DoD's $27.7M contract for M1151 vehicles awarded to foreign entity raises questions about value and competition

Contract Overview

Contract Amount: $27,691,356 ($27.7M)

Contractor: Miscellaneous Foreign Awardees

Awarding Agency: Department of Defense

Start Date: 2007-08-31

End Date: 2008-02-04

Contract Duration: 157 days

Daily Burn Rate: $176.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: {PIIN: W91GY007C0044} UPARMOR M1151 VEHICLES

Plain-Language Summary

Department of Defense obligated $27.7 million to MISCELLANEOUS FOREIGN AWARDEES for work described as: {PIIN: W91GY007C0044} UPARMOR M1151 VEHICLES Key points: 1. Contract awarded to a miscellaneous foreign awardee, suggesting limited domestic competition or specialized foreign sourcing. 2. The contract's fixed-price nature aims to control costs, but the foreign awardee warrants scrutiny for potential price advantages or disadvantages. 3. A short performance period of 157 days indicates a specific, potentially urgent, need for the vehicles. 4. The contract falls under Administrative Management and General Management Consulting Services, which seems incongruous with vehicle procurement. 5. Lack of small business involvement suggests this was not a set-aside contract. 6. The contract was awarded under full and open competition, but the foreign awardee is a key factor in assessing its effectiveness.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the foreign awardee and the specific nature of the M1151 vehicles. The price of approximately $27.7 million for a single award suggests a significant investment. Without comparable domestic contracts or detailed cost breakdowns, it's difficult to definitively assess if this represents good value for money. The fixed-price contract type provides some cost certainty, but the overall value proposition is clouded by the foreign awardee and the apparent mismatch with the stated service category.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were theoretically allowed to compete. However, the fact that the award went to a 'MISCELLANEOUS FOREIGN AWARDEES' entity raises questions about the breadth and effectiveness of the competition. It's unclear if domestic companies were unable or unwilling to bid, or if the foreign entity offered a uniquely advantageous proposal. The limited information available makes it difficult to assess the true level of competition and its impact on price discovery.

Taxpayer Impact: Taxpayers may have received a competitive price due to the open competition, but the foreign awardee could also indicate a lack of domestic industrial capacity or a less transparent pricing structure compared to domestic contracts.

Public Impact

The primary beneficiaries are likely military units requiring M1151 vehicles, enhancing their operational capabilities. The contract delivers specialized vehicles essential for certain military operations. The geographic impact is likely focused on the deployment locations of the benefiting military units, potentially overseas. Workforce implications are minimal for the contracting agency, but the awardee's workforce is directly engaged in fulfilling the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Award to a foreign entity for vehicle procurement raises concerns about domestic industrial base support and potential geopolitical risks.
The service description 'Administrative Management and General Management Consulting Services' appears misaligned with the procurement of physical vehicles, suggesting potential data entry errors or a complex contractual structure.
Limited contract duration (157 days) may indicate a stop-gap measure rather than a long-term strategic procurement, potentially leading to future inefficiencies.
Lack of transparency regarding the foreign awardee's identity and capabilities makes it difficult to assess their reliability and performance history.
The high dollar value for a short-duration contract warrants scrutiny to ensure cost-effectiveness and prevent potential overpayment.

Positive Signals

The contract was awarded under full and open competition, theoretically ensuring the best possible offer was selected.
The firm fixed-price contract type provides cost certainty for the government, mitigating the risk of cost overruns.
The Department of the Army, a major component of the DoD, is the awarding agency, suggesting a significant operational need.
The contract ID (W91GY007C0044) allows for potential future tracking and analysis of performance and spending.

Sector Analysis

This contract falls within the broader defense sector, specifically focusing on the procurement of tactical vehicles. The market for such specialized military equipment is often characterized by limited suppliers, government-driven demand, and stringent technical specifications. While the stated North American Industry Classification System (NAICS) code is 'Administrative Management and General Management Consulting Services' (541611), the actual procurement of M1151 vehicles suggests a discrepancy. Comparable spending benchmarks would typically involve other military vehicle procurements, which can vary significantly based on vehicle type, quantity, and technological sophistication.

Small Business Impact

There is no indication that this contract involved small business set-asides, as the 'sb' field is false. This suggests that the procurement was not specifically targeted to encourage small business participation. Consequently, the direct impact on the small business ecosystem is likely minimal, with no subcontracting opportunities mandated for small businesses through this specific award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army and the Department of Defense. Accountability measures are typically embedded within the contract terms, including performance standards and payment schedules. Transparency is limited by the available public data; further details on the awardee's performance and the specific justification for selecting a foreign entity would enhance oversight. Inspector General jurisdiction may apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Vehicle Procurement
Tactical Wheeled Vehicles
Foreign Military Sales (potential, though not explicitly stated)
Army Logistics and Readiness Programs

Risk Flags

Potential misalignment of NAICS code with contract action.
Award to 'miscellaneous foreign awardees' lacks transparency.
Short contract duration for a high-value item.
Limited information on contractor's track record and capabilities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.7 million to MISCELLANEOUS FOREIGN AWARDEES. {PIIN: W91GY007C0044} UPARMOR M1151 VEHICLES

Who is the contractor on this award?

The obligated recipient is MISCELLANEOUS FOREIGN AWARDEES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $27.7 million.

What is the period of performance?

Start: 2007-08-31. End: 2008-02-04.

What is the specific nature and track record of the 'MISCELLANEOUS FOREIGN AWARDEES' entity that received this contract?

Unfortunately, the provided data only identifies the awardee as 'MISCELLANEOUS FOREIGN AWARDEES,' which is a generic descriptor rather than a specific entity name. This lack of specificity makes it impossible to ascertain the contractor's track record, past performance, financial stability, or any previous experience with the Department of Defense or similar procurements. Further investigation would be required to identify the actual company behind this designation and assess their qualifications and history. Without this information, evaluating the risk associated with this awardee is significantly hampered.

How does the approximate $27.7 million cost for M1151 vehicles compare to similar domestic procurements or market rates?

Directly comparing the $27.7 million cost to similar domestic procurements is challenging without knowing the exact quantity of M1151 vehicles purchased and their specific configurations. The M1151 is an up-armored variant of the HMMWV, and its cost can fluctuate significantly based on upgrades and features. Generally, military vehicle costs are substantial, and fixed-price contracts aim to cap these expenses. However, the award to a foreign entity introduces variables related to international trade, logistics, and potentially different manufacturing costs or profit margins. A thorough benchmark would require access to recent, comparable contracts for similar up-armored HMMWV variants awarded to domestic suppliers to identify any significant price discrepancies.

What are the primary risks associated with awarding a significant vehicle procurement contract to a 'miscellaneous foreign awardee'?

Awarding a contract to a 'miscellaneous foreign awardee' presents several potential risks. These include geopolitical instability in the awardee's country, which could disrupt supply chains or delivery schedules. There are also risks related to intellectual property protection, quality control, and adherence to U.S. military specifications, which might be more challenging to oversee internationally. Furthermore, reliance on foreign suppliers can impact the domestic defense industrial base and potentially lead to less favorable long-term pricing or strategic dependencies. Ensuring compliance with U.S. regulations and ethical standards can also be more complex with foreign entities.

Given the short performance period (157 days), does this contract represent a critical, short-term need or a potential indicator of program instability?

The short performance period of 157 days (approximately five months) for a $27.7 million contract suggests a specific, time-sensitive requirement rather than a long-term strategic acquisition. This could indicate an urgent operational need for these M1151 vehicles, perhaps to replace battle losses or fulfill a deployment deadline. Alternatively, it might represent a bridge contract while a larger, more comprehensive procurement strategy is developed, or it could signal potential instability or changes in a larger program where requirements are being adjusted rapidly. Without further context on the M1151 program's status, it's difficult to definitively categorize the reason for the short duration.

How does the stated NAICS code (541611 - Administrative Management and General Management Consulting Services) align with the procurement of physical vehicles like the M1151?

There appears to be a significant misalignment between the stated NAICS code (541611 - Administrative Management and General Management Consulting Services) and the actual procurement of M1151 vehicles. NAICS 541611 is intended for firms primarily engaged in providing advice and assistance on organizational requirements, operational methods, and management issues. Procuring physical goods like vehicles typically falls under manufacturing (e.g., NAICS 336112 - Light Truck and Utility Vehicle Manufacturing) or wholesale trade (e.g., NAICS 423110 - Automobile and Other Motor Vehicle Merchant Wholesalers). This discrepancy could stem from a data entry error, a complex contractual structure where consulting services are bundled with procurement, or an incorrect classification by the awarding agency. It warrants further investigation to clarify the true nature of the services being procured.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

Product/Service Code: MISCELLANEOUS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2011 CRYSTAL DR STE 911, ARLINGTON, VA, 08

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $27,691,356

Exercised Options: $27,691,356

Current Obligation: $27,691,356

Contract Characteristics

Cost or Pricing Data: NOT OBTAINED - WAIVED

Timeline