Department of Defense awards $37.1M contract for POWER PACK ASSEMBLY PN: 5717314 to AM GENERAL LLC

Contract Overview

Contract Amount: $37,142,286 ($37.1M)

Contractor: AM General LLC

Awarding Agency: Department of Defense

Start Date: 2012-01-31

End Date: 2012-12-29

Contract Duration: 333 days

Daily Burn Rate: $111.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: POWER PACK ASSEMBLY PN: 5717314

Place of Performance

Location: MISHAWAKA, ST. JOSEPH County, INDIANA, 46544, UNITED STATES OF AMERICA

State: Indiana Government Spending

Plain-Language Summary

Department of Defense obligated $37.1 million to AM GENERAL LLC for work described as: POWER PACK ASSEMBLY PN: 5717314 Key points: 1. Contract awarded on a firm-fixed-price basis, indicating predictable costs for the government. 2. The contract was not competed, raising questions about potential price efficiencies. 3. Awarded to AM GENERAL LLC, a known entity in vehicle manufacturing. 4. The contract duration of 333 days suggests a focused, short-term requirement. 5. The North American Industry Classification System (NAICS) code 333618 points to engine equipment manufacturing. 6. The contract was awarded by the Department of the Army, a major component of the DoD.

Value Assessment

Rating: questionable

The contract value of $37.1 million for a POWER PACK ASSEMBLY is substantial. Without comparable contract data or detailed cost breakdowns, it is difficult to definitively assess value for money. The lack of competition suggests that the government may not have secured the most competitive pricing available in the market. Benchmarking against similar procurements for engine components or power packs would be necessary for a more robust evaluation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor can provide the required goods or services, or in cases of urgent need. The lack of competition limits the government's ability to leverage market forces to drive down prices and potentially explore innovative solutions from a wider range of suppliers.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as the benefits of competitive bidding are forgone. It also reduces transparency in the procurement process.

Public Impact

The primary beneficiaries are likely military personnel who will utilize equipment fitted with these power packs. The services delivered involve the manufacturing and supply of critical engine components. The geographic impact is primarily within the United States, given the contractor's location and the nature of defense procurement. Workforce implications include employment at AM GENERAL LLC and its supply chain partners.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in a higher price than if the contract were competed.
Sole-source awards can reduce transparency and limit opportunities for other qualified vendors.
Reliance on a single source could pose a risk if the contractor faces production issues or financial instability.

Positive Signals

Award to an established contractor (AM GENERAL LLC) suggests a degree of reliability in delivery.
Firm-fixed-price contract provides cost certainty for the government.
The specific part number (5717314) indicates a well-defined requirement.

Sector Analysis

The manufacturing of engine equipment falls under the broader industrial sector, specifically within the automotive and defense manufacturing sub-sectors. This contract for a specific power pack assembly is a component-level procurement within the larger defense industrial base. The market for such specialized components is often characterized by a limited number of highly capable manufacturers, especially for military-grade equipment. Comparable spending benchmarks would involve analyzing other DoD contracts for similar vehicle power systems or engine components.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. Furthermore, the contractor, AM GENERAL LLC, is a large business. There is no explicit information regarding subcontracting plans for small businesses within this award. This means that opportunities for small businesses to participate in this specific contract are likely limited unless they are part of AM GENERAL's broader supply chain, which is not detailed here.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are inherent in the firm-fixed-price structure, which obligates the contractor to deliver the specified product at the agreed-upon price. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Vehicle Procurement
Engine and Power System Manufacturing
Department of Defense Supply Chain Management
Defense Industrial Base Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for price inflation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.1 million to AM GENERAL LLC. POWER PACK ASSEMBLY PN: 5717314

Who is the contractor on this award?

The obligated recipient is AM GENERAL 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 $37.1 million.

What is the period of performance?

Start: 2012-01-31. End: 2012-12-29.

What is the track record of AM GENERAL LLC in fulfilling similar Department of Defense contracts?

AM GENERAL LLC has a long history of supplying vehicles and components to the U.S. military, most notably the High Mobility Multipurpose Wheeled Vehicle (HMPWV), often referred to as the Humvee. They have secured numerous contracts for vehicle production, upgrades, and spare parts over several decades. Their experience suggests a deep understanding of military specifications and operational requirements. However, the specifics of their performance on contracts for 'POWER PACK ASSEMBLY PN: 5717314' would require a detailed review of past performance evaluations and delivery records for this particular item or closely related components. Without access to that granular data, we can infer a general capability based on their broader portfolio.

How does the awarded price of $37.1 million compare to market rates for similar power pack assemblies?

Directly comparing the $37.1 million award to market rates for 'POWER PACK ASSEMBLY PN: 5717314' is challenging without specific, publicly available cost data or benchmark pricing for this exact component. As a sole-source award, there's an inherent risk that the price may not reflect the most competitive market conditions. To assess value, one would need to: 1. Identify if this is a standard or highly specialized power pack. 2. Research pricing for comparable power packs used in similar military vehicles or industrial applications from other manufacturers. 3. Obtain cost breakdowns from the contractor if possible, or rely on government cost-analysis reports. Given the lack of competition, a thorough independent cost analysis would be crucial for the DoD to ensure fair pricing.

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

The primary risks associated with this sole-source contract are: 1. **Price:** Without competition, there is a significant risk of paying a premium price. The government lacks the leverage to negotiate based on multiple bids. 2. **Limited Innovation:** A sole-source award may stifle innovation as there's no incentive for the contractor to propose more cost-effective or technologically advanced solutions beyond the specified requirements. 3. **Dependency:** The government becomes dependent on a single supplier, creating vulnerability if AM GENERAL LLC experiences production delays, quality issues, or financial instability. 4. **Transparency:** Sole-source procurements generally offer less transparency into the pricing structure and selection process compared to competed contracts.

What is the historical spending pattern for 'POWER PACK ASSEMBLY PN: 5717314' or similar components by the Department of Defense?

Analyzing historical spending for 'POWER PACK ASSEMBLY PN: 5717314' requires access to contract databases that track specific part numbers or their associated Product Service Codes (PSCs). The provided data indicates this is a single award of $37.1 million in 2012. Without further data, it's impossible to determine if this is a recurring purchase, a one-time procurement, or if similar power packs have been acquired historically under different part numbers or PSCs. If this is a critical component for a specific vehicle platform, one might expect recurring procurements, potentially through different contract vehicles or competitions over time. A comprehensive review would involve searching databases like FPDS or SAM.gov for all contracts related to this part number and its relevant PSC (likely within the 'Other Engine Equipment Manufacturing' category).

What is the significance of the NAICS code 333618 in understanding this contract?

The North American Industry Classification System (NAICS) code 333618, 'Other Engine Equipment Manufacturing,' provides crucial context for this contract. It signifies that the procured item, the POWER PACK ASSEMBLY, is a product manufactured by a company specializing in engine components, excluding internal combustion engines themselves or turbines. This classification helps categorize the contract within the broader industrial landscape, indicating that the supplier is involved in producing parts essential for the operation of engines, such as components related to power transmission, cooling, or ancillary systems. It also aids in identifying potential competitors within the same manufacturing sub-sector for future benchmarking or competitive bidding processes.

Industry Classification

NAICS: Manufacturing › Engine, Turbine, and Power Transmission Equipment Manufacturing › Other Engine Equipment Manufacturing

Product/Service Code: ENGINES AND TURBINES AND COMPONENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W911N212R0005

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Macandrews & Forbes Holdings Inc. (UEI: 878304849)

Address: 408 S BYRKIT ST, MISHAWAKA, IN, 46544

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

Financial Breakdown

Contract Ceiling: $37,142,286

Exercised Options: $37,142,286

Current Obligation: $37,142,286

Contract Characteristics

Cost or Pricing Data: NO

Timeline