DoD Awards $25.4M for Caterpillar Motor Graders Amidst Limited Competition
Contract Overview
Contract Amount: $25,433,609 ($25.4M)
Contractor: Caterpillar Inc
Awarding Agency: Department of Defense
Start Date: 2009-06-15
End Date: 2009-12-31
Contract Duration: 199 days
Daily Burn Rate: $127.8K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: MOTOR GRADER, CATERPILLAR
Plain-Language Summary
Department of Defense obligated $25.4 million to CATERPILLAR INC for work described as: MOTOR GRADER, CATERPILLAR Key points: 1. Significant award for construction machinery, highlighting reliance on specific manufacturers. 2. Limited competition suggests potential for higher prices and reduced innovation. 3. Risk of vendor lock-in and long-term maintenance challenges. 4. Sector focus on construction machinery manufacturing, critical for infrastructure projects.
Value Assessment
Rating: questionable
The contract value of $25.4M for a single motor grader appears high. Without specific unit details or comparable contract data, it's difficult to definitively assess pricing. However, the lack of competition raises concerns about whether this represents a fair market price.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not available for competition, indicating a limited source procurement. This method restricts the number of potential bidders and can lead to less aggressive pricing as the primary contractor faces minimal pressure to offer competitive rates.
Taxpayer Impact: The limited competition likely results in taxpayers paying a premium for the motor grader, as the government did not leverage a competitive bidding process to secure the best possible price.
Public Impact
Taxpayers may have overpaid due to the absence of competitive bidding. Reliance on a single manufacturer could lead to future supply chain vulnerabilities. The long-term cost of ownership, including maintenance and parts, needs careful consideration.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Potential for overpayment
- Vendor lock-in risk
Positive Signals
- Specific equipment procured
- Firm fixed price contract
Sector Analysis
The construction machinery manufacturing sector is characterized by high barriers to entry and specialized production. Awards in this sector often involve significant capital investment and established relationships with government agencies, making competition challenging.
Small Business Impact
This award does not appear to directly benefit small businesses, as it was awarded to a large manufacturer (Caterpillar Inc.) and was not available for competition, limiting subcontracting opportunities for smaller firms.
Oversight & Accountability
The limited competition aspect warrants further oversight to ensure the price paid was justified and to explore opportunities for future competitive procurements in this category.
Related Government Programs
- Construction Machinery Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Limited competition
- Potential for price inflation
- Lack of transparency in procurement justification
- Risk of vendor lock-in for parts and service
Tags
construction-machinery-manufacturing, department-of-defense, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.4 million to CATERPILLAR INC. MOTOR GRADER, CATERPILLAR
Who is the contractor on this award?
The obligated recipient is CATERPILLAR 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 $25.4 million.
What is the period of performance?
Start: 2009-06-15. End: 2009-12-31.
What was the justification for limiting competition for this motor grader procurement?
The justification for limiting competition is not provided in the data. Typically, such decisions are based on factors like unique technical requirements, urgent needs, or the unavailability of alternative sources. Without this information, it's impossible to assess if the limited competition was warranted or if it was a missed opportunity for cost savings through a broader bidding process.
What is the expected lifespan and maintenance cost of this Caterpillar motor grader under the firm fixed price contract?
The provided data does not include details on the expected lifespan or specific maintenance costs associated with this Caterpillar motor grader. While the contract is firm fixed price, this typically covers the initial purchase price. Ongoing operational and maintenance expenses, including parts and servicing, would be separate considerations and could be influenced by the limited competition, potentially leading to higher long-term costs.
How does the awarded price compare to market benchmarks for similar Caterpillar motor graders purchased under competitive contracts?
The data does not provide sufficient information to compare the awarded price to market benchmarks for similar motor graders purchased under competitive contracts. The 'NOT AVAILABLE FOR COMPETITION' status is a key indicator that a direct price comparison is difficult. To perform such an analysis, one would need access to historical competitive contract data for comparable equipment or independent market research on current pricing.
Industry Classification
NAICS: Manufacturing › Agriculture, Construction, and Mining Machinery Manufacturing › Construction Machinery Manufacturing
Product/Service Code: CONSTRUCT/MINE/EXCAVATE/HIGHWY EQPT
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: W912ER09R0032
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Caterpillar Inc. (UEI: 005070479)
Address: 14009 OLD GALENA RD TC-A, MOSSVILLE, IL, 16
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $25,521,590
Exercised Options: $25,433,609
Current Obligation: $25,433,609
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2009-06-15
Current End Date: 2009-12-31
Potential End Date: 2009-12-31 00:00:00
Last Modified: 2014-04-28
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