DoD awards $675.7M for Optionally Manned Fighting Vehicle development, with General Dynamics leading Phase 3 & 4

Contract Overview

Contract Amount: $675,677,812 ($675.7M)

Contractor: General Dynamics Land Systems Inc.

Awarding Agency: Department of Defense

Start Date: 2023-06-26

End Date: 2027-12-25

Contract Duration: 1,643 days

Daily Burn Rate: $411.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 99

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: PHASE 3 AND 4 DEVELOPMENT WITH 7 PROTOTYPE DELIVERABLES OF THE OPTIONALLY MANNED FIGHTING VEHICLE.

Place of Performance

Location: STERLING HEIGHTS, MACOMB County, MICHIGAN, 48310

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $675.7 million to GENERAL DYNAMICS LAND SYSTEMS INC. for work described as: PHASE 3 AND 4 DEVELOPMENT WITH 7 PROTOTYPE DELIVERABLES OF THE OPTIONALLY MANNED FIGHTING VEHICLE. Key points: 1. Contract focuses on advanced prototype development for a next-generation combat vehicle. 2. Significant investment in military modernization and technological superiority. 3. High value contract indicates a critical program for the Army's future force structure. 4. Fixed-price contract structure aims to control costs and incentivize contractor performance. 5. Competition was robust, suggesting potential for competitive pricing and innovation. 6. Program duration extends over four years, indicating a complex and lengthy development cycle.

Value Assessment

Rating: good

The contract value of $675.7 million for Phase 3 and 4 development, including 7 prototype deliverables, appears substantial for advanced military vehicle prototyping. Benchmarking against similar large-scale defense development contracts suggests this is within a typical range for programs of this complexity and strategic importance. The firm fixed-price structure provides cost certainty for the government, though the ultimate value will depend on the successful delivery of the prototypes and their performance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple capable vendors were invited to bid. The presence of 99 potential bidders suggests a healthy competitive environment for this type of advanced military hardware. A broad base of competition generally leads to better price discovery and encourages innovation as contractors vie for the award.

Taxpayer Impact: Full and open competition ensures that taxpayer dollars are used efficiently by fostering a market where the best value is sought, rather than being limited to a single provider.

Public Impact

The U.S. Army benefits from the development of advanced combat vehicle technology. The program delivers 7 prototype deliverables for the Optionally Manned Fighting Vehicle. The contract supports advanced manufacturing and engineering jobs, primarily in Michigan. This initiative enhances the U.S. military's ground combat capabilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long development cycles in defense can lead to cost overruns if not managed tightly.
Technological risks associated with developing cutting-edge military hardware.
Potential for scope creep if program requirements evolve significantly during development.

Positive Signals

Firm fixed-price contract provides cost control and predictability.
Full and open competition suggests a strong market offering competitive solutions.
Award to an established defense contractor with a track record in vehicle manufacturing.

Sector Analysis

This contract falls within the defense industrial base, specifically the manufacturing of military armored vehicles. The market for such systems is characterized by high barriers to entry due to technological complexity, stringent quality requirements, and significant R&D investment. Spending in this sector is driven by national security priorities and the need for continuous modernization of military platforms. Comparable spending benchmarks would involve other major defense platform development programs.

Small Business Impact

While this contract was awarded to a large prime contractor, General Dynamics Land Systems Inc., the implications for small businesses are not immediately clear from the provided data. Large defense contracts often involve extensive subcontracting opportunities. It is crucial to assess the prime contractor's subcontracting plan to ensure small businesses, including those in specialized manufacturing or technology niches, have opportunities to participate and contribute to the program's success.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army's contracting and program management offices. The firm fixed-price nature of the contract provides a degree of cost accountability. Transparency is typically maintained through contract reporting requirements and potential reviews by the Government Accountability Office (GAO) or the Department of Defense's Inspector General, particularly concerning performance and adherence to specifications.

Related Government Programs

Future Vertical Lift Program
Ground Combat Vehicle Program
Armored Multi-Purpose Vehicle (AMPV)
Bradley Fighting Vehicle Modernization

Risk Flags

Potential for schedule delays in advanced technology development.
Risk of cost escalation if unforeseen technical challenges arise.
Ensuring successful integration of autonomous and manned operational modes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $675.7 million to GENERAL DYNAMICS LAND SYSTEMS INC.. PHASE 3 AND 4 DEVELOPMENT WITH 7 PROTOTYPE DELIVERABLES OF THE OPTIONALLY MANNED FIGHTING VEHICLE.

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 $675.7 million.

What is the period of performance?

Start: 2023-06-26. End: 2027-12-25.

What is General Dynamics Land Systems' track record with similar large-scale defense vehicle development contracts?

General Dynamics Land Systems (GDLS) has a long and extensive history in developing and manufacturing armored vehicles for the U.S. military and international partners. They are the prime contractor for the Abrams Main Battle Tank and the Stryker family of vehicles, both of which have undergone numerous upgrades and variants. Their experience includes managing complex development cycles, integrating advanced technologies, and meeting stringent performance requirements. GDLS has also been involved in previous efforts to develop next-generation ground combat vehicles, indicating a deep understanding of the challenges and opportunities inherent in programs like the Optionally Manned Fighting Vehicle (OMFV).

How does the $675.7 million development cost compare to previous military vehicle prototyping efforts?

The $675.7 million allocated for Phase 3 and 4 development of the OMFV, encompassing 7 prototype deliverables, is a significant investment. Historically, major defense platform development programs, especially those involving entirely new vehicle architectures and advanced technologies like optional manning and modularity, can range from hundreds of millions to billions of dollars. For instance, the early development phases of programs like the Ground Combat Vehicle (GCV) initiative, which was later canceled, involved substantial funding. The current value appears consistent with the scale and complexity of developing a technologically advanced fighting vehicle intended to replace or augment existing platforms, reflecting the high R&D costs associated with cutting-edge military hardware.

What are the primary technical and programmatic risks associated with this OMFV development contract?

The primary technical risks involve the successful integration of advanced technologies, such as autonomous capabilities, sophisticated sensor suites, and potentially novel propulsion or protection systems, within the Optionally Manned Fighting Vehicle. Ensuring these systems function reliably and cohesively under demanding combat conditions is a significant challenge. Programmatic risks include potential schedule delays due to the complexity of development and testing, cost overruns if unforeseen technical hurdles arise or if requirements evolve, and the risk of the prototypes not meeting the Army's evolving operational requirements. Furthermore, ensuring effective human-machine teaming for the optionally manned aspect presents unique human factors and interface design challenges.

How will the success of these prototypes be measured, and what are the implications for future production?

The success of the OMFV prototypes will be measured against a defined set of technical performance specifications, operational requirements, and key performance parameters outlined in the contract. This typically includes assessments of lethality, mobility, survivability, network integration, and the effectiveness of the optionally manned capabilities. Rigorous testing and evaluation phases will be conducted by the Army to validate these aspects. Successful prototype completion and validation are critical prerequisites for the program to move into subsequent phases, potentially including low-rate initial production (LRIP) and full-rate production. Failure to meet key requirements could lead to program re-evaluation, modification, or even termination.

What is the historical spending trend for military armored vehicle manufacturing and development within the Department of Defense?

Spending on military armored vehicle manufacturing and development within the Department of Defense has historically been substantial, driven by the need to maintain technological superiority and replace aging fleets. This spending fluctuates based on geopolitical conditions, strategic priorities, and the lifecycle of existing platforms. Major procurement and development programs for tanks, infantry fighting vehicles, and armored personnel carriers represent significant portions of the Army's budget. Trends show a consistent need for modernization, often involving upgrades to existing platforms and the development of new ones to incorporate advancements in areas like protection, firepower, mobility, and network connectivity. The OMFV program aligns with this ongoing investment in ground combat modernization.

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

Solicitation ID: W56HZV22R0026

Offers Received: 99

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: $770,231,590

Exercised Options: $675,677,812

Current Obligation: $675,677,812

Subaward Activity

Number of Subawards: 91

Total Subaward Amount: $169,140,377

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline