DoD awards $76.4M for TIGER III hardware, a sole-source contract to Honeywell

Contract Overview

Contract Amount: $76,417,519 ($76.4M)

Contractor: Honeywell International Inc.

Awarding Agency: Department of Defense

Start Date: 2023-03-03

End Date: 2026-02-01

Contract Duration: 1,066 days

Daily Burn Rate: $71.7K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: TIGER III YEAR THREE ORDERING PERIOD FOR HARDWARE. D.O.8

Place of Performance

Location: PHOENIX, MARICOPA County, ARIZONA, 85034

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $76.4 million to HONEYWELL INTERNATIONAL INC. for work described as: TIGER III YEAR THREE ORDERING PERIOD FOR HARDWARE. D.O.8 Key points: 1. Contract awarded via sole-source justification, raising questions about price competition. 2. Significant portion of contract value allocated to hardware, suggesting direct equipment procurement. 3. Long performance period of nearly three years indicates a sustained need for these systems. 4. Contract is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 5. The contract's focus on armored vehicle components points to a critical defense manufacturing need. 6. Geographic focus on Arizona for contract performance.

Value Assessment

Rating: questionable

The contract value of $76.4 million for hardware over a nearly three-year period requires careful benchmarking. As a sole-source award, direct comparison to competitive bids is impossible. However, the absence of competition suggests potential for inflated pricing. Further analysis would involve comparing the unit costs of specific hardware components to industry standards or previous similar sole-source awards for the same or comparable systems. Without competitive pressure, ensuring optimal value for taxpayer dollars is a primary concern.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Honeywell International Inc., was solicited. The justification for this approach is not detailed in the provided data. Sole-source awards bypass the competitive bidding process, which typically drives down prices and ensures a wider range of solutions are considered. This limits the government's ability to explore alternative technologies or achieve the best possible pricing through market forces.

Taxpayer Impact: Sole-source awards mean taxpayers may not be receiving the most cost-effective solution available, as competition is absent. This can lead to higher prices than might be achieved in a fully competed environment.

Public Impact

The primary beneficiaries are the Department of the Army and potentially other Department of Defense entities requiring advanced armored vehicle hardware. The contract delivers critical hardware components for military armored vehicles, essential for national defense operations. Performance is concentrated in Arizona, potentially impacting the local economy and workforce in that state. The contract supports specialized manufacturing jobs within Honeywell and its supply chain, likely in areas related to defense systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential for cost savings.
Lack of transparency in the justification for sole-source procurement.
Potential for vendor lock-in due to specialized nature of military hardware.
Long-term contract duration could mask inefficiencies if not closely monitored.

Positive Signals

Award to an established contractor (Honeywell) with a track record in defense manufacturing.
Contract addresses a critical need for military hardware, supporting national security objectives.
Delivery order structure allows for phased procurement and management of hardware needs.
Fixed-price contract type provides cost certainty for the government once awarded.

Sector Analysis

This contract falls within the Defense Industrial Base sector, specifically focusing on military armored vehicle manufacturing. The market for such specialized components is often concentrated among a few key defense contractors. Honeywell International Inc. is a major player in this space. Benchmarking would involve comparing this award to other sole-source or competitively awarded contracts for similar vehicle components or systems within the DoD, considering factors like technological sophistication and quantity.

Small Business Impact

The data indicates that small business participation is not a primary focus of this specific award, as indicated by 'sb': false. There is no mention of small business set-asides or subcontracting plans. This suggests that the prime contractor, Honeywell, is expected to fulfill the contract requirements directly or through its established supply chain, which may or may not involve significant small business engagement. Further investigation into Honeywell's subcontracting practices would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a delivery order under an IDIQ, the parent contract likely has established oversight mechanisms. Transparency is limited by the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected. Accountability relies on performance metrics and adherence to contract terms.

Related Government Programs

TIGER III Program
Army Combat Systems
Armored Vehicle Procurement
Defense Hardware Contracts
Sole-Source Defense Awards

Risk Flags

Sole-source award raises concerns about competition and potential overpricing.
Lack of detailed justification for sole-source procurement.
Absence of small business set-aside or subcontracting requirements.
Limited public information on specific hardware components and their costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $76.4 million to HONEYWELL INTERNATIONAL INC.. TIGER III YEAR THREE ORDERING PERIOD FOR HARDWARE. D.O.8

Who is the contractor on this award?

The obligated recipient is HONEYWELL INTERNATIONAL 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 $76.4 million.

What is the period of performance?

Start: 2023-03-03. End: 2026-02-01.

What is the specific justification provided by the Department of the Army for awarding this contract on a sole-source basis to Honeywell International Inc.?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source is available, or when there is a compelling urgency, or for reasons of industrial mobilization. For a contract of this magnitude and duration, the justification would likely be detailed in a Justification and Approval (J&A) document. This document would need to demonstrate why full and open competition was not feasible or not in the government's best interest. Without access to the J&A, it is difficult to assess the validity of the sole-source determination and its impact on potential cost savings.

How does the unit cost of the hardware procured under this contract compare to similar components purchased competitively by the DoD?

Direct comparison of unit costs is not possible with the provided data, as it lacks specific line-item details for the hardware being procured and does not include any competitive benchmark pricing. As a sole-source award, there was no competitive bidding process to establish a market-driven price. To assess value for money, one would need to obtain detailed specifications of the hardware, identify comparable components purchased under competitive contracts (either by the Army or other DoD branches), and then analyze any price discrepancies. Factors such as technological advancements, quantity discounts, and specific performance requirements would need to be considered in any such comparison.

What are the key performance indicators (KPIs) and quality assurance measures in place to ensure Honeywell meets the delivery and performance requirements for this hardware?

The provided data does not specify the key performance indicators (KPIs) or quality assurance (QA) measures for this contract. However, standard government contracting practices would dictate that such measures are included in the contract's terms and conditions. For hardware delivery, KPIs would likely include on-time delivery rates, adherence to specifications, and defect rates. QA measures would involve inspection and testing protocols, potentially conducted by government representatives at Honeywell's facilities or upon receipt of the hardware. The effectiveness of these measures is crucial for ensuring the government receives high-quality, functional equipment.

What is Honeywell International Inc.'s historical performance record with the Department of the Army, particularly on similar sole-source contracts?

The provided data does not contain specific details on Honeywell International Inc.'s historical performance on similar sole-source contracts with the Department of the Army. However, Honeywell is a large, established defense contractor with a broad portfolio of products and services. Assessing their track record would typically involve reviewing past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), any past disputes or contract terminations, and their overall history of delivering complex defense systems. A review of their performance on previous TIGER III orders or related armored vehicle programs would be particularly relevant.

What is the total historical spending by the Department of the Army on the TIGER III program, and how does this specific award contribute to that total?

The provided data pertains to a specific delivery order ('TIGER III YEAR THREE ORDERING PERIOD FOR HARDWARE') valued at $76.4 million. It does not provide the total historical spending for the entire TIGER III program. The TIGER III program is likely an Indefinite Delivery/Indefinite Quantity (IDIQ) contract vehicle, meaning it allows for multiple orders over its lifetime. This $76.4 million represents a portion of the total potential value of the TIGER III IDIQ. To understand the program's total spending, one would need to examine the ceiling value of the parent IDIQ contract and the sum of all delivery orders issued against it since its inception.

Industry Classification

NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Honeywell Safety Products USA, Inc.

Address: 111 S 34TH ST, PHOENIX, AZ, 85034

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: $76,417,519

Exercised Options: $76,417,519

Current Obligation: $76,417,519

Subaward Activity

Number of Subawards: 321

Total Subaward Amount: $7,056,340,804

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56HZV20D0062

IDV Type: IDC

Timeline