JA for Abrams STS STSS Plus Up Feb24 V3-Redaction-R5_Redacted.pdf

CMO Control number: 2024-036

DEPARTMENT OF THE ARMY

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity: Army Contracting Command – Detroit Arsenal (ACC-DTA), Michigan is the contracting activity responsible for this action.

2. Description of Action: ACC-DTA proposes to award a Cost-Plus-Fixed-Fee modification to Contract W56HZV-22-C-0012 awarded to General Dynamics Land Systems (GDLS) for an additional 1,144,563 hours of System Technical Support (STS)/Sustainment System Technical Support (SSTS). There is an immediate need to add additional hours in option year three to sustain the contract requirements through August/September 2024 due to unanticipated efforts that exercised hours at a higher rate than anticipated. Efforts such as configuration development, logistics support for

FMS customers, as well as changes in Abrams modernization efforts, were unanticipated requirements that consumed much of the available option hours since award of base contract in FY22.

This modification will ensure continued support for the Abrams Tank Systems Fleet across the acquisition lifecycle, including derivative systems, and Foreign Military Sales (FMS) tanks. The current contract is Cost-Plus-Fixed-Fee (CPFF) with both Level of Effort (LOE) and completion efforts, and this modification will utilize a mixture of Fiscal Year 2023 and 2024 Army Procurement Appropriations (APA), Research, Development, Test and Evaluation (RDT&E), Operation and Maintenance, Army (OMA), Army Working Capital Fund (AWCF), United States Marine Corps (Procurement, Sustainment and RDT&E), and FMS/Psuedo FMS funding.

3. Description of Supply and Services:

The purpose of this modification is to continue to provide engineering and logistics support for the production, fielding, and maintenance of Abrams tanks. Currently, the contract has only hours left to exercise and has burned through in just under two years. The addition of 1,144,563 hours and estimated $99,813,783 will support STS requirements through the end of fiscal year 2024. The proposed contract action will include requirements for services such as Field Service Representatives (FSRs), engineering for previously fielded vehicles, and post-production software maintenance.

Hours are also included for requirements from Army sites and Program Executive Offices (PEO) such as Program Manager (PM) Mission Command for maintenance and upgrade of network equipment, to include supporting updates to fielded network hardware and software.

The STS Engineering support includes:

• Configuration Management

• Field Problem Analysis

• Design and Development of both domestic and FMS Abrams platform improvements and enhancements

• Investigation and Trade Studies

• System Integration consisting of human factors of safety and ergonomics

• Reliability Availability Maintainability (RAM)

• Verification Testing

• Safety Engineering

• Platform Cybersecurity

• Software Development & Support

• Packaging Development

• Technical Data Package (TDP) Maintenance

• Quality Assurance

• Obsolescence Surveillance and Resolution

• Depot Logistics Engineering

• Technical Data Provisioning

• Technical Manual Publications

• Packaging and Packing Preservation

• Modification Work Order (MWO) efforts for Development

The Integrated Logistics Support (ILS) for both fielded and sustainment vehicles includes:

• MWO efforts for hardware installation in the field

• New Equipment Training (NET)

• FSRs and Field Service Technicians (FSTs)

• Material Fielding Team (MFT)

• Fielding and De-processing

In addition, contractor FSRs and FSTs are included to provide technical expertise and maintenance to the Government Materiel Fielding Team and may be located with various Army units, both within the Continental United States (CONUS) and Outside the Continental United States (OCONUS). These contractor personnel will perform vehicle inspections, perform maintenance, assist and provide guidance with vehicle repairs up to the 10/20 standard to include mandatory replacement parts, and advise Government personnel on operations, maintenance, and parts supply.

The Independent Government Cost Estimate (IGCE) for this action is $99,813,783. The additional 1,144,563 hours plus the remaining hours will support the contract to the end of fiscal year 2024.

Hours Total Price

1,144,563 $99,813,783

4. Authority Cited: The statutory authority permitting other than full and open competition for this action is Title 10 United States Code (U.S.C.) Section 3204(a)(1), as implemented by Federal Acquisition Regulation (FAR) 6.302-1 “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.”

Specifically, FAR 6.302-1(a)(2)(iii)(A) provides that “Services may be deemed to be available only from the original source in the case of a follow-on contract for the continued provision of highly specialized services, when it is likely that award to any other source would result in – (A) Substantial duplication of cost to the Government that is not expected to be recovered through competition.”

5. Reasons for Authority Cited:

Background/History: GDLS has been the sole-source contractor for the Abrams Family of Vehicles (FoV) since taking ownership from the original equipment manufacturer (OEM) Chrysler Defense in 1982. Since that time, GDLS has been an integral part of the tanks’ development and upgrades, having developed numerous modifications, which have aided in increasing the tanks’ capability, reliability, and survivability. GDLS is the only source with the engineering expertise (gained from over 37 years of Abrams development, production, and field support) to efficiently and effectively respond to the multitude of mechanical, electrical, and armored structural design issues across these vehicle systems. Awarding to a contractor other than GDLS would result in added expenditures to learn each vehicle system, and would require additional time to respond to field issues, possibly causing vehicles to be dead-lined for indeterminate periods to develop timely and accurate responses to issues that arise.

As the OEM and the sole producer of the Abrams FoV, GDLS is the only contractor with the requisite engineering and logistics experience required to support the vehicles.

The STS/SSTS program involves extensive vehicle support tasks that include Program Management, Logistics, Engineering, Configuration Management, Product Assurance and Test (PAT), and Capability Maturity Model Integration (CMMI) related tasks.

Although, some aspects of the Abrams FoV are organically supportable, such as Post Production Software Support (PPSS) and certain maintenance and repair actions, no other firm except GDLS is capable of meeting all of the Army’s Abrams STS/STSS needs and no other source possesses the technical data and documentation needed to provide engineering and logistics support to the Abrams FoV within the required timeframe. The U.S. Government (USG) does not have the necessary data rights for the full Abrams TDP to provide to a third party. Additionally, GDLS currently maintains configuration control and overall system design of all Abrams derivatives thereof. GDLS is also responsible for obsolescence planning and timely replacement of hardware, software, and firmware. Since there are a significant number of electronic components that frequently become obsolete, it is particularly important that GDLS manage software upgrades to legacy hardware systems.

The Government does not possess the complete technical data package (TDP) nor the complete computer software package to enable competitive engineering support associated with STS/SSTS for the Abrams. The USG does possess enough technical data rights to allow procurement of subsystems and components for the purpose of conducting field modifications to apply technologies that increase capability and/or reliability, but not enough of the complete TDP to ensure that the system, as a whole, is designed and operates in accordance with associated requirements documents and system/subsystem specifications. The USG reached out to GDLS, on 12 February 2024, to obtain a Specifically Negotiated License to create a mutually beneficial license arrangement. GDLS responded on 15 February, declining to submit a Rough Order Magnitude (ROM) or proposal to facilitate a license arrangement to allow the Army to obtain technical data and computer software. The Abrams Government team will continue to address obtaining data and data rights for key readiness-driver components going forward. Without the missing Abrams technical data and computer software, such as interface drawings, data for legacy components, etc., a new contractor cannot provide engineering support to the Abrams vehicle that meets the operational needs.

GDLS has the engineering expertise, along with experienced contractor support personnel and the full TDP capable of developing timely and accurate responses to issues arising on complex software and electrical systems, armor requirements, ammunition, turrets, and system integration of the vehicles. GDLS is the only source capable of providing the engineering and logistics services, as described above in section 3, required to support the tank throughout its lifecycle without experiencing a significant duplication of costs.

Duplication of Cost: Table 2 below depicts the duplication of cost required to prepare another source to perform the Abrams STS/STSS effort. The Government estimates duplication of costs in the amount of . The PM office developed the estimated cost listed in the table below using both combat vehicle history from the Abrams FoV and a bottom-up approach by identifying the tasks to be performed, the number of people needed to execute the effort, and the man-years required to perform the tasks. The estimate also includes the costs for material and costs to run tests at the Government test sites.

Table 2: Duplication of Cost Analysis

Task Cost Ref.

Facilities Development Engineering 5(i)(a)

Facilities Development Logistics 5(i)(b)

Development of required Management competencies

5(ii)(a)

Development of required Engineering competencies

5(ii)(b)

Development of required Production Quality Assurance & Test competencies

5(ii)(c)

Development of required FMS competencies 5(ii)(d)

Development of required Logistics competencies

5(ii)(e)

Materials 5(iii)

Total estimated duplication of cost

Background data for the supporting analysis:

i. Facilities Development:

a. Engineering: Project Manager Main Battle Tank Systems (PM MBTS) based its estimates on the previous FY13 and FY17 STS contracts, of three categories of facilities-based efforts required, such as establishing office space for multiple projects and developing associated System Integration Labs (SILs). Total estimated duplication of cost for this activity is .

b. Logistics: The estimate of the total duplication of cost of in other facilities and equipment costs, is based on an assessment of the logistics products work directives on the current STS contract. This includes warehouse and office space, maintenance shop/bay space, office equipment, testing equipment, shop equipment, and tools.

ii. Development of required competencies:

a. Management competencies: PM MBTS based its estimates on an assessment of six management-based work directives and competencies on the current GDLS STS contract, which includes efforts such as management of engineering projects, configuration control, and obsolescence management. PM MBTS estimates achieving this competency would require a total estimated duplication of cost of

b. Engineering competencies: PM MBTS based its estimates on an assessment of 25 engineering-based work directives and competencies on the current GDLS STS contract, which include specific ongoing engineering efforts and development of specific categories of required engineering expertise such as safety, survivability, systems, and human factors engineering personnel. PM MBTS estimates achieving this competency would require a total estimated duplication of cost of

c. Production Quality Assurance & Test (PQA&T) competencies: PM MBTS based its estimates on an assessment of three PQA&T-based competencies on the current GDLS STS contract, which covers specific

PQA&T efforts and development of required PQA&T expertise such as quality assurance and Reliability, Availability, and Maintainability (RAM) personnel. PM MBTS estimates achieving this competency would require a total estimated duplication of cost of

d. FMS competencies: PM MBTS based its estimates on an assessment of

10 FMS-based work directives and competencies on the current GDLS STS contract, which covers specific FMS efforts and development of required FMS expertise such as FMS vehicle modernization efforts and technical support. PM MBTS estimates achieving this competency would require a total estimated duplication of cost of

e. Logistics competencies: PM MBTS based its estimates on an assessment of the logistics work directives and competencies required on the current Abrams STS contract, which covers both CONUS and OCONUS logistics services. PM MBTS estimates achieving this competency would require a total estimated duplication of cost of

iii. Materials: PM MBTS based its estimates on an assessment of the material required to support each of the 50 work directives and/or competencies mentioned in each of the five separate categories above. Total estimated duplication of cost for material is

The total estimated costs to be recovered through competition do not justify competing the requirement. The Government estimates it would incur approximately in duplicated costs if this effort were competed. Any additional savings would come from negotiated profit or fee, but these savings are insignificant based on the figures identified in the chart above. Significant costs would be required to qualify a new contractor to the level at which GDLS is currently operating. The Government is not aware of any portion of this requirement that could be separately competed and result in a cost savings to the Government.

6. Efforts to Obtain Competition:

a. Effective Competition: For reasons stated in sections 5 and 8, ACC-DTA and PM MBTS do not anticipate effective competition for this acquisition. ACC-DTA published a market survey for this procurement action on SAM.gov. ACC-DTA will publish all notices required by FAR 5.201.

b. Subcontracting Competition: The contract contains FAR clauses 52.244-2 entitled “Subcontracts” and the FAR Clause 52.244-5 entitled “Competition in Subcontracting”. The contractors subcontracting plan is reviewed and approved bi-annually in the eSRS system.

7. Actions to Increase Competition: The Government does not possess the complete TDP nor the complete computer software package to enable competitive re-procurement of the engineering support associated with STS/SSTS for the Abrams. The Government has no plans to increase competition beyond the original synopsis. This action will not be synopsized as it meets an exception under FAR 5.202 (11). GDLS is the developer, integrator, and manufacturer of the Abrams tank vehicle and as such is the only practical source that can provide the technical and logistical support without duplication of cost. However, GDLS will be required to make the maximum use of competition for subcontractors.

8. Market Research: ACC-DTA published a Market Survey to SAM.gov on 12 October 2023; it closed on 13 November 2023. The Market Survey was released to evaluate the capability of new sources to perform the tasks currently included under the STS contract. The Market Survey included questions related to Logistical Support, Engineering Support, Configuration Management, Product Assurance Support, Capability Maturity Model Integration (CMMI) Support, and Obsolescence Support.

ACC-DTA received no responses to the Market Survey, including the OEM (GDLS). In addition, on 04 January 2024, internet searches were conducted by the Contract Specialist on Google and Bing for Abrams STS Services and no other providers were found. The results of this search are included in the contract file.

9. Interested Sources: To date, no other sources have written to express an interest in this acquisition. The Government will evaluate any responses to the market research.

10. Other factors:

a. Procurement history:

i. Abrams STS/SSTS Follow-On Contract (current contract)

1. W56HZV-22-C-0012 was awarded on 28 February 2022

2. Sole-source

3. 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1(a)

4. The Government is not contemplating further competition for the

Abrams system technical support requirement. GDLS is the developer, integrator, and manufacturer of the Abrams tank vehicle and is the only practical source that can provide the technical and logistical support

5. N/A, no prior contract for this requirement was accomplished using full and open competition

6. No unusual patterns

7. No significant changes from this J&A to the previous STS J&A

ii. Abrams STS/SSTS Contract

1. W56HZV-17-C-0067 was awarded on 02 February 2017

2. Sole-source

3. 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1(a)

4. The Government is not contemplating further competition for the

Abrams system technical support requirement. GDLS is the developer, integrator, and manufacturer of the Abrams tank vehicle and is the only practical source that can provide the technical and logistical support

5. N/A, no prior contract for this requirement was accomplished using full and open competition

iii. Abrams STS Contract

1. W56HZV-13-C-0017 was awarded on 07 December 2012

2. Sole-source

3. 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1(a)

4. The Government is not contemplating further competition for the

Abrams system technical support requirement. GDLS is the developer, integrator, and manufacturer of the Abrams tank vehicle and is the only practical source that can provide the technical and logistical support

5. N/A, no prior contract for this requirement was accomplished using full and open competition

11. 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.

TYPED NAME: Marlin Carlsen Date: 21 Feb 24 TITLE: Deputy Project Director Main Battle Tank Systems Signature:

12. 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.

TYPED NAME: Marlin Carlsen Date: 21 Feb 24 TITLE: Deputy Project Director Main Battle Tank Systems Signature:

13. Fair and Reasonable Cost Determination: The negotiated price will be determined fair and reasonable through a combination of Cost Analysis to thoroughly analyze each of the proposed individual cost elements, in addition to conducting a price analysis to ensure the proposed price is consistent with the Independent Government Cost Estimate (IGCE) and actual historical pricing of similar Program Executive Office Ground Combat Systems (PEO GCS) programs. ACC-DTA has a dedicated Pricing Division with trained Cost/Price Analysts and Industrial Specialists who will assist the Procuring Contracting Officer (PCO) by performing the Cost and Price analysis. This analysis will also be supported by a Product Director Main Battle Tank Systems (PM