CUI M240 Machine Gun Variants_Redacted 62526 Redacted.pdf
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- Attached to
- M240 Series Machine Gun
- Solicitation number
- W15QKN21D0038-P00007
About this file
This is a Justification and Approval (J&A) document for a sole-source procurement of M240 Series Machine Gun (MG) variants under other than full and open competition authority.
The U.S. Army Contracting Command in New Jersey seeks to increase the ceiling of an existing Indefinite Delivery/Indefinite Quantity (IDIQ) contract with Fabrique National America (FN America) for M240B Medium Machine Guns. The total estimated procurement value is $2,622,737.70, with delivery required by February 27, 2027, to support fleet modernization and operational readiness. The M240 Series MG is a 7.62mm gas-operated, air-cooled, belt-fed weapon that has served as the U.S. military's primary medium machine gun since 1977. Multiple variants exist for different applications, including ground infantry use, Bradley Fighting Vehicle secondary armament, Navy and Air Force helicopter installations, and rebuild/overhaul operations. The justification cites Title 10 U.S.C. Section 3204(a)(1) and FAR 6.103-1(c)(2)(ii) as authority, asserting that no other supplies or services will satisfy agency requirements.
The primary constraint limiting competition is FN Herstal's exclusive ownership of the M240 Technical Data Package (TDP) under a licensing agreement restricting manufacture to the United States and Canada only. The document estimates that awarding to an alternative supplier would incur approximately $9.8 million in non-recoverable development costs for establishing manufacturing capability and passing First Article inspection and Initial Production Test requirements. Using an entirely different weapon system would cost approximately $12.5 million and require a minimum 24-month qualification period, creating unacceptable delays that would compromise critical U.S. and allied military capabilities. FN Manufacturing, LLC is identified as the only capable qualified source. Prior procurement history is documented from 2008 through 2021, with all previous awards to either FN Manufacturing or Colt Defense LLC on sole-source or limited-competition bases under the same licensing restrictions. Subcontracting competition will be maximized at the prime contractor level in accordance with FAR 52.244-5 and 52.219-9.
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CUI
license rights granted to the USG, and possesses the personnel, equipment and proven processes to timely satisfy the requirements cited in Section 4.
b. Unacceptable as the primary authority: If the Government were to award the M240 Series MG requirement to a firm ineligible to utilize the FN Herstal owned TDP, it would incur substantial duplication of non-recoverable costs from development of a new system. The M240 Series MG has already been qualified for Department of Defense (DoD) use. As such, it would be a significant duplication of cost to qualify a brand new weapon system, not built to the FN TDP, in comparison to the cost to procure the M240 Series MG Variants to the existing TDP with a contractor other than FN. No savings are expected to be recovered through a subsequent competition given the small value of the existing requirements ($2.6M). Using any gun system other than the M240 Series MG Variants would require additional prototyping, testing, qualification of the new system, logistics and support, and other programmatic activity such as Tech Manual development and procurement of special tools and test equipment. The non-recoverable costs to develop and qualify a new system would be approximately $12.5M. This estimate is based on historical development costs for the Next Generation Squad Weapon (Automatic Rifle) and is outlined in Table A. The non-recoverable costs are somewhat similar for a U.S. and/or Canadian supplier that would utilize the existing M240 Series TDP. In this case, the supplier would have to establish the required manufacturing capability in their facility and develop the required sub-tier supplier base to prepare qualification hardware. Additionally, this supplier would need to successfully pass First Article inspection and testing and an Initial Production Test prior to production approval. This estimate ($9.8M) is based on historical M240 MG program activity and the Independent Government Estimate shown in Table B.
(3) Authority previously cited if less than full and open competition used. FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services will Satisfy Agency Requirements
(4) Paragraph 7 of the previous J&A stated that the Government would compete the action to the fullest extent permitted by the license agreement. The licensing agreement between the USG and FN Herstal granted the M240 technical data rights for the manufacture of weapons in the U.S. and Canada only. As a result of the Market Research, the only contractor that could fulfill the Government’s requirement under the license agreement was FN Manufacturing, LLC.
(5) Not applicable.
(6) No unusual patterns have been identified.
(7) Significant Changes: There are no significant changes. Limited competition was authorized because the license agreement under contract DAAA09-77-C-2018 (as modified 26 May 1992 and 01 January 2001) between the USG and FN Herstal grants the USG the rights to use the M240 Technical Data Package which is available for the manufacture of weapons in the U.S. and Canada only.
FN Manufacturing was awarded the contract on a sole source basis. FN Manufacturing was the only capable source qualified to meet the requirement.
(1) Contract Number W15QKN-15-D-0003-P00015, awarded 7 December 2018
(2) Other Than Full and Open Competition
(3) Authority previously cited if less than full and open competition used. FAR
6.302-1, Only One Responsible Source and No Other Supplies or Services will Satisfy Agency Requirements
(4) Paragraph 7 of the previous Justification and Approval (J&A) f stated that the Government would compete the action to the fullest extent permitted by the license agreement. The licensing agreement between the USG and FN Herstal granted the M240 technical data rights for the manufacture of weapons in the U.S. and Canada only. As a result of Market Research the only contractor that can fulfill the Governments requirement under the license agreement was FN Manufacturing, LLC.
(5) Not applicable.
(6) No unusual patterns have been identified
(7) Significant Changes: There are no significant changes. The license agreements under Contract DAAA09-77-C-2018 (as modified 26 May 1992 and 01 January 2001) between the USG and FN Herstal, restrict the use of the M240 technical data to manufacture weapons and items in the U.S. and Canada. Due to the limitations placed on the USG by the licensing agreement, the USG is not able to solicit or provide the M240 technical data package to sources outside the U.S.
and Canada. The Army received unanticipated funding for additional M240 MGs. FN Manufacturing, LLC was the only capable source qualified to produce the additional M240 weapons without an acceptable delay.
(1) Contract Number W15QKN-15-D-0003, awarded 9 December 2014
Satisfy Agency Requirements
(4) Paragraph 7 of the previous J&A stated that the Government would compete the action to the fullest extent permitted by the license agreement. The licensing agreement between the USG and FN Herstal granted the M240 technical data rights for the manufacture of weapons in the U.S. and Canada only. As a result of the Market Research, the only contractor that could fulfill the Government’s requirement under the license agreement was FN Manufacturing, LLC. FN Manufacturing submitted the sole proposal to the limited competition resulting in a Single Award.
(5) Not applicable.
(6) No unusual patterns have been identified.
(7) Significant Changes: There are no significant changes. Limited competition was authorized because the license agreement under contract DAAA09-77-C-2018 (as modified 26 May 1992 and 01 January 2001) between the USG and FN Herstal grants the USG the rights to use the M240 Technical Data Package which is available for the manufacture of weapons in the U.S. and Canada only.
FN Manufacturing submitted the sole proposal to the limited competition resulting in a Single Award. FN Manufacturing was the only capable source qualified to meet the requirement.
(1) Contract Number W56HZV-09-D-0175, awarded 27 September 2009
(2) Other Than Full and Open Competition.
(3) Authority previously cited if less than full and open competition used. FAR
6.302-1, Only One Responsible Source and No Other Supplies or Services will Satisfy Agency Requirements
(4) Paragraph 7 of the previous J&A stated that the Government would compete the action to the fullest extent permitted by the license agreement. The licensing agreement between the USG and FN Herstal granted the M240 technical data rights for the manufacture of weapons in the U.S. and Canada only. A Single Award FY09 IDIQ contract was awarded to Colt Defense LLC for a quantity of 21,949 M240B MGs. A Single Award to Colt Defense LLC represented best value to the Government.
(5) Not applicable.
(6) No unusual patterns have been identified.
(7) Significant Changes: There are no significant changes. Limited competition was authorized because the license agreement under contract DAAA09-77-C-2018 (as modified 26 May 1992 and 01 January 2001) between the USG and FN Herstal grants the USG the rights to use the M240 Technical Data Package which is available for the manufacture of weapons in the U.S. and Canada only.
There were other capable offerors, however, a Single Award to Colt Defense LLC represented best value to the Government.
(1) Contract Number W52H09-08-C-0165, awarded August 2008
Satisfy Agency Requirements
(4) Paragraph 7 of the previous J&A stated that the Government would compete the action to the fullest extent permitted by the license agreement. The licensing agreement between the USG and FN Herstal granted the M240 technical data rights for the manufacture of weapons in the U.S. and Canada only. An FY08 sole source, requirements contract was awarded to FN Manufacturing LLC for a base quantity of 768 M240 variant (coaxial, C, D and E1) MG with a 300% option quantity.
(5) Not applicable.
(6) No unusual patterns have been identified.
(7) Significant Changes: There are no significant changes. A Sole Source
Requirements based contract was authorized as a solid stream of requirements from various FMS customers and other services. At the time, FN Manufacturing was an established and proven producer in continuous MG production and no other producer in the market was making M240 MGs. FN Manufacturing was the only capable source qualified to meet the requirements.
b. Other Facts: Due to the licensing agreement between FNH and the U.S.
Government which restricts the use of the TDP for the manufacture of the weapons to the U.S. and Canada, a secondary authority, FAR 6.302-3, Industrial Mobilization; Engineering, Developmental, or Research Capability; or Expert Services, applies.
12. Technical Certification: I certify that the supporting data under my cognizance which are included in the justification are accurate and complete to the best of my knowledge and belief.
13. Requirements Certification: I certify that the supporting data under my cognizance which are included in the justification are accurate and complete to the best of my knowledge and belief.
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