DoD's $18.1M CFCS Launch Adapter Group contract awarded to Defense Systems and Solutions

Contract Overview

Contract Amount: $18,109,739 ($18.1M)

Contractor: Defense Systems and Solutions

Awarding Agency: Department of Defense

Start Date: 2023-04-11

End Date: 2027-11-30

Contract Duration: 1,694 days

Daily Burn Rate: $10.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: COMMON FIRE CONTROL SYSTEM (CFCS) LAUNCH ADAPTER GROUP (LAG).

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $18.1 million to DEFENSE SYSTEMS AND SOLUTIONS for work described as: COMMON FIRE CONTROL SYSTEM (CFCS) LAUNCH ADAPTER GROUP (LAG). Key points: 1. Contract awarded via full and open competition after exclusion of sources, indicating a competitive process with specific justifications. 2. The contract type is Cost Plus Fixed Fee (CPFF), which can lead to cost overruns if not managed carefully. 3. The contract duration is over 4 years, suggesting a long-term need for these specialized components. 4. The awardee, Defense Systems and Solutions, is positioned to deliver critical components for defense systems. 5. The North American Industry Classification System (NAICS) code 336413 points to specialized manufacturing within the aerospace sector. 6. The contract is a delivery order under a larger contract vehicle, implying a phased approach to procurement.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more detailed cost breakdowns or comparisons to similar launch adapter groups. The Cost Plus Fixed Fee (CPFF) contract type introduces inherent risk for cost control, as the contractor is reimbursed for allowable costs plus a fixed fee. While this can be appropriate for research and development or when costs are uncertain, it requires robust oversight to ensure the government receives good value. Without data on the fixed fee percentage or the projected total costs, a definitive value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This suggests that while the competition was intended to be broad, specific sources were excluded, likely due to unique capabilities or prior relationships. The exact number of bidders and the rationale for exclusions are not detailed, making it difficult to fully assess the breadth of competition. This procurement method can sometimes lead to less competitive pricing compared to unrestricted full and open competition.

Taxpayer Impact: The exclusion of certain sources, even within a broader competitive framework, may limit the government's ability to secure the most cost-effective solution for taxpayers. Further transparency on the exclusion criteria would be beneficial.

Public Impact

The Department of the Army benefits from the acquisition of essential components for its Common Fire Control System (CFCS). This contract supports the production and delivery of Launch Adapter Groups (LAGs), critical for military operations. The contract's performance is based in Alabama (AL), potentially creating or sustaining jobs in that region. The manufacturing of these specialized parts contributes to the readiness and technological advancement of the U.S. military.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can incentivize higher spending if not rigorously managed.
The 'exclusion of sources' in the competition method warrants further investigation into potential limitations on competitive pricing.
Limited public data on the specific performance metrics or technical requirements makes it hard to assess the value proposition fully.

Positive Signals

Awarded through a competitive process, even with exclusions, suggests an effort to find qualified providers.
The long contract duration indicates a sustained need and potential for stable supply chain for critical components.
The contract supports a vital defense system, contributing to national security objectives.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. The market for such specialized components is driven by defense spending and technological advancements in military hardware. Companies operating in this space require significant technical expertise and often hold specific certifications. Benchmarking against similar contracts for fire control system components or specialized military hardware would provide further context on pricing and performance.

Small Business Impact

The contract details indicate that small business participation was not a primary set-aside consideration (ss: false, sb: false). This suggests that the prime contract was not specifically targeted towards small businesses. However, the prime contractor, Defense Systems and Solutions, may engage small businesses as subcontractors. Further analysis of subcontracting plans would be necessary to determine the extent of small business involvement and its impact on the broader small business ecosystem.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract would typically involve the Department of the Army's contracting officers and program managers. They are responsible for monitoring costs, ensuring compliance with contract terms, and verifying the delivery of goods. The Inspector General's office within the Department of Defense may also conduct audits or investigations to ensure accountability and prevent fraud, waste, and abuse. Transparency regarding performance reports and cost audits would enhance oversight assessment.

Related Government Programs

Common Fire Control Systems
Military Aircraft Components
Defense Systems Procurement
Aerospace Manufacturing Contracts

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage potential cost escalations.
The 'exclusion of sources' in the competitive process warrants scrutiny to ensure maximum value for taxpayers.
Limited public data on specific performance metrics makes independent value assessment challenging.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.1 million to DEFENSE SYSTEMS AND SOLUTIONS. COMMON FIRE CONTROL SYSTEM (CFCS) LAUNCH ADAPTER GROUP (LAG).

Who is the contractor on this award?

The obligated recipient is DEFENSE SYSTEMS AND SOLUTIONS.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $18.1 million.

What is the period of performance?

Start: 2023-04-11. End: 2027-11-30.

What is the track record of Defense Systems and Solutions in delivering similar components under government contracts?

Information regarding the specific track record of Defense Systems and Solutions in delivering Common Fire Control System (CFCS) Launch Adapter Groups (LAGs) or comparable complex military components is not readily available in the provided data. A deeper dive into the contractor's past performance databases, such as the Contractor Performance Assessment Reporting System (CPARS), would be necessary to evaluate their history of meeting cost, schedule, and performance requirements on similar projects. Understanding their experience with Cost Plus Fixed Fee (CPFF) contracts specifically would also be crucial, as this contract type requires diligent cost management and reporting.

How does the estimated value of this contract compare to similar procurements for fire control system components?

Direct comparison of the $18.1 million contract value for the CFCS Launch Adapter Group (LAG) to similar procurements is difficult without access to a broader dataset of comparable contracts. Factors such as the specific technical requirements, quantity, complexity of the LAG, and the prevailing market rates for specialized aerospace manufacturing influence pricing. The contract type (CPFF) also makes direct value comparisons challenging, as it is cost-reimbursable with a fixed fee, unlike fixed-price contracts. Benchmarking would require identifying contracts with identical or highly similar components, awarded around the same time, and ideally under similar competitive conditions.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for manufacturing specialized defense components?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract is the potential for cost overruns. While the contractor's fee is fixed, they are reimbursed for all allowable costs. If costs escalate beyond initial projections due to unforeseen technical challenges, material price increases, or inefficient management, the total contract value can increase significantly. This necessitates robust government oversight to scrutinize allowable costs and ensure the contractor maintains cost-consciousness. Another risk is that the fixed fee might not adequately incentivize the contractor to control costs if it is set too high, or conversely, it might not sufficiently reward efficient performance if set too low.

What is the significance of the 'Full and Open Competition After Exclusion of Sources' award method for this contract?

The 'Full and Open Competition After Exclusion of Sources' method signifies that the solicitation was made available to all responsible sources capable of meeting the requirements, but specific sources were excluded from the outset. This exclusion typically occurs when there's a justifiable reason, such as proprietary data, unique capabilities held by only a few entities, or specific national security concerns. While it aims for competition, the exclusion of potential bidders inherently limits the competitive landscape. The justification for these exclusions is critical; if the exclusions were not well-founded, it could potentially lead to higher prices and reduced innovation compared to unrestricted full and open competition.

What are the potential implications of this contract on the broader aerospace and defense manufacturing supply chain?

This contract for CFCS Launch Adapter Groups (LAGs) implies a sustained demand for specialized manufacturing capabilities within the aerospace and defense sector. It supports the production of critical components for the Department of the Army, contributing to the overall readiness of military forces. The award to Defense Systems and Solutions could bolster their capacity and expertise in this niche area. Depending on their subcontracting strategy, it may also create opportunities for other suppliers, including small businesses, within the defense industrial base, potentially strengthening specific segments of the manufacturing supply chain.

How does the geographic location of contract performance (Alabama) potentially impact the contract's execution and economic benefits?

Performance in Alabama (AL) suggests that the economic benefits of this $18.1 million contract, such as job creation and revenue generation, will primarily accrue to that state's economy. This location may offer advantages in terms of a skilled workforce, existing industrial infrastructure, or proximity to related defense facilities. However, it could also present logistical considerations if other aspects of the program (e.g., testing, integration) occur elsewhere. The state's specific business environment and regulatory landscape might also influence operational efficiency and costs for the contractor.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 631 DISCOVERY DR, HUNTSVILLE, AL, 35806

Business Categories: Alaskan Native Corporation Owned Firm, Category Business, Minority Owned Business, Native American Owned Business, Partnership or Limited Liability Partnership, SBA Certified 8 a Joint Venture, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $18,109,739

Exercised Options: $18,109,739

Current Obligation: $18,109,739

Subaward Activity

Number of Subawards: 30

Total Subaward Amount: $3,505,551

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W58RGZ18D0001

IDV Type: IDC

Timeline