JA-00657_SPRDL1-23-R-0102_FINAL_REDACTED.pdf

SPRDL1-23-R-0102 (JA-00657)

Previous J&A: SPRDL1-20-R-0285 is available.

movement and turns.

NSN 2520-01-574-4828 is the rear differential used in the HMMWV with a serial number of 300,000 or greater. HMMWVs with a 300,000 or greater serial number are also referred to as a Revision B model (Rev B). This designation is indicative of reliability improvements that were implemented into the HMMWV

The improvements realized in this variation of the HMMWV differential have improved the vehicle reliability

The Government does not have the pertinent technical data to enable competitive re-procurement. The Government does not own the necessary intellectual property data rights to the pertinent technical data to enable competitive re-procurement. The rear differential technical data was developed by AM General and Dana Light Axle with Government approval – at vendor expense – for use on the HMMWV. The Government did not acquire any rights to the technical data to enable competition of this item. As such, AM General and Dana Light Axle are the only approved sources for the rear differential. While there is a Tank-Automotive and Armaments Command (TACOM) drawing for the rear differential, the drawing is not fully defined and does not include vendor developed components that were considered the intellectual property of the developer. As such, the Government does not have the technical data needed to consider a product by another manufacturer.

This item can only be installed on the most recent HMMWV variants, serial number 300,000 or higher and is not backward compatible with older HMMWV models. The HMMWV rear differential was originally designed and developed by Dana Light Axle and AM General. The original HMMWV program acquisition strategy incorporated a combination of off-the shelf commercial parts, existing ordinance parts, and contractor developed parts to speed up the acquisition process and allow the Government to own some portions of the HMMWV. However, this is not the full TDP of the vehicle system.

This strategy reduced research and development time as well as overall program cost.

Thus, while the HMMWV has a TDP, it is not all inclusive of every component of the vehicle system. Further, the TDP does not include vendor-developed components that were considered the intellectual property of the developer. Since this item was developed by Dana Light Axle and AM General at their expense, the technical information for this item is proprietary to both firms. As such, the use of such descriptions in the acquisition is essential to the Government’s requirement thereby precluding consideration of a product manufactured by another company.

There are no known funding efforts in progress currently to acquire the commercially owned and controlled data necessary to make NSN 2520-01-574-4828 fully competitive.

Further, because this is a major system component of the HMMWV, the time, cost, and schedule impact associated with a competitive action on every single rear differential purchase would result in a full qualification test for each awarded vendor to validate form, fit and function of the rear differential. This would add unnecessary cost and schedule time to the acquisition of each rear differential of the HMMWV, which is a program that is currently in sustainment.

If the Government attempted a fully competitive procurement for the rear differential, the Government would have the three choices to obtain the necessary information to enable full competition: Research and Development of our own rear differential design, Reverse Engineering of the existing system or simply ask the vendors, in this case Dana / AM General, for a price to purchase the full TDP and rights to use the item competitively.

The Government has tried to obtain the TDP for the rear differential, but the response from both Dana Light Axle and AM General stated that it was not for sale. The Government has two remaining methods to acquire the required data to execute a competitive rear differential purchase as follows:

a. Research and Development (R&D):

Total estimated time to research and develop:

b. Reverse Engineering (RE):

Total estimated time to reverse engineer:

In addition to the cost and delay for an R&D action or an RE effort, the Government estimates that it would take approximately to establish another source and procure these kits on a competitive basis. Specific events would include additional market research, solicitation, evaluation and awarding a contract. Finally, any new source of supply would require component, safety, and system level testing that is estimated to take (estimates based on similar Government projects). These events combined are estimated to take an additional after development of the item.

The Government would not be able to recover, through subsequent competition, the additional costs involved in an RE effort to create a new and competitive TDP in a reasonable amount of time. At the current average usage rate of units each year, a current unit cost of $ and assuming % cost savings achieved through competition, the $ in annual savings would take over 97 years to offset the estimated $ cost of reverse engineering the item and qualifying another source. Costs have been adjusted by an estimated % increase due to inflation and price increases over the last three years.

6. Efforts to Obtain Competition:

a. Effective competition: Due to the reasons cited in section 5 above, the Government is not pursuing competition for this item.

b. Subcontracting competition: Unless the contract is awarded to a small business, the solicitation and resulting contract will include FAR clauses 52.219-8, "Utilization of Small Business Concerns"; 52.244-5, "Competition in Subcontracting"; 52.219-16, "Liquidated Damages--Subcontracting Plan";" and Defense Federal Acquisition Regulation Supplement (DFARS) 252.219-7003, "Small Business Subcontracting Plan (DoD Contracts)," to maximize small business opportunities and utilization.

SOLE SOURCE: Notices required by FAR 5.201 will be posted.

7. Actions to Increase Competition: There are no plans to increase competition for future procurements due to the reasons cited above. There are no vendors in the process of being qualified for this NSN at this time and none prior to contract award.

Currently, there are no planned efforts to qualify additional sources because the Government does not possess a fully defined and validated TDP for NSN 2520-01-574- 4828. AM General and Dana Light Axle are holding the technical data regarding this item. Any vendor that believes they can provide this NSN for a lower cost while meeting the same requirements as the existing item should seek qualification as a secondary source through the Competition Management Office Source Approval Program at their own expense.

8. Market Research: A Sources Sought Notice was posted to SAM.gov on 31 March 2023 and was open for 15 days. No responses were received.

Internet searches for suitable competition were performed as described below:

In May 2023, GVSC Engineering conducted a computer-based online search of known rear differential assembly suppliers looking for published material on a new built rear differential assembly specifically for the HMMWV.

Keyword(s): Rear Differential, HMMWV, rear differential assembly. Links used to conduct market research are listed below:

https://www.eaton.com/Eaton/ProductsbyMarket/Government/Vehicles/MilitaryVehicles/ HMMWV/index.htm https://predatorinc.com/shop/hmmwv-differential-centering-kit/ https://www.jasperengines.com/differentials http://www.g2axle.com/pages/view/core locker https://www.axletech.com/en/products/components https://www.motor.com https://www.mishimoto.com/engineering

Findings: The results of this search did not produce any new companies that would provide a direct replacement rear differential assembly for the HMMWV that is 100% new and not rebuilt that could be installed in the HMMWV without considerable time and effort to adapt the new components. The HMMWV is in sustainment at this time so extensive vehicle system changes to accommodate competition are not funded and are unable to be fielded.

Summary: As a result of the Market Research, it was concluded that the Government does not have enough detailed information to consider similar parts for this specific application on the HMMWV. This rear differential assembly cannot be identified as a commercial-off-the-shelf item.

9. Interested Sources: To date, no additional sources have expressed interest in this item.

10. Other Facts: Procurement History:

Contract Number: SPRDL121C0035 Award Date: 24 September 2021 Contractor: AM General LLC Contract Value: $265,680 Competitive Status: FAR 6.302-1 only one responsible source

Contract Number: SPRDL119C0187 Award Date: 13 May 2019 Contractor: AM General LLC Contract Value: $275,911.02 Competitive Status: FAR 6.302-1 only one responsible source

Contract Number: SPRDL118C0042 Award Date: 25 October 2017 Contractor: AM General LLC Contract Value: $625,049.70 Competitive Status: FAR 6.302-1 only one responsible source

Contract Number: SPRDL117C0070 Award Date: 7 February 2017 Contractor: AM General LLC Contract Value: $171,107.10 Competitive Status: FAR 6.302-1 only one responsible source