DoD Awards $101M Contract for Paladin Vehicle Support to BAE Systems, Exercising 7,904 Program Management Hours
Contract Overview
Contract Amount: $101,298,982 ($101.3M)
Contractor: BAE Systems Land & Armaments L.P.
Awarding Agency: Department of Defense
Start Date: 2024-03-13
End Date: 2028-06-18
Contract Duration: 1,558 days
Daily Burn Rate: $65.0K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: SYSTEM TECHNICAL SUPPORT (STS) AND SUSTAINMENT SYSTEM TECHNICAL SUPPORT (SSTS) M109 FAMILY OF VEHICLES (FOV) PALADIN SERVICE CONTRACT. THIS ACTION EXERCISES 7,904 PROGRAM MANAGEMENT LABOR HOURS.
Place of Performance
Location: YORK, YORK County, PENNSYLVANIA, 17408
Plain-Language Summary
Department of Defense obligated $101.3 million to BAE SYSTEMS LAND & ARMAMENTS L.P. for work described as: SYSTEM TECHNICAL SUPPORT (STS) AND SUSTAINMENT SYSTEM TECHNICAL SUPPORT (SSTS) M109 FAMILY OF VEHICLES (FOV) PALADIN SERVICE CONTRACT. THIS ACTION EXERCISES 7,904 PROGRAM MANAGEMENT LABOR HOURS. Key points: 1. Contract awarded to BAE Systems for M109 Paladin vehicle technical support. 2. Significant portion of contract allocated to program management labor hours. 3. Cost-plus-fixed-fee contract type may lead to cost overruns. 4. Limited competition raises concerns about price discovery and value for money.
Value Assessment
Rating: questionable
The contract is a Cost Plus Fixed Fee (CPFF) type, which can incentivize contractors to increase costs. Without a competitive bidding process, it's difficult to assess if the $101M price is optimal compared to similar service contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no market pressure to offer the best price.
Taxpayer Impact: The lack of competition for this significant contract may result in taxpayers paying more than necessary for system technical support and sustainment.
Public Impact
Ensures continued operational readiness for the M109 Paladin fleet. Supports critical defense infrastructure and personnel. Potential for increased costs due to sole-source award impacts taxpayer burden. Long-term sustainment contract may lock in vendor for extended period.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus-fixed-fee contract type
- Lack of transparency in pricing
Positive Signals
- Ensures critical system support
- Long-term sustainment plan
Sector Analysis
This contract falls under Engineering Services (NAICS 541330) for defense systems. Spending in this sector is crucial for maintaining military readiness, but often involves complex, specialized services where competition can be challenging.
Small Business Impact
The data indicates this contract was awarded directly to BAE Systems Land & Armaments L.P. and does not mention any subcontracting opportunities for small businesses. Further investigation is needed to determine if small businesses will be involved.
Oversight & Accountability
The contract is a delivery order under a larger program. Oversight will be critical to ensure BAE Systems meets performance requirements and that costs remain within reasonable bounds, especially given the CPFF structure and lack of competition.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition.
- Cost-plus-fixed-fee structure can lead to cost overruns.
- Lack of transparency regarding pricing justification.
- Potential for contractor lock-in.
- Limited visibility into small business participation.
Tags
engineering-services, department-of-defense, pa, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $101.3 million to BAE SYSTEMS LAND & ARMAMENTS L.P.. SYSTEM TECHNICAL SUPPORT (STS) AND SUSTAINMENT SYSTEM TECHNICAL SUPPORT (SSTS) M109 FAMILY OF VEHICLES (FOV) PALADIN SERVICE CONTRACT. THIS ACTION EXERCISES 7,904 PROGRAM MANAGEMENT LABOR HOURS.
Who is the contractor on this award?
The obligated recipient is BAE SYSTEMS LAND & ARMAMENTS L.P..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $101.3 million.
What is the period of performance?
Start: 2024-03-13. End: 2028-06-18.
What is the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one vendor can fulfill the requirement. Without specific documentation, it's difficult to ascertain the precise reason, but it raises concerns about potential lack of market research or an unwillingness to explore competitive options.
How will the Department of Defense ensure cost control and value for money with a Cost Plus Fixed Fee contract awarded without competition?
Effective cost control will rely heavily on robust government oversight, detailed audits, and strict adherence to the fixed fee component. The government must diligently monitor all incurred costs, negotiate reasonable rates, and ensure that the contractor's performance is efficient and aligned with the contract's objectives to mitigate potential cost overruns.
What is the long-term strategy for sustaining the M109 Paladin Family of Vehicles, and how does this contract fit into that strategy?
This contract represents a significant component of the M109 Paladin's sustainment plan, focusing on technical support. The long-term strategy likely involves a lifecycle approach to maintenance, upgrades, and operational readiness. Understanding how this $101M award integrates with broader modernization or replacement programs is crucial for assessing its overall effectiveness and taxpayer value.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Ball Corporation
Address: 1100 BAIRS RD, YORK, PA, 17408
Business Categories: Category Business, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations
Financial Breakdown
Contract Ceiling: $101,342,238
Exercised Options: $101,342,238
Current Obligation: $101,298,982
Subaward Activity
Number of Subawards: 4
Total Subaward Amount: $1,059,484
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W56HZV24D0020
IDV Type: IDC
Timeline
Start Date: 2024-03-13
Current End Date: 2028-06-18
Potential End Date: 2028-06-18 12:06:00
Last Modified: 2026-01-14
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