28423 QA 3.docx

Question & Answer #3 Motor Vehicles - 28423

This document is posted to capture the questions received during the question & answer period for solicitation 28423, Motor Vehicles. This document is the official response to the questions received.

Questions or responses included in this document require changes to the Exhibit C – Bid Prices. Exhibit C – Bid Prices has been updated on WEBS as Exhibit C – Bid Prices Amendment 3 and all changes are detailed below.

Any additional questions regarding this solicitation must be directed to the Procurement Coordinator listed below.

Brandon Cipolla

(360) 407-7959 Brandon.Cipolla@des.wa.gov

It is important that dealers work with manufactures to determine vehicle order restrictions and supply chain disruptions. The best dealers actively work with manufactures and customers to minimize these disruptions.

Floor Plan interest rate are the amount of interest a dealer pays to a bank for its vehicles that they sell. With the current floor plan interest rates is very difficult for dealers to stock vehicles and still maintain some level of profit after the vehicle is sold. There are certain vehicles lines we do not allow dealers to stock in order to ensure all customers receive fair amount of vehicles.

I am requesting that line “(c) Identify average inventory levels that bidder carries day to day for each of the Contract Categories for which bidder is submitting a bid.” be removed from the performance requirements.

Evaluation is based on competition by category within each manufacturer. If average inventory levels by category are dictated by manufacturer policy, then the requirement will be equalized between dealerships.

For manufacturers that do not control dealer inventory levels, there is value in evaluating average inventory levels.

Bidders may choose to specify the types of vehicles and restrictions on inventory management in the written response.

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Vehicles specifications are contained in Exhibit B-1 - Specifications, and in Exhibit D- Contract beginning on page 28.

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The questions below were answered in Q&A #2 on 16 September 2024

So, does all this come later? Is this first part just submitting A1 through C?

Identified costs may be detailed in the description of the model. The instructions in Exhibit C indicate “Base Price Shall include all customs and duties, OEM destination fee, all Vehicle preparation and clean-up charges, and all other OEM and Dealer incidentals normally included with providing a Vehicle.”

The table in Exhibit D – Contract will be inserted from the awarded bidders Exhibit C, including the MSRP discounts for the awarded categories.

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1. Under ‘Requirements for Motor Vehicles, General Requirements’, does DES want bidders to list the manufacturer components or just state their compliance? For example, Engine/Motor/Drive System, a.) OEM’s standard engine/motor/drive system, should the bidder write down the type of engine, motor and drive system that will be on the vehicle or leave it blank?

If an EV vendor offers several range options, must each range option have its own line item in Exhibit C – Bid Prices, or can they be grouped together in the “description” cell of the Excel document?

For vehicles bids, option models adhering to the same discount percentage may be submitted as a single model. Please note in the description the additional range options included in the base model.

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Can bidders propose changes to Exhibit-D – Contract, and include proposed changes with our bid submission? Is the contract negotiable?

Enterprise Services does not intend to negotiate substantive contract terms and conditions pertaining to the resulting Contracts at contract award. Rather, Enterprise Services intends to provide all awarded bidders with substantively equivalent Contracts absent unique considerations. This approach enhances fairness for all bidders and provides eligible Purchasers with confidence that the resulting Contracts are substantively equivalent.

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Bidders may access the list of eligible purchasers via the link below.

https://apps.des.wa.gov/DESContracts/Home/MCUAListing N

They also must be doing business with a physical location in Washington, inclusive of a showroom and service department.

I ask that you amend this contract to reflect this information.

Could you give me an example how it works if you have two dealers on that manufacture for the cars site

So, does all this come later? Is this first part just submitting A1 through C?

Delivery costs of vehicles and sales tax will be invoiced through the CARS system after award.

The reference in Exhibit D – Contract will be updated at the time of award with the bidders submission in solicitation Exhibit C – Bid Prices.

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Therefore, I request that the bid and resulting contract be amended to remove “Federal governmental agencies or entities” as included in the list below.

Using MSRP less percentage discount appears simpler, but it is a flawed bid strategy for automobile bids, in my opinion. Vehicle models (within same category) have different OEM Manufacturer government incentives (which change every model year based on projected volume), base fleet models vs. better-equipped “retail” trim upgrade models might have varying margins between dealer invoice and MSRP, so a percentage discount off MSRP for an entire category will not work to obtain consistent best pricing. Please note that the bid-required Minimum 1% MSRP Discount could create a negative profit (or loss) to dealer on certain models if they were bid and offered on contract. A cost-plus pricing strategy for both base model and factory options will provide best pricing.

Enterprise services has selected the MSRP discount evaluation methodology after carefully considering other options, including Cost-Plus.

The decision to move away from Cost-Plus for this procurement is based on several factors, including the requirements of FTA Circular 4220.1F. FTS Circular 422.1F and the application of the Common Grant Rules dictates the acceptable type of award structure for State contracts eligible for use with Federal funding. Cost-Plus contracts are expressly forbidden for recipients of these Federal Funds, which would prevent Agencies from utilizing the resulting contracts if utilizing federal funding. Based on these restrictions, Enterprise Services is unable to pursue a Cost-Plus pricing methodology for this procurement.

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The questions below were answered in Q&A #3 on 27 September 2024

Is there also a TIME deadline?

Does the email address above use an automated response (with time/date) or will we be relying on DES personnel to manually send a receipt?

Automated responses will not be provided for submissions. DES personnel will provide a confirmation of receipt to bidders.

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Procurement Coordinator Contract 28423 Contracts & Procurement Division Washington State Department of Enterprise Services P.O. Box 41411 Olympia, WA 98504-1411 Attn: Brandon Cipolla N

Referring to Category Tables provided, please correct Category 9 to show “Heavy Duty Trucks (Class 7)” on the Cost Sheet.

The instructions should say “Base Price after MSRP discount will not be utilized“. This would be the Base Vehicle Price in CARS, right?

Base Price: $27,000

MSRP: $30,000

MSRP Discount %: 10%

The instructions are correct as written.

Exhibit C – Bid Prices Amendment 2, line 17 states: “Provide the base price for informational purposes for each model offered. The base price prior to MSRP discount will not be utilized for evaluation purposes.”

The evaluation will be conducted comparing submitted discount rate (the “MSRP Discount %” portion of the example provided), not the Base Price. Hence, the base price will not be utilized for evaluation purposes.

The submitted Base Price will, however, be used in any resulting contract.

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Under the POINTS AND PRICE EVALUATIONS section of this exhibit is stated “Base Price Shall include . . . OEM destination fee”.

However, under the SHIPPING section of this exhibit is stated “Shipping costs, including all transportation and handling charges shall be added to orders in CARS as a separate line item and should not be included in this price sheet.

These statements seem to be contradictory.

Should the Base Price to be provided on the MSRP discount sheets include the OEM destination fee or not?

Delivery of purchased vehicles will be invoiced individually to customers in the CARS ordering system after award. The Base Price of the vehicle should follow the instructions in exhibit C- “Base Price Shall include all customs and duties, OEM destination fee, all Vehicle preparation and clean-up charges, and all other OEM and Dealer incidentals normally included with providing a Vehicle.”

The base price provided should include fees such as the OEM destination fee.

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Should the MSRP to be provided on the MSRP discount sheets have the OEM destination fee added or not?

(Rev5/8/2023)

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