JA SPRDL119R0271_Redacted.pdf

J&A SPRDL1-19-R-0271/ Previous J&A available

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Agency: Defense Logistics Agency Land Warren (DLA-WRN)

2. Description of Action: This proposed contract action is for a new, firm fixed price three year indefinite delivery, indefinite quantity (IDIQ) long term contract for cylinder heads used in the 6.5L de-tuned diesel engine used in the High Mobility Multi-Purpose Wheeled Vehicle (HMMWV), NSN 2815-01-411-2137. The minimum guaranteed quantity of this long term contract is 174 each and the maximum quantity is 7,800 each with an estimated unit price of

. The estimated minimum value of the contract is and the maximum value is . This action will be funded using Army Working Capital Funds.

3. Description of Supplies/Services: The proposed action is to procure NSN 2815-01-411- 2137, 6.5L Diesel Engine Cylinder Head, from either of the following sources of supply:

AM General LLC

408 S. Byrkit PO Box 728 Mishawaka, IN. 46546

CAGE: 34623

Military Part Number (MPN): 05743222 or 10163726

General Dynamics European Land Systems Unterseestrasse 65 Kreuzlingen, TG 8280 Switzerland

CAGE: S3002

MPN: 0725308

AMC 3. Acquire, for the second or subsequent time, directly from the actual manufacturer.

AMSC D. The data needed to acquire this part competitively is not physically available, it cannot be obtained economically, nor is it possible to draft adequate specifications or any other adequate, economical description of the material for a competitive solicitation. AMCS 3, 4, or 5 are valid.

NSN 2815-01-411-2137 is for the cylinder head used on de-tuned 6.5L internal combustion engine that replaces the 6.2L motor previously installed in the HMMWV. This cylinder head is used on Base, A1 series, A2 as well as M1121 and M1123 HMMWVs. In total this item is used on 36 different configurations of the HMMWV. These are older variants of the HMMWV, sometimes referred to as the legacy models of the HMMWV. A de-tuned 6.5L means that this configuration of the 6.5L produces less power than its capability to replicate the power generation of the 6200c3 engine.

The engine used the HMMWV was originally designed and developed by Detroit Diesel in 1982. At that time, Detroit Diesel was a subsidiary of General Motors. This engine was originally introduced as a 6.2L non-Turbocharged power plant and incorporated into the first HMMWV production run. In 1992, a 6.5L non-Turbo version was developed in as an improvement over the 6.2L in terms of engine performance and power. The 6.5L engine was based on the original 6.2L but incorporated changes to piston and cylinder dimensions to displacement and therefore performance of the engine. In 1995, the Turbocharged 6.5L variant was introduced to further increase engine performance. This engine, and cylinder head, has been used in the HMMWV for 30 years. Finally on or around calendar year 2000, General Motors sold the tooling and production rights for the 6.5L engine to AMG. Since that transition, AMG has been building and supplying engines to the HMMWV production line and fulfilling sustainment requirements. Both companies have demonstrated the capability to provide this item to the Government based on past performance.

4. Authority Cited: The statutory authority permitting other than full and open competition is 10 USC 2304(c)(1), as implemented by FAR 6.302-1, where only one responsible source and no other supplies or services will satisfy agency requirements.

5. Reason for Authority Cited:

a. Background:

As stated in part 3 above, the 6.2L and 6.5L compression driven reciprocating angular momentum generator, otherwise known as a diesel engine, was originally designed and developed by General Motors subsidiary Detroit Diesel for use in General Motors commercial integrated this engine into the HMMWV during the development stage of the vehicle platform.

AM General is the Original Equipment Manufacturer (OEM) of the HMMWV Family of Vehicles (FOV) and GM is the originator of the engine.

The HMMWV program acquisition strategy included a combination of off-the shelf commercial parts, existing ordinance parts and contractor developed parts. This strategy reduced research and development time as well as cost to the HMMWV program. Although the HMMWV FOV has a Technical Data Package (TDP), it was 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. A TDP for the air flow metering and waste extractor unit was not acquired with the vehicle TDP since this item was previously developed by a contractor with their own funding. The technical information for this item is considered proprietary to General Motors as the original developer for the item as well as AM General as the prime contractor for the HMMWV. Additionally, the Government does not have technical data rights to a Technical Data Package (TDP) suitable for a competitive procurement of this cylinder head. Accordingly, only A M General and General Motors have the technical knowledge and expertise required to manufacture this item.

b. Costs:

There are no known funding efforts in progress at this time to acquire the commercially controlled data needed to make NSN 2815-01-411-2137 fully competitive. Consequently there are no current plans to acquire a fully competitive TDP, because funds are not available to acquire the data necessary. There are two approaches that the Government could use to acquire this data and they are as follows:

(i) Research and Development (R&D): To develop a competitive data package through a Research and Development (R&D) effort, procuring proprietary data and qualifying additional sources will entail a significant amount of time, facility resources, man-hours, and funding. Based on past experience with similar efforts the estimated cost to research and develop a compatible product and qualify additional sources exceeds $5.0M with a setback of forty-two (42) months.

Required funding would include $3.5M for personnel to support research, and redevelopment of an item that would perform the same task as this NSN. That $3.5M would also include funding for staff to develop the CAD models and drawings that would be required for any potential vendor to manufacture from.

Add in another $1.5M-$2.0M to develop prototypes to test and validate the Government design that functions identically to the original. If funding for a new start research and development effort became available, the forty-two (42) month process would consist of the following: 12 months to develop requirements, 6 to 12 months in design and prototyping, 12 months to test compatibility and function, and an additional 12 months to write the technical data package and provision the parts. A timeline of the estimated R&D process is shown for clarity.

LTV Engineering estimates the following timeline for R&D:

Requirements development 12 Months Design and prototype development 6 Months Component, safety and system level testing 12 Months Write TDP, technical bulletins and provision parts 12 Months

Estimated Time to research and develop 42 Months

(ii) Reverse Engineering (RE): To reverse engineer, validate the design, procure prototypes for testing and release a competitive data package would entail a significant amount of time, facility resources, man-hours, and funding. Based on past development experience the estimated cost to develop a reverse engineered competitive product is $4.0M, with an estimated delay of no less than thirty-six (36) months. Required funding would include $3.0M for personnel to support reverse engineering and validation of the design as well as fund staff to develop the CAD models and drawings. Add another $1.0M to develop prototypes, test and finalize the product to verify that the newly created item provides equivalent performance when compared against the original. If funding for reverse engineering became available, the thirty-six (36) month process would consist of the following: 3 months to obtain existing parts, 3 months to tear down and understand the design, 6 months to iteratively develop drawings, prototypes and bench test, 12 months to perform system and vehicle level testing, and 12 months to write the technical data package and provision the parts. To complete the reverse engineering process successfully, the Government would have to obtain a sufficient sample size of existing parts to provide a 95% probability and 90% confidence level in the actual size of the existing item to be studied. Once a large enough sample has been collected, the Government would then tear down and understand the design, conduct prototype development and produce the final TDP and associated provisioning documents at a cost of $4.0M. A timeline of the estimated R&D process is shown for clarity.

LTV Engineering estimates the following timeline for RE:

Obtain existing parts 3 Months Tear down and understand the design 3 Months Prototype development 6 Months Component, safety and system level testing 12 Months Write TDP, technical bulletins and provision parts 12 Months

Estimated Time to Reverse Engineer 36 months

In addition to the cost and delay for an R&D action or RE effort, Pd-LTV estimates that it would take approximately one additional year 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 6 months. These estimates are based on similar Government projects. These events combined are estimated to take an additional 12 months after development of the item.

Considering this vehicle configuration is out of production and future vehicle demand is unknown, the costs cited above appear to exceed any potential savings to be realized through a future competitive procurement process.

c. Unacceptable Delay:

If the procurement of the HMMWV Diesel Engine Cylinder Head is delayed until the TDP is bought by the Government and made suitable for a competitive procurement the Government would experience an unacceptable delay of a minimum of two and one half years in fulfilling this requirement. The two and one half year delay is a result of the time required to develop items of equivalent performance explained previously in this document. Further delay in providing this NSN will negatively impact our force readiness and capability to actively support U.S./Coalition efforts, as without the engine the HMMWV would be unable to perform any of its missions. AM General and General Motors are the only sources that can meet the requirements without substantial duplication of cost and without unacceptable delay against this action The approved sources have the requisite technical and engineering expertise to perform all efforts required to provide the NSN identified in this Justification and Approval (J&A). The contractor developed the items identified without assistance from the Government.

Furthermore, if a project to make this item competitive was rushed through the procurement without proper testing and validation, there would be an increased risk of a premature failure of this item in the field which could result in an extensive loss of the equipment through destroyed engines.

6. Efforts to Obtain Competition: The Government does not have a complete TDP required to manufacture the cylinder head or use for competitive procurement and there are no known funding programs active at this time for qualification of additional sources. Interested contractors can seek qualification through the Source Approval Program with the Competition Management Office. Therefore, only AM General and General Motors will be solicited for this effort. This effort will be synopsized in accordance with FAR Part 5.201(c).

7. Actions to Increase Competition: There are no vendors in the process of being qualified for this NSN at this time and none prior to contract award. At this time, there are no current or planned efforts to qualify additional sources due to the fact that the Government does not possess a fully defined and validated TDP for NSN 2815-01-411-2137. AM General and General Motors hold 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. In May of 2019 Engineering reviewed online catalogs and published product literature by manufacturers, and distributors, claiming to provide a suitable product for the HMMWV diesel engine cylinder head.

b. Engineering reviewed previous modernization documentation, various marketing publications to research available offerings that would fulfill the requirement.

However, r requirement at the current price without extensive testing and development listed above.

9. Interested Sources: To date, no other sources have written to express an interest, nor has the Government identified any other source possessing an interest in being an alternate source for this NSN. Sources Sought Notice 2019-387 was posted to FEDBIZOPPS.

Source sought Link:

https://www.fbo.gov/index?s=opportunity&mode=form&id=96418d515a6a4097a8099f3001cb1 333&tab=core&_cview=0

10. Other Facts:

a. Procurement history: SPRDL1-15-D-0010 awarded 01/22/15 to A.M. General

b. Acquisition Data Availability: A Level III Technical Data Package to the cylinder head is not available.

c. Unusual and Compelling Urgency: N/A

11. Technical Certification: I hereby 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.

[ ] $250K to $700K , PD-LTV Chief of Engineering [ X ] $700K to $13.5M , Product Director LTV [ ] $13.5M to $93M , Product Manager JPO JLTV

[ ] >$93 , PEO CS & CSS

POC: Email:

Engineer Name: Date: 5/3/2019 Title: Engineer, Light Tactical Vehicles Signature:

Supervisor Name: Date: 5/15/2019 Title: LTV Chief Engineer Signature:

Supervisor Name: Date: 5/20/2019 Title: Product Director, LTV Signature:

12. Requirement 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: Date: 5/20/19 Title: Item Manager Signature:

Name: Date: 5/20/2019 Title: LTV Group Lead Signature:

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable. Normal acquisition procedures will be followed to determine that 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. This item has been determined to be commercial and therefore certified cost and pricing data will not be required.

Name: Leah Bourdeau Title: Contracting Officer Signature: //s// LCB Date: 24 Jun 2019

14. Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief.

Name: Leah Bourdeau Title: Contracting Officer Signature: //s// LCB Date: 24 Jun 2019

15. Legal Concurrence:

Name:

Signature:

Date: 6/26/19