JA SPRDL1-18-R-0512_Redacted.pdf

J&A SPRDL1-18-R-0512

4. Authority Cited: The statutory authority permitting other than full and open competition is Title 10 United States Code (U.S.C.) Section 2304(c)(1), as implemented by FAR 6.302-1 “Only one responsible source and no other supplies or services will satisfy agency requirements.”

5. Reason for Authority Cited: The XT-1410-5A Cross-Drive Transmission transfers the power from the AVDS-1790-8CR’s engine to make mobility and recovery operations possible. The M88A2 Hercules is a recovery vehicle whose primary role is to extricate combat/tactical vehicles that have been damaged, are stuck, overturned, or are inoperable. Recovery missions can take place during training exercises or while under fire in a combat zone. The M88A2 Hercules secondary role is to aide in the repair or replacement of damaged parts during maintenance operations. It is commonly used to remove/install engines and/or transmissions for the Abrams Family of Vehicles (FOV), Bradley FOV, other M88 FOV and M113 Armored Personnel Carrier. Soldiers would not be able to perform the maintenance required on the aforementioned without the hoisting capabilities of the M88A2.

The primary component of the Transmission XT-1410-5A With Container, Shipping and Storage is the Center Section Transmission, part number 12364781 which is source controlled to Twin Disc Inc. A complete TDP of the Transmission has not been developed for competitive use and is currently owned by Twin Disc Inc. There are currently no plans to acquire a competitive TDP due to lack of funds that would be needed to acquire the data in order to support a competitive acquisition. A prohibitive amount of time and money would be necessary to reverse engineer, procure and test prototypes, and release the design(s). The estimated cost to develop a competitive package for this item through reverse engineering could run as high as $40M and could require an estimated delay of at least 5 years to include fabrication and testing of the prototype hardware and releasing a validated TDP. Added to these costs and delays would be the cost and time it would take to qualify another source. Vehicle level qualification and durability testing would be required to prove out this item if manufactured by a new source at an estimated cost of an additional $3.5M and a delay of approximately 25 months. GVPM was consulted and concurs with these time and cost estimates.

The Government would not be able to recover, through subsequent competition, the additional costs involved in either procuring the proprietary data or reverse engineering the item to create a new and competitive transmission TDP. It is estimated that 10% savings could be achieved by adding another supplier. At the current wash out rate of an average of 20 units per year that cannot be repaired, the current unit cost of and assuming the 10% savings achieved through competition, the annual savings would take over years to offset the estimated $43.5M cost of reverse engineer the item and qualifying another source. Also, a new source qualification would be required to meet the M88A2 Performance Requirements and Specifications for Transmission Assembly document, failure to do so would negatively impact production expectations given the current low stock on hand at ANAD.

Twin Disc Inc. has successfully met the previously mentioned specification and over time has been successful in demonstrating that their Transmission can withstand the rigors demanded by the M88A2 recovery vehicle. The use of an inferior product from another source would not be worth the risk. Based on the latest line of balance sheet (LOB) provided by ILSC, there is going to be a deficit of assets before the end of 2018. Reverse engineering and qualification of a secondary source would result in further procurement delays resulting in a deficit of 32 transmissions by the end of 2020. As a mission critical item for M88 readiness, the Government cannot wait the estimated 5 years to develop a competitive kit TDP and qualify a new source as there is an immediate need for this NSN.

6. Efforts to Obtain Competition:

Based on the detailed rational provided in paragraph 5 above, the Government has no plans to obtain competition for this proposed contractual action. Additional approved vendors will result in minimal additional cost savings in comparison to the additional cost required to qualify additional sources.

7. Actions to Increase Competition: As stated in section 5 above, there is no complete TDP available to support a competitive procurement. Due to the costs associated with developing a competitive TDP that cannot be recovered also stated in section 5, the Government is not actively pursuing the development of a competitive TDP for future procurements. The Government would not be able to recover the $43.5M to reverse engineer the transmissions within a justifiable time frame.

This item does not appear on the Advance Procurement Planning List (APPL) dated 16 January 2018 and also does not appear on Competition Advocate Shopping List (CASL) dated 16 January 2018. Contractors interested in becoming a source for this item need to meet the requirements of the Source Approval Program. This is done at the contractor’s expense, to include vehicle level qualification testing. The TACOM Life Cycle Management Command, Competition Management Office (CMO), is the lead proponent for the Source Approval Program. While interested contractors can contact the CMO for assistance with the Source Approval Program, Engineering requires successful vehicle level qualification testing to support the approval of a new source of supply and the Government has no plans or funding to complete qualification testing at this time. To date, no other sources have approached this office with questions or comments on how to become a qualified source to produce this item.

8. Market Research: Market research was performed by TARDEC Sustainment Engineering on 21 March 2018 by reviewing vendor catalogs and available product literature published by Caterpillar Inc. and Eaton Inc. to determine if commercial items or non-developmental items are available to meet Government's needs or could be modified to meet the Government's needs.

While these two sources manufacture transmissions, they are not drop-in solutions and would require a great deal of engineering effort in order to integrate them into the current M88A2 vehicle platform. Additionally neither Caterpillar Inc. nor Eaton Inc. currently manufacture a compact transmission with the power rating requirements similar to the current XT-1410-5A Transmission currently in use on the M88A2. Further, since neither of these sources have produced this specific item for the M88A2 they have not completed the necessary testing to become a qualified source as described in section 5, which is necessary to insure vehicle compatibility and safety.

TARDEC Engineering confirmed with Twin Disc Inc. that this NSN is still procurable.

Name:

Title: Associate Director, Combat Vehicle Engineering Signature:

Date: 24 May 2018 Email:

Name:

Title: Executive Director, Systems Integration and Engineering Signature:

Date: 24 May 2018 Email:

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.

Name:

Title: Inventory Management Specialist Signature:

Date: 31 May 2018

Name:

Title: Director, Ground Combat Systems R&S Signature:

Date: 6 June 2018

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost for this contract action will be fair and reasonable. Normal acquisition procedures will be followed to determine the contract price is fair and reasonable. The appropriate forms of cost and/or price analysis will be utilized, and negotiations will be conducted if necessary. Certified cost and pricing data will be required.

Name: Eric E. Tucker Title: Contracting Officer Signature: //EET//

Date: 7/30/2018

14. Contracting Officer Certification: This certification shall be made by the contracting officer who will sign the contract resulting from this justification and approval. Include the following statement:

I certify that this justification is accurate and complete to the best of my knowledge and belief.

Name: Eric E. Tucker Title: Contracting Officer Signature: //EET//

Date: 7/30/2018

15. Legal Certification:

Concur:

Date: 08/01/2018

Approval Authority for Acquisitions Equal to or Greater Than $13M.

APPROVAL OF JUSTIFICATION

FOR OTHER THAN FULL AND OPEN COMPETITION

Based on the foregoing Justification, I hereby approve the procurement of the following:

a. Noun: Transmission, Hydraulic, Vehicular

b. NSN: 2520-01-417-4144

c. LTC Minimum Quantity: 6

d. Minimum Estimated Value:

e. LTC Maximum Quantity: 124

g. Estimated Maximum Value:

This action will be awarded under other than full and open competition pursuant to the authority of 10 USC 2304(c)(1) and subject to the availability of funds. This approval is subject to the provision that the property herein described has otherwise been authorized for acquisition.

MARK A. BROWN, SES

Acquisition Executive

BROWN.MARK.AL

BERT.1041175032

Digitally signed by

BROWN.MARK.ALBERT.104117

Date: 2018.08.17 07:38:03 -04'00'