Oshkosh Defense awarded $33.1M for modified trucks to support Israeli defense forces

Contract Overview

Contract Amount: $33,137,731 ($33.1M)

Contractor: Oshkosh Defense LLC

Awarding Agency: Department of Defense

Start Date: 2022-10-17

End Date: 2024-09-30

Contract Duration: 714 days

Daily Burn Rate: $46.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: FOREIGN MILITARY SALES (FMS) IN SUPPORT OF ISRAEL DEFENSE FORCE. MODIFIED M1148A1P2 8-TONNE TRUCK AND CARWELL CORROSION PROTECTION

Place of Performance

Location: OSHKOSH, WINNEBAGO County, WISCONSIN, 54902

State: Wisconsin Government Spending

Plain-Language Summary

Department of Defense obligated $33.1 million to OSHKOSH DEFENSE LLC for work described as: FOREIGN MILITARY SALES (FMS) IN SUPPORT OF ISRAEL DEFENSE FORCE. MODIFIED M1148A1P2 8-TONNE TRUCK AND CARWELL CORROSION PROTECTION Key points: 1. Contract value represents a significant investment in specialized vehicle support. 2. Sole-source award raises questions about potential price efficiencies and market alternatives. 3. Long performance period suggests a sustained need for these modified vehicles. 4. Focus on corrosion protection indicates a need for enhanced durability in specific environments. 5. This contract aligns with broader U.S. foreign military sales objectives.

Value Assessment

Rating: fair

The contract value of $33.1 million for modified trucks appears substantial. Benchmarking this against similar foreign military sales of specialized vehicles is challenging due to unique configurations and support requirements. The firm fixed-price structure provides cost certainty but may not reflect the most competitive pricing if alternatives were not fully explored. Without more comparable data, assessing the precise value-for-money is difficult, but the scale suggests a critical need.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating that only one vendor, Oshkosh Defense LLC, was deemed capable of fulfilling the requirement. This approach bypasses the competitive bidding process, which typically leads to better price discovery and potentially lower costs for the government. The rationale for a sole-source award needs to be clearly justified to ensure that taxpayer funds are used efficiently.

Taxpayer Impact: Sole-source awards limit opportunities for other businesses to compete and can potentially lead to higher prices for taxpayers compared to a fully competed contract.

Public Impact

The primary beneficiaries are the Israeli Defense Forces, receiving critical logistical support vehicles. The contract delivers modified M1148A1P2 8-tonne trucks with enhanced corrosion protection. Geographic impact is focused on the operational theater of the Israeli Defense Forces. Workforce implications are likely within Oshkosh Defense's manufacturing and support facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and potential cost savings.
Lack of transparency in the justification for sole-source procurement.
Long contract duration could lead to cost overruns if not managed effectively.

Positive Signals

Oshkosh Defense is a known entity with experience in military vehicle production.
Firm fixed-price contract provides cost predictability.
Focus on specific modifications (corrosion protection) suggests tailored support for operational needs.

Sector Analysis

The defense logistics and vehicle manufacturing sector is characterized by high barriers to entry and specialized production capabilities. Oshkosh Defense operates within this niche, providing heavy-duty vehicles for military applications. This contract fits within the broader landscape of U.S. foreign military sales, which often involve customized equipment and long-term support agreements. Spending in this area is driven by geopolitical considerations and the need to equip allied nations with advanced defense capabilities.

Small Business Impact

This contract does not appear to involve small business set-asides, as Oshkosh Defense LLC is a large prime contractor. There is no explicit information regarding subcontracting plans for small businesses within this award. The focus on a sole-source award to a large prime may limit opportunities for small businesses to participate in this specific procurement.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and financial management regulations. Accountability measures are inherent in the firm fixed-price structure, which obligates the contractor to deliver specified goods within the agreed price. Transparency regarding the sole-source justification and performance monitoring would be key areas for oversight.

Related Government Programs

Foreign Military Sales (FMS)
Heavy Tactical Vehicles
Military Truck Manufacturing
Defense Logistics Support

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for price inflation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.1 million to OSHKOSH DEFENSE LLC. FOREIGN MILITARY SALES (FMS) IN SUPPORT OF ISRAEL DEFENSE FORCE. MODIFIED M1148A1P2 8-TONNE TRUCK AND CARWELL CORROSION PROTECTION

Who is the contractor on this award?

The obligated recipient is OSHKOSH DEFENSE 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 $33.1 million.

What is the period of performance?

Start: 2022-10-17. End: 2024-09-30.

What is Oshkosh Defense's track record with similar foreign military sales contracts?

Oshkosh Defense LLC has a significant history of supplying vehicles to the U.S. military and foreign allies through various programs, including Foreign Military Sales (FMS). They are known for producing a range of heavy-duty tactical trucks, including the Family of Heavy Tactical Vehicles (FHTV) program, which encompasses vehicles like the M1148. Their experience often involves providing vehicles with specialized configurations tailored to specific operational environments and mission requirements, such as enhanced protection or mobility features. Past performance on FMS contracts would typically be evaluated by the awarding agency as part of the justification for sole-source awards or during competitive procurements, focusing on delivery timeliness, quality, and adherence to specifications.

How does the pricing of this contract compare to similar vehicle procurements, either domestically or internationally?

Directly comparing the pricing of this specific contract ($33.1 million for modified trucks) to similar procurements is challenging due to several factors. Firstly, the 'modified M1148A1P2 8-tonne truck with corrosion protection' is a specialized configuration, and pricing can vary significantly based on the exact modifications, quantity, and support included. Secondly, as a sole-source award, there is no competitive benchmark to assess price reasonableness. Foreign Military Sales pricing can also be influenced by factors beyond standard commercial rates, including specific government-to-government agreements, sustainment packages, and the inclusion of training or spare parts. Without access to detailed cost breakdowns or comparable sole-source justifications for similar specialized military vehicle sales, a precise value-for-money comparison is difficult.

What are the primary risks associated with this sole-source contract?

The primary risks associated with this sole-source contract include potential lack of price competition, leading to higher costs for taxpayers than might be achieved through a competitive process. There's also a risk of reduced innovation if the sole provider faces less pressure to improve efficiency or technology. Furthermore, reliance on a single supplier can create supply chain vulnerabilities. Ensuring robust oversight and performance management is crucial to mitigate these risks. The justification for the sole-source award must be thoroughly documented and validated to confirm that no viable alternatives existed, thereby safeguarding against unnecessary expenditure and ensuring the best value is obtained under the circumstances.

What is the expected effectiveness of these modified trucks in their intended operational environment?

The effectiveness of the modified M1148A1P2 8-tonne trucks is expected to be high within their intended operational environment, primarily due to the specific modifications being implemented. The 'corrosion protection' feature is critical for ensuring vehicle longevity and operational readiness in environments where exposure to harsh elements, such as saltwater or specific atmospheric conditions, is a concern. The M1148A1P2 is an 8-tonne truck, indicating its capacity for carrying significant payloads or personnel, making it a versatile asset for logistical support, troop transport, or equipment movement. The modification suggests a tailored approach to meet the unique challenges faced by the Israeli Defense Forces, thereby enhancing their operational capabilities and reducing maintenance burdens related to environmental degradation.

How does this contract align with historical U.S. spending patterns on foreign military sales for defense equipment?

This contract aligns with historical U.S. spending patterns on foreign military sales (FMS), which consistently involve providing defense equipment and support to key allies, including Israel. The U.S. government has a long-standing policy of supporting the security of Israel through various means, including the sale of military hardware. Spending on vehicles, munitions, aircraft, and other defense systems constitutes a significant portion of FMS. Contracts like this, for specialized vehicles with specific modifications, are typical within the FMS framework, reflecting the need to equip allied forces with capabilities that meet their unique operational requirements and security challenges. The total value of FMS to Israel fluctuates annually but remains a substantial component of U.S. foreign aid and defense cooperation.

Industry Classification

NAICS: Manufacturing › Motor Vehicle Manufacturing › Heavy Duty Truck Manufacturing

Product/Service Code: MOTOR VEHICLES, CYCLES, TRAILERS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Oshkosh Corp

Address: 2307 OREGON ST, OSHKOSH, WI, 54902

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

Financial Breakdown

Contract Ceiling: $33,137,731

Exercised Options: $33,137,731

Current Obligation: $33,137,731

Subaward Activity

Number of Subawards: 296

Total Subaward Amount: $24,148,871

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56HZV20D0009

IDV Type: IDC

Timeline