DoD Awards $202.6M Performance-Based Logistics Contract to General Dynamics for Stryker Vehicle Support

Contract Overview

Contract Amount: $202,616,320 ($202.6M)

Contractor: General Dynamics Land Systems Inc.

Awarding Agency: Department of Defense

Start Date: 2025-03-01

End Date: 2026-02-28

Contract Duration: 364 days

Daily Burn Rate: $556.6K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Defense

Official Description: STRYKER WHOLESALE SUPPLY IS A PERFORMANCE-BASED LOGISTICS CONTRACT THAT ALLOWS THE CONTRACTOR TO WAREHOUSE, INVENTORY, AND PURCHASE MATERIAL BASED ON A STRYKER VEHICLE DENSITY.

Place of Performance

Location: STERLING HEIGHTS, MACOMB County, MICHIGAN, 48310

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $202.6 million to GENERAL DYNAMICS LAND SYSTEMS INC. for work described as: STRYKER WHOLESALE SUPPLY IS A PERFORMANCE-BASED LOGISTICS CONTRACT THAT ALLOWS THE CONTRACTOR TO WAREHOUSE, INVENTORY, AND PURCHASE MATERIAL BASED ON A STRYKER VEHICLE DENSITY. Key points: 1. The contract focuses on warehousing, inventory, and material purchase for Stryker vehicles, indicating a need for efficient supply chain management. 2. General Dynamics Land Systems Inc. is the sole awardee, raising questions about competition and potential price discovery limitations. 3. The performance-based nature suggests a focus on outcomes, but the specific metrics and their impact on cost-effectiveness require scrutiny. 4. The sector is military armored vehicle manufacturing, a critical but often high-cost area for defense spending.

Value Assessment

Rating: questionable

The contract type is Cost Plus Incentive Fee (CPIF), which can lead to cost overruns if not managed tightly. The award amount of $202.6M for a 364-day duration suggests a significant investment, and the lack of competition makes a direct pricing comparison difficult.

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 is no competitive pressure to drive down prices.

Taxpayer Impact: The lack of competition on this significant contract may result in taxpayers paying more than necessary for logistics and material support services.

Public Impact

Ensures continued operational readiness of Stryker vehicle fleets through dedicated logistics support. Potential for increased costs due to sole-source award impacts overall defense budget allocation. Supports a critical component of the Army's ground vehicle modernization and sustainment efforts. The performance-based aspect could lead to improved efficiency and reduced downtime for vehicles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
Cost Plus Incentive Fee contract type carries inherent risk of cost overruns.
Lack of transparency in performance metrics and their impact on cost.

Positive Signals

Performance-based contract aims for efficiency and outcome-driven results.
Supports critical military hardware (Stryker vehicles).
Contract duration aligns with anticipated operational needs.

Sector Analysis

This contract falls within the Defense sector, specifically supporting the manufacturing and maintenance of military armored vehicles. Spending in this area is often characterized by high unit costs, long procurement cycles, and significant reliance on a few prime contractors due to specialized requirements.

Small Business Impact

The data indicates that small business participation was not a stated requirement for this contract (ss: false, sb: false). This suggests that opportunities for small businesses in this specific logistics and supply chain segment may be limited.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure fair pricing and effective performance. Accountability will hinge on the government's ability to monitor the CPIF contract's cost drivers and the contractor's adherence to performance objectives.

Related Government Programs

Military Armored Vehicle, Tank, and Tank Component Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award.
Cost Plus Incentive Fee contract type.
Potential for lack of price competition.
Limited visibility into specific performance metrics.
No explicit small business set-aside.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $202.6 million to GENERAL DYNAMICS LAND SYSTEMS INC.. STRYKER WHOLESALE SUPPLY IS A PERFORMANCE-BASED LOGISTICS CONTRACT THAT ALLOWS THE CONTRACTOR TO WAREHOUSE, INVENTORY, AND PURCHASE MATERIAL BASED ON A STRYKER VEHICLE DENSITY.

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS LAND SYSTEMS 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 $202.6 million.

What is the period of performance?

Start: 2025-03-01. End: 2026-02-28.

What specific performance metrics are included in this contract, and how are they tied to the incentive fee structure to ensure value for money?

The provided data does not detail the specific performance metrics or the incentive fee structure. A thorough review would require access to the contract's statement of work and associated clauses. Understanding these elements is crucial to assessing whether the performance-based nature truly drives value and cost savings, or if it merely formalizes existing processes without tangible benefits.

Given the sole-source award, what steps has the Department of the Army taken to validate the necessity of this approach and ensure the pricing is fair and reasonable?

Without a competitive process, the Department of the Army must have conducted extensive market research and cost analysis to justify the sole-source award and establish a fair and reasonable price. This typically involves detailed cost breakdowns from the contractor, benchmarking against similar services, and potentially independent government cost estimates to mitigate the risks associated with a lack of competition.

How does this contract contribute to the overall readiness and modernization goals for the Stryker vehicle fleet, and what are the potential risks if these logistics are not effectively managed?

This contract is designed to ensure the operational readiness of Stryker vehicles by managing their supply chain, warehousing, and material procurement. Effective management reduces vehicle downtime and ensures parts availability. Risks of ineffective management include decreased combat readiness, increased maintenance costs, and potential delays in fielding upgrades or new capabilities, impacting the Army's strategic objectives.

Industry Classification

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

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 INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Address: 38500 MOUND RD, STERLING HEIGHTS, MI, 48310

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: $202,616,320

Exercised Options: $202,616,320

Current Obligation: $202,616,320

Subaward Activity

Number of Subawards: 13

Total Subaward Amount: $4,151,779

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56HZV24D0031

IDV Type: IDC

Timeline