Tactical Wheeled Vehicles
Armored Fighting Vehicles
Combat Vehicles
Military Vehicle Procurement
Defense Contracts Management Agency

Risk Flags

Potential for delivery delays impacting operational readiness.
Risk of technical performance not meeting evolving military requirements.
Dependence on a single contractor for a critical component of vehicle fleet.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $76.1 million to LOC PERFORMANCE PRODUCTS LLC. NEW DELIVERY ORDER TO BASE ONTO CONTRACT W56HZV-17-D-0078 FOR THE ORDER OF 415 ECP1 VEHICLES.

Who is the contractor on this award?

The obligated recipient is LOC PERFORMANCE PRODUCTS 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 $76.1 million.

What is the period of performance?

Start: 2020-11-13. End: 2024-02-28.

What is the track record of LOC Performance Products LLC in fulfilling government contracts, particularly for armored vehicles?

A review of publicly available contract data indicates that LOC Performance Products LLC has a history of receiving contracts from the Department of Defense, primarily related to vehicle manufacturing and components. While specific details on past performance for armored vehicles like the ECP1 are not detailed in this award notice, their selection suggests they have met the necessary qualifications and demonstrated capability. Further investigation into their contract history, including past performance evaluations and any reported issues on previous awards, would provide a more comprehensive understanding of their reliability and expertise in delivering complex military hardware.

How does the per-unit cost of $183,322 for the ECP1 vehicles compare to similar armored vehicle procurements?

The per-unit cost of approximately $183,322 for the ECP1 vehicles needs to be contextualized by the specific capabilities, protection levels, and intended roles of these vehicles. Armored vehicles vary significantly in complexity and cost. For instance, a basic armored personnel carrier might cost less, while a main battle tank or a highly specialized reconnaissance vehicle could cost substantially more. Without detailed specifications of the ECP1, direct comparison is challenging. However, this figure appears to be within the expected range for modern, medium-weight armored platforms designed for specific military roles, especially when considering research, development, and specialized manufacturing costs.

What are the primary risks associated with this contract for the Department of the Army?

The primary risks for the Department of the Army in this contract revolve around potential performance issues, delivery delays, and ensuring the ECP1 vehicles meet all specified technical and operational requirements. Although the firm fixed price contract shifts financial risk to the contractor, the government still bears the risk of receiving a product that may not fully meet its needs or is delivered late, impacting operational readiness. Technical risks include potential design flaws or integration issues with existing military systems. Furthermore, the long duration of the contract increases the exposure to potential changes in military requirements or budget constraints that could affect the program's continuation.

What is the historical spending pattern for Military Armored Vehicle, Tank, and Tank Component Manufacturing by the Department of the Army?

Historical spending patterns for Military Armored Vehicle, Tank, and Tank Component Manufacturing by the Department of the Army are substantial, reflecting the ongoing need for modernization and replacement of aging fleets. Annual expenditures in this category can fluctuate significantly based on major procurement programs, upgrades, and sustainment contracts. While specific aggregate figures for this PSC code are not provided here, the Army consistently invests billions of dollars in ground vehicle systems. This contract represents a portion of that ongoing investment, likely tied to a specific vehicle program or upgrade initiative rather than a broad category-wide procurement.

What are the implications of this contract being a delivery order against a base contract?

This contract being a delivery order against a base contract (W56HZV-17-D-0078) implies that a foundational agreement for the procurement of ECP1 vehicles or related services was previously established, likely through a competitive process. The base contract would have outlined general terms, conditions, and potentially pricing structures. This delivery order then specifies the quantity (415 vehicles), delivery schedule, and final price for a particular tranche of work. This approach allows the government to procure items incrementally as needed, providing flexibility while leveraging the pre-negotiated terms of the base contract, potentially streamlining the acquisition process for subsequent orders.

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: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 13505 N HAGGERTY RD, PLYMOUTH, MI, 48170

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

Financial Breakdown

Contract Ceiling: $76,078,977

Exercised Options: $76,078,977

Current Obligation: $76,078,977

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W56HZV17D0078

IDV Type: IDC

Timeline