(REDACTED) JA 2019-006_Redacted.pdf

CMO Control Number: 2019- 006 Family of Heavy Tactical Vehicles Production

Justification Review Document for Other than Full and Open Competition

Program: FAMILY OF HEAVY TACTICAL VEHICLES (FHTV)

Authority: 10 U.S.C. 2304(c)(1), as implemented under FAR 6.302-1

Amount:

Prepared by:

Type Name: Ms. Victoria Sarkisian

Title: Procurement Specialist

Email: victoria.e.sarkisian.civ@mail.mil

Contracting Officer:

Typed Name: Mr. Eric D. Murphy

Email: eric.d.murphy20.civ@mail.mil

Technical Representative:

DSN: 786-5639

Date: 15 November 2018

DSN: 786-5483

Date Reviewed: 19Nov2018

Typed Name: Mr. Joseph M. Keusch

Title: Division Chief, Engineering Transportation Systems

Email: joseph.m.keusch.civ@mail.mil

DSN: 786-8660

Date Reviewed:

20Nov2018

Requirements Representative:

Typed Name: Mr. Robert E. Fletcher

Title: Deputy Project Manager, Transportation Systems

Email: robert.e.fletcher6.civ@mail.mil

DSN: 786-7891

Date Reviewed: 20Nov2018

FOIA

Exemption #4

GMO Control Number: 2019- 006

Reviews: I have reviewed this justification and find it adequate to support other than full and open competition.

Product Manager, Heavy Tactical Vehicles Typed Name: JEFFERY W. JURAND

Lieutenant Colonel, AR

Signature: //Signed//

DSN: 786-8679

Date: 19NOV18

Project Manager, Transportation Systems Typed Name: DANIEL L. FURBER

Colonel, FA

Signature: //Signed//

DSN: 786-5569

Date: 20Nov18

Program Executive Officer Typed Name: Mr. Timothy G. Goddette

Program Executive Officer Combat Service Support

DSN: 786-5105

Signature: //Signed// Date: 19Dec2018

Legal Counsel

Typed Name: Ms. Crystal Monroe

Signature: //Signed//

Alternate Command Advocate for Competition

Typed Name: Ms. Rachel Capaldi

Signature: //Signed//

DSN: 786-7532

Date: 28Nov18

DSN: 786-5153

Date: 28Nov18

Principal Assistant Responsible for Contracting

(PARC)

Typed Name: Daniel J. Gallagher

Signature: //Signed//

DSN: 786-7025

Date: 11Dec18

DEPARTMENT OF THE ARMY

JUSTIFICATION AND APPROVAL FOR OTHER THAN

FULL AND OPEN COMPETITION

1. Contracting Activity: Army Contracting Command - Warren (ACC-WRN) is the contracting activity for this action.

2. Description of Action: ACC-WRN proposes to modify the existing Family of Heavy Tactical Vehicles (FHTV) IV requirements contract W56HZV-15-D-0031 with Oshkosh Defense, LLC. The current five-year contract ordering period is 18 June 2015 through 17 June 2020. Upon approval of this justification, a modification will be issued prior to contract expiration to extend the contract ordering period by three years, from five years to eight years, extending the ordering period through 17 June 2023. The latest vehicle delivery date allowed under the current contract is 18 February 2022, based on a 20-month vehicle production lead time. This contract modification will extend the potential vehicle deliveries through 18 February 2025. Multiple modifications will be issued for continuation of Recapitalization (RECAP) of Heavy Tactical Vehicles as well as the addition of new production vehicles on a Firm Fixed Price (FFP) basis, to include multiple variants of the Family of Heavy Tactical Vehicles (FHTV) and associated kits. The current FHTV IV contract covers placement -of delivery orders for RECAP vehicles and new production trailers through 17 June 2020; however, the procurement of new production FHTVs and RECAP of trailers are not included in the current FHTV IV five-year requirements contract. The Government will fund this action using Other Procurement Army (OPA) funding for Fiscal Year (FY) 21 through FY23 requirements.

3. Description of Supplies/Services: The systems to be acquired under the proposed modifications include both new and RECAP vehicles and new and RECAP trailers. The vehicle variants include the following: Heavy Expanded Mobility Tactical Truck (HEMTT) series to include M977 Light Cargo Truck, M985 Heavy Cargo Truck, M978 Tanker, M984 Wrecker, M983 Patriot Tractor, M983 Light Equipment Transporter (LET), M1120 Load Handling System (LHS), M985 Guided Missile Transport (GMT), M977 Large Repair Parts Transporter (LRPT), M977 Electronic Power Plant (EPP), M1977 Common Bridge Transporter (CBT), Dry Support Bridge (DSB), M1075 Palletized Load System (PLS) truck, M1074 PLS truck, and the M1070 Heavy Equipment Transporter (HET). The trailer variants include the M1076 PLS Trailer (PLS-T) and the M1076 PLS-T with Container Transfer Enhancement (CTE).

The Government plans to continue to acquire associated logistical/engineering/test support and related technical data, repair parts, fielding support, field service representatives, installation services for kits, equipment and ancillary hardware, and configuration management services for the FHTV production vehicles to support Engineering Change Proposals (ECPs). The ancillary hardware includes Basic Issue Items (BII), special tools, specialty kits, kit storage, expeditionary field kits, initial support items, self-recovery winch kits, and extended draw bars. The Government plans to acquire the estimated quantities identified below. The estimated quantities are based on the quantity of vehicles required to achieve the FY25 Structure and Composition System (SACS) fleet quantities, which are validated by HQDA GB, along with estimated user requirements. It should be noted that

***Ordering Year (OY) 6-8 estimates include updated Forward Pricing Rate Recommendations provided by Defense Contract Management Agency (DCMA), and cost adjustments for inflation using Office of the Secretary of Defense inflation indices.

a. This acquisition is for new production and RECAP of the FHTV. The vehicles and trailers are designed to perform logistics support roles in the Army, which are needed to transport fuel, water, ammunition and supplies. Under the RECAP program, HEMTT/PLS trucks and PLS-T are returned to Oshkosh Defense, LLC, when they reach the end of their service life, or have been damaged beyond repair. They are completely disassembled/stripped to the frame, parts/components are rebuilt as necessary, and the vehicles/trailers are integrated with the latest technology upgrades, and reassembled on the production line for a like-new vehicle/trailer. All RECAP vehicles/trailers are delivered with a new vehicle/trailer warranty.

b. The new production and RECAP FHTV will be used to fill critical Army core requirements, based on the quantity of vehicles required to achieve the FY25 Structure and Composition System (SACS) fleet quantities to include Grow the Army Initiatives and European Deterrence Initiative (EDI) estimates. An additional allowance ($1.3B) has been estimated for potential FMS and other customer orders.

4. Authority Cited: The statutory authority permitting other than full and open competition for this action is Title 10 U.S.C. 2304(c)(1), as implemented by Federal Acquisition Regulation (FAR) 6.302-1(a)(2)(ii)(A) and (B), "Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements."

5. Reason for Authority Cited:

a. Background. Oshkosh Defense, LLC, the Original Equipment Manufacturer (OEM), owns the technical data and proprietary processes for all the FHTV vehicle systems/variants. Oshkosh Defense, LLC is the only known source possessing the requisite knowledge, facilities, tooling, and expertise to manufacture and/or recapitalize the HEMTT, PLS, HET and PLS-T within the timeframe required. The Government requested a Rough Order of Magnitude (ROM) from Oshkosh Defense, LLC to procure the Technical Data Package (TOP) for the FHTV on 03 October 2018. In response dated 05 October 2018, Oshkosh Defense, LLC declined to offer a ROM estimate for the FHTV TDP. As a result of Oshkosh Defense, LLC declining to sell the technical data to the Government, only Oshkosh Defense, LLC currently has the technical expertise necessary to produce the required vehicles without resulting in an unacceptable delay.

b. Unacceptable Delay.

(1) Oshkosh Defense, LLC is the sole source manufacturer that has provided vehicles and trailers, along with associated logistical/engineering/test support and related technical data, repair parts, fielding support, field service representatives, installation services for kits, equipment and ancillary hardware, and configuration management services. Any other source would require over eight years to reverse engineer and test 11 each HEMTT variants, two each PLS variants, the HET, the PLS-T variants and all specialty kits. In addition, another source would need to develop RECAP processes, establish sources of supply, update provisioning databases and technical manuals, test, and obtain type classification and full materiel release. An award to another contractor would result in unacceptable program delays and the Government would be unable to fulfill projected FY21 - FY23 requirements to meet critical Grow the U.S. Army, EDI and other Department of Defense (DoD) customer program milestones. Oshkosh Defense, LLC, is the only source possessing the requisite knowledge, TDPs, facilities, tooling, and expertise of processes to build new and RECAP FHTV for this requirement.

(2) A sole source acquisition with the incumbent, Oshkosh Defense, LLC, would result in initial production vehicle deliveries over eight years (estimated at 107 months, which includes concurrent events as noted in the chart below) earlier than an alternate source. Oshkosh Defense, LLC is the only source that can meet the required delivery schedule without an unacceptable delay. Any other source, through a competitive procurement process would conservatively require a 107-month delay to commence initial delivery as described below:

Reference Event Com12etitive (approximately)

(a) Develop P-SPEC/SOW 10 months

(b) Source Selection Evaluation Board (SSEB) 8 months

(c) Contractor Initial Build (New and RECAP) 30 months

(d) Contractor Validation Test 18 months

(e) Development of Technical Drawing 9 months

(f) Logistic Product Development* 60 months

(g) Build Test Assets for Gov't Test and LOG Eval 12 months

(h) Complete Government Testing 20 months

(i) Refine Design and Update TOP* 9 months

(i) Full Materiel Release* 42 months

Total Time First Delivery to the Field 107 months *Events are concurrent with other items on this list.

Based on the rationale below and historical Army experience in its tactical truck programs, including HEMTT, PLS, PLS-T, HET, High Mobility Multipurpose Wheeled Vehicle (HMMWV), and Family of Medium Tactical Vehicles (FMTV); it can be expected that vehicles from a new source would be delayed a minimum of 107 months beyond what can be achieved from the current producer. Even with the earliest potential start for re-procurement action from a new source, the resultant delay of competition would result in a minimum eight-year period with few or no heavy truck family deliveries and significant fielding schedule disruption as detailed in the milestone schedule chart above.

A sole source award to Oshkosh Defense, LLC in the February 2021 timeframe would result in the production and delivery of vehicles/trailers starting by December 2021, compared to deliveries starting in approximately 107 months with a competitive procurement. As indicated by the table above, a competitive procurement would require the following:

(a) Develop Performance Specification (P-SPEC)/Scope of Work (SOW). The approximate time it would take Product Manager, Heavy Tactical Vehicles (PdM HTV) to develop a validated P-SPEC and SOW for all the FHTV vehicle variants and associated kits would be 10 months.

(b) Source Selection Evaluation Board (SSEB). Based on historical averages from the ACC-WRN Source Selection Support Center of Excellence (S3COE) for a procurement of this complexity, the estimated time it takes to conduct a competitive award is eight months. The SSEB process is comprised of staffing and convening an SSEB, conducting all Source Selection activities to include briefings and debriefings through contract award.

(c) Contractor Initial Build (New and RECAP). Shipping of all Government Furnished Equipment (GFE) to Support Reverse Engineering Effort: The estimated time is four months. Vehicle Teardown and Reverse Engineer all Variants and Kits: The estimated time it would take to disassemble all the vehicle -variants and kits, document the disassembly of all variants (including hydraulics, pneumatics, and electrical), dimension and weigh all components, perform materiel analysis of components, identify sources of supply for components, create new components in case the OEM (Oshkosh) is unwilling to supply (Oshkosh TAK-4® suspension, transfer cases, common cab, kits), analyze and test new components for function and durability, assign new Government part numbers for all parts and components, and resolve c9mponent obsolescence issues is conservatively 15 months. The estimated time it takes to build prototypes for 22 HEMTT variants, four PLS variants, two HET tractors, and four PLS Trailers by hand is approximately 11 months. Prior to the build of the vehicles, the materials and parts needed for the build will have to be purchased and components fabricated, welded and assembled based on the provisioning data. Total time for contractor to build prototypes is 30 months.

(d) Contractor Validation and Evaluation. The estimated time it takes for the contractor to verify that the initial prototype trucks, trailers and kits function properly, including resolution of any problems identified during contractor testing prior to the production of the assets needed to support Government testing and logistics review, is 18 months.

(e) TOP/Drawing Development. The estimated time it takes to create a competitive technical data package that can be used by any contractor to produce the vehicle variants or the components of the vehicles is nine months. During the reverse engineering effort, Government part numbers and Commercial and Government Entity (CAGE) codes will be assigned to the components of the vehicles and kits in lieu of OEM (Oshkosh) part numbers. The component dimensions, material composition, surface treatments, finishes, and Government and vendor part numbers and CAGE codes will be added to drawings of the TOP. Weldment and assembly drawings will be created as well as assembly instructions for the vehicles.

(f) Logistics Product Development. The estimated time it takes to establish sources of supply for the vehicle components, associated Government and vendor part numbers and CAGE codes against existing National Stock Numbers (NSNs) in the provisioning database, and establish NSNs and part number associations, as needed is estimated to be 60 months. This information will ultimately be added to the vehicle technical manuals as well as the TOP. Provisioning/NSN assignment can begin during TOP development but will not be finalized until the configuration is locked/TOP completed.

The estimated time it will take to develop final logistics products for 11 each HEMTT variants, two each PLS variants, one HET tractor, two each PLS-T variants, along with associated kits is 50 months. This estimate includes the time it will take to verify and validate all maintenance tasks, technical manuals and provisioning data as a result of Logistics Demonstration, and documentation of changes to the vehicle configuration due to Government Product Verification Testing (PVT). The total logistics time assumes a portion of the current manuals are usable and the new Interactive Automated Development Software (IADS) is in place for this effort. This effort will support the justification for type classification and full materiel release of the vehicle systems and kits which will ultimately support fielding assets to the units.

(g) Build Test Assets for Government Testing and Logistics Evaluation. The estimated time to build 44 each HEMTT/test vehicles, eight PLS test vehicles, four HET test tractors, and eight test trailers in support of Government testing and Logistics Demonstration is a minimum of 12 months. During this time, employees will be training and learning how to assemble the vehicles and kits in accordance with the work instructions to assure a quality product. First Production Vehicle Inspection (FPVI) will be performed by the Government on these assets in accordance with the purchase description prior to full-rate production to assure vehicle functionality and safety.

(h) Complete Government Testing. The estimated time it will take to complete PVT at a Government test facility to verify that the new and RECAP vehicle assets, trailers, and kits meet the performance and reliability of the original HTV vehicle systems in accordance with the P-SPEC is approximately 20 months. Any issues that occur during test will have to be evaluated, corrected, and if necessary, retested for proper function and durability.

(i) Refine Design and Update TOP. The estimated time it takes for the contractor to make updates to the TOP and vehicle design based on their tests and any additional documentation that may be needed for the Government test effort is three months.

The estimated time it will take to update the TOP based on any design changes that resulted out of Government testing and validation, verification, and sign off on the drawing package is six months. The total estimated time to refine design changes and update the TOP is nine months.

(j) Type Classification-Standard (TC-S)/Full Materiel Release (FMR). The estimated time to complete FMR for the subject systems is 42 months. This will include the time it will take to coordinate and obtain approvals/signatures for three TC-S/FMR system

Duplicated Costs Through Competition Reference Category Cost($M)

(a) Government Test Assets $13.0

(b) Government Test Costs $10.6

(c) Technical Data Package $505.4

(d) Logistics Product Development $35.1

$564.1 Million in Identified Additional Costs

(a) Government Test Assets. This category includes all variants of the HEMTT, PLS, PLS-T and HET. One contractor is assumed.

(b) Government Test Costs. This category includes PVT, Live Fire tests and test maintenance support personnel costs.

(c) Technical Data Package. This category includes the estimate for reverse engineering, testing, TOP, assembly instructions, and the facilities, tools, and personnel costs.

(d) Logistics Product Development. This category includes Life Cycle Sustainment Plan (LCSP); Integrated Product Support (IPS); Failure, Mode, Effects, and Criticality Analysis (FEMCA); Reliability-Centered Maintenance (RCM); maintenance planning;

Technical Manuals/Commercial Off-The-Shelf (COTS) analysis; Military Specification (Mil Spec) update; and training materials.

6. Efforts to Obtain and Increase Competition:

a. Effective competition. The Government does not currently have the complete technical data required to compete this requirement and efforts to obtain competition would result in unacceptable delays as explained in paragraph 5.b. above. This proposed action will be synopsized in Federal Business Opportunities (FedBizOpps) as required by FAR 5.201.

b. Subcontracting competition. In accordance with FAR 19.702(a)(1), a subcontracting plan will be required for this action. As such, FAR clauses 52.219-9, Small Business Subcontracting Plan; 52.219-16, ·Liquidated Damages - Subcontracting Plan; and 52.219- 4004, Submission of Subcontracting Plan; will be included in the solicitation. The proposed subcontracting plan will be reviewed and if acceptable, incorporated by reference into the contract. Furthermore, to obtain potential subcontractor competition, this proposed contract action will be synopsized in FedBizOpps as required by FAR 5.201(b). At the subcontract level, maximum emphasis will be placed on the contractor to continue competitive placement of purchase orders/contracts for breakout for spare parts.

Current up-to-date Subcontracting Plan(s) will be required under this effort.

7. Actions to Increase Competition: This three-year extension to the current FHTV IV requirements contract for RECAP and procurement of new production FHTV will enable the U.S. Army to achieve its FY25 SACS fleet quantities; to include Grow the Army Initiative, EDI requirements, U.S. Army and other DoD customer requirements and for the ability to achieve a 100% fleet modernization. Moreover, this contract extension will provide PdM HTV the opportunity to meet the demands of current contingencies and operations, investigate new and emerging technologies to shape the future of FHTV and sustainment, apply new technologies to sustain future forces to include supporting emerging Expedient Leader Follower requirements, and build and maintain resilient and agile logistic products.

For future requirements PdM HTV is awaiting a Strategic Portfolio Analysis Review (SPAR) decision point in FY22 to determine the path forward for the modernization of the FHTV fleet. This three-year contract extension will provide PdM HTV the opportunity to strategize and initiate planning to introduce competition and develop a new modernized fleet of FHTV vehicles based on the SPAR FY22 decision. With the decision point coming in FY22 those decisions would not be fully executed until FY24 at which time the average age of the HEMTT and PLS fleets will be 15 years. Add to 15 years the time required to compete this effort and the age of the fleet would increase to 19 years old. This contract extension will prevent this increase in fleet age while also allowing existing requirements to be fulfilled while waiting for the SPAR decision point and its implementation.

In preparation for the SPAR decision point the U.S. Army is planning to initiate a full and open competition, in the FY24-26 timeframe, for a new family of vehicles. As such, this extension is envisioned to be the final major contracting effort to recapitalize the HEMTT and PLS fleets. This three year competitive development period could lead to follow-on production and testing of a new family of tactical vehicles and associated kits starting in

FY27.

8. Market Research: PdM HTV conducted market research in accordance with FAR 10.002(b)(2) and found no other source capable of providing these vehicles without an unacceptable delay.

a. A Sources Sought Notice was posted by the Government using FedBizOpps from 15 February 2018 to 19 March 2018 to seek possible interested sources for this procurement.

The following three contractors responded to the Sources Sought Notice:

Mack Defense (large business) Navistar Defense (large business) Oshkosh Defense, LLC (large business)

b. Both Navistar Defense and Mack Defense acknowledge that without TOP availability, significant time (as noted in section 5) would be required to provide new production and RECAP vehicles and trailers and would take significant time to develop technical data in addition to the production lead time for long lead materiel to produce assets and perform the required testing. PdM HTV determined that Oshkosh Defense, LLC remains the single responsible source for this procurement based upon the above referenced product management concerns, both pre-contract award and post-contract award, and additional incurred program risk and unacceptable delays with using sources other than the current OEM. Award to any other contractor for this effort would cause an unacceptable delay in fulfilling agency requirements.

c. Representatives from PdM HTV have conducted continuous market research for FHTV programs during this year which include the following: The Tactical Wheeled Vehicle (TWV) Conference sponsored by the National Defense Industrial Association (NOIA); the industry trade conference sponsored by the Association of the U.S. Army (AUSA); and the Michigan Defense Industrial Base Exposition sponsored by NOIA. These are forums where Government and industry representatives from the Tactical Truck business meet and discuss their current products, capabilities, and Government requirements. Oshkosh Defense, LLC, Freightliner, Mack, Navistar Defense, BAE Systems, and General Dynamics represent some industry firms from the heavy payload class of trucks. The representatives from PdM HTV continually meet with companies and review marketing presentations, displays, and commercial literature to develop an in-depth understanding of their products and capabilities. Of these contractors, only Oshkosh Defense, LLC owns the technical data and proprietary processes to manufacture new production and RECAP the HEMTT, PLS, HET and PLS-Trailer, with no logistical impact.

9. Interested Sources: No other sources other than those listed above have expressed interest in this procurement. All interested sources will be considered.

10. Other Facts:

a. Procurement History:

(1) FHTV Production Contracts:

(a) FHTV IV: Contract W56ZV-15-D-0031 was awarded to the OEM, Oshkosh Defense, LLC, on 18 June 2015. Total contract value: $3.2B

(b) FHTV Ill: Contract W56ZV-09-D-0024 was awarded the OEM, Oshkosh Corporation, on 31 October 2008. Total contract value: $7.5B

(2) Previous procurements were awarded on a sole source basis.

(3) Previous procurements for FHTV cited the statutory authority permitting other than full and open competition for the contract was 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1(a)(2)(ii), "Only one responsible source and no other supplies or services will satisfy agency requirements."

(4) At the subcontract level, maximum emphasis is placed on the contractor to continue competitive placement of purchase orders/contracts for breakout of spare parts.

Current up-to-date Subcontracting Plan(s) are required under this effort. Major armor suite kits have or are in the process of being broken out for competitive small business set aside acquisition. Breakout of components for competition is ongoing for the HEMTTA4/PLSA1 Long-Term Armor Strategy (LTAS) B-Kit; HET Urban Survivability Kit (HUSK);

HEMTTA4/PLSA1 LTAS Weapon System Interface Ring (WSIR) Kit; HEMTT M978A4 Tanker Armor Module (TAM) Kit; Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C41SR) Interface Kit; and HEMTTA4/PLSA1 C-Kit Underbody Armor.

(5) No prior contracts for this requirement were accomplished using full and open competition.

(6) The original FHTV IV Justification and Approval (J&A) for Other Than Full and Open Competition was approved on a FFP basis with an estimated total value of $821.6M on 19 March 2013. During negotiations, the contract type was changed to Fixed Price Incentive-Firm Target (FPI-F) to support implementation of the Better Buying Power initiative. On 18 December 2014, the Government informed Oshkosh Defense, LLC that the contract type was converting from FFP to FPI-F. The FHTV IV contract was awarded on 18 June 2015 on an FPI-F basis. A delay in contract award was caused by a delay in proposal submission, multiple proposal submissions (continuous and break-in-production pricing), and the change in contract type from FFP to FPI-F. Due to this delay, multiple years of funding were awarded (FY13-FY15) in OY 1. As a result, in the first of five OYs, the Government obligated nearly 82% ($673.4M) of the estimated J&A value of $821.687M. As a result, the estimated total contract value increased by $2,407,151,000 from $821,687,000 to $3,228,838,000. On 15 March 2017, J&A Amendment was approved for the increase, based on the statutory exception, award to any other source would result in an unacceptable delay in fulfilling the agency's requirements.

(7) The justifications for all previous FHTV requirements listed above cite only one source pursuant to FAR 6.302-1 and there are no significant changes to this circumstance.

b. Other Facts. PdM HTV is awaiting a Strategic Portfolio Analysis Review (SPAR) Decision Point in FY22 to determine the path forward for the modernization of the FHTV fleet. This three-year contract extension will provide PdM HTV the opportunity to strategize and initiate planning to introduce competition and develop a new modernized fleet of FHTV vehicles based on the SPAR FY22 decision.

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: Mr. Joseph M. Keusch

Title: Engineering Division Chief, Transportation Systems

Signature: //Signed//

Date: 20Nov18

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: Mr. Robert E. Fletcher

Title: Deputy Project Manager, Transportation Systems

Signature: //Signed//

Date: 20Nov18

13. Fair and Reasonable Cost Determination: The negotiated price will be determined fair and reasonable through a combination of cost analysis, which will thoroughly analyze each of the proposed individual cost elements, in addition to conducting a price analysis to ensure that the price agreement is consistent with the Independent Government Cost Estimate (IGCE) and/or historical pricing for similar items. ACC-WRN has a dedicated Pricing Division with trained Cost/Price Analysts and Industrial Specialists who will assist the Contracting Officer by performing the Cost and Price analysis. PdM HTV will also support this analysis with a technical review. The Contracting Officer will request that engineers or similar personnel familiar with the end item review labor types and quantities as well as material kinds and quantities to ensure that what is proposed is fair and reasonable. ACC-WRN will request Defense Contract Audit Agency (DCAA) and DCMA expertise and audit support for input. The ACC-WRN Cost/Price Analyst will use the recommendations contained in the DCAA Audit, DCMA Technical report, and/or Program Office engineering technical report to develop a recommended negotiating position. The Government's recommended negotiation position will be detailed in the Business Clearance Review document, which will be reviewed and approved by both ACC- WRN senior leadership and the Principal Director, Defense Pricing and Contract prior to the start of negotiations. Certified Cost or Pricing Data will be required and will form the basis for this analysis. ACC-WRN will document the results of negotiations, and the detailed Price Fair and Reasonable determination from the Contracting Officer, in a Price Negotiation Memorandum (PNM) that ACC-WRN senior Contracting personnel within the Pricing Division will review and concur upon.

I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable based on cost analysis and negotiations.

Certified cost or pricing data will be required in accordance with FAR 15.403.

Typed Name: Mr. Eric D. Murphy

Title: Contracting Officer

Signature: //Signed//

Date: 19 Nov 2018

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

Typed Name: Mr. Eric D. Murphy Signature: //Signed//

Title: Contracting Officer Date: 19 Nov 2018

APPROVAL

Based on the foregoing justification, I hereby approve the proposed modification to Contract No. W56HZV-15-D0031 that would extend the contract by three years for the procurement of the Family of Heavy Tactical Vehicles on an Other Than Full and Open Competition basis pursuant to the authority of Title 10, United States Code, Section 2304(c)(1) as implemented by Federal Acquisition Regulation 6.302-1(a)(2)(ii)(A) and (8), "Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements." The approval is subject to the availability of funds, and provided that the services and property herein described have otherwise been authorized for acquisition.

The total estimated value of this procurement is and the anticipated requirements contract ordering period extension is 18 June 2020 through 17 June 2023.

27 Feb 2019 Date

//Signed// Bruce D. Jette Senior Procurement Executive

FOIA Exemption #4