REDACTED JA 2020-036.pdf

CMO Control Number: 2020-036 Family of Medium Tactical Vehicles A1P2 Production

DEPARTMENT OF THE ARMY

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

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

2. Description of Action: This proposed action will include a modification to the existing Family of Medium Tactical Vehicle (FMTV) A1P2 production Requirements contract W56HZV-09-D-0159 with Oshkosh Defense, LLC. The Government plans to award additional Fiscal Year (FY) 2019 Hardware and Service requirements with multiple Firm-Fixed Price (FFP) contract actions (Modifications to existing Delivery Orders). The total estimated amount of these requirements is $49.9M. Anticipated funding for this action will be FY 2017, FY 2018 and FY 2019 Other Procurement Army (OPA) and Foreign Military Sales (FMS) funds. Funding is available for obligation under

31 USC 1558.

The Government has a ten-year Requirements contract with Oshkosh Defense, LLC (Oshkosh), of Oshkosh, WI, to procure hardware and services. The contract expired for ordering on 25 August 2019, though deliveries are currently scheduled to continue through April 2021. This action extends the ordering period beyond ten years by an effective 49 calendar days and adds an estimated $49.9M in FY 2019 FMTV requirements resulting in a total estimated contract value of $6.52 Billion. The additional funding will procure an estimated 168 FMTVs, B-kit armor installation for up to 65 FMTVs, B-Kit storage for three months for up to 200 kits and Program Management Support services on a FFP basis in support of Army, Air Force and Foreign Military Sales (FMS), and will close out production of the A1P2 configuration.

3. Description of Supplies/Services: The FMTV is comprised of several variants of the 5-ton Medium Tactical Vehicle (MTV) and 2 ½ ton Light Medium Tactical Vehicle (LMTV). FMTVs are multi-purpose transport and utility vehicles that provide for rapidly deployable worldwide operations on primary and secondary roads, trails, cross-country terrain, and are operable in all weather and climatic conditions. FMTVs provide for combat operations and civil disaster relief necessary for use by the active and National Guard reserve components of the Armed Forces for homeland defense missions, domestic emergency responses, and providing military support to civil authorities. The vehicles operate throughout the theater as a multi-purpose transportation vehicle used by combat, combat support, and combat service support units. The Army needs FMTV variants built to the current A1P2 Technical Data Package (TDP) to supplement the aging 2 ½ and 5 ton truck fleet, and fulfill Army, Air Force and FMS requirements. The current A1P2 TDP includes the incorporation of the Long Term Armor Strategy (LTAS) design on the trucks. LTAS vehicles replace the previous configuration Low Signature Armored Cabs (LSAC) vehicles and incorporate secure lighting, the latest Test Measurement and Diagnostic Equipment (TMDE), live power take-off (LPTO), and provisions for mounting self-defense weapons.

The following is the estimated vehicle model mix for the estimated total quantity of 168 vehicles:

FY 2019 Estimated Remaining Requirements: 57 M1078A1P2, 50 M1083A1P2, 15 M1084A1P2, 6 M1085A1P2, 15 M1086A1P2, 13 M1087A1P2, 5 M1089A1P2 and 7 M1148.

The above lists the estimated vehicle model mix for the estimated remaining FY 2019 requirements; however, any of the following FMTV models or kits (also referred to as various hardware) for production may be included in the contract:

M1078A1P2 2320-01-549-8577 LMTV Cargo M1078A1P2 2320-01-549-8611 LMTV Cargo with winch M1079A1P2 2320-01-552-7745 LMTV Van M1079A1P2 2320-01-552-7749 LMTV Van with winch M1080A1P2 2320-01-552-7791 LMTV Chassis M1081A1 2320-01-447-3882 2.5 Ton Cargo LVAD M1081A1 2320-01-447-3883 2.5 Ton Cargo LVAD with winch M1083A1P2 2320-01-549-8610 MTV Cargo M1083A1P2 2320-01-549-8565 MTV Cargo with winch M1084A1P2 2320-01-552-7739 MTV Cargo with MHE* M1084A1P2/RSV 2320-01-552-7767 MTV Cargo with MHE* (HIMARS RSV) M1085A1P2 2320-01-552-7773 MTV Cargo, LWB** M1085A1P2 2320-01-552-7770 MTV LWB** Cargo with winch M1085A1P2 2320-01-552-7770 MTV LWB** Cargo w/ Sideboard Delete M1086A1P2 2320-01-552-7780 MTV LWB** Cargo with MHE M1086A1P2 2320-01-552-7776 MTV LWB** Cargo with MHE & winch M1087A1P2 2320-01-552-7781 MTV Expansible Van M1088A1P2 2320-01-552-7759 MTV Tractor M1088A1P2 2320-01-552-7753 MTV Tractor with winch M1089A1P2 2320-01-595-3994 MTV Wrecker M1092A1P2 2320-01-552-7793 MTV Chassis M1093A1 2320-01-447-3889 5 Ton Cargo LVAD M1093A1 2320-01-447-6342 5 Ton Cargo LVAD with winch M1094A1 2320-01-447-3896 5 Ton Dump LVAD M1094A1 2320-01-447-3898 5 Ton Dump LVAD with winch M1096A1P2 2320-01-552-7796 MTV LWB** Chassis M1148A1P2 2320-01-557-4546 LHS Truck M1157A1P2 2320-01-552-7787 10 Ton Dump

M1157A1P2 2320-01-552-7782 10 Ton Dump with winch M1273A1P2 2320-01-621-6239 MTV 10 Ton Chassis

* Material Handling Equipment (MHE) ** Long Wheel Base (LWB)

The following are estimated quantities and estimated dollar amounts of separate line items that may also be ordered:

B-Kit Installation (FFP) – 65 Installs (FFP): $0.2M Program Management Support (FFP): $2.5M

The table below provides a summary breakdown of the total estimated quantities and dollar amounts of items included in this Justification and Approval (J&A):

Item/Service Estimated Quantities Estimated Total Cost Vehicles 168 Vehicles $ 47.2M B-Kit Installation* 65 Installs $ 0.2M Program Management Support 1 Lot $ 2.5M

TOTAL: $ 49.9M

*Includes estimated costs for B-Kit Storage for up to 200 Kits

The contract and vehicle price will include the following types of warranties:

Hand-Off Warranty Pass-Through Warranties Systemic Defect Warranty

4. Authority Cited: The statutory authority permitting other than full and open competition is Title 10 United States Code (U.S.C.) 2304(c)(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)(ii)(B) provides that “supplies may be deemed to be available only from the original source in the case of follow-on contracts for the continued development or production of a major system or highly specialized equipment, including major components thereof, when it is likely that award to any other source would result in - (B) Unacceptable delays in fulfilling the agency’s requirements

5. Reason for Authority Cited:

a. Background

The Government possesses and maintains a production level TDP with unlimited rights in its use for the FMTV A1P2 configuration and has previously used it, along with a Performance Specification, to compete FMTV A1P2 requirements. However, an unacceptable delay, explained below, will occur if this contract action is competed.

The Army competitively awarded a seven year (five base plus two option years) requirements contract to Oshkosh for the upgraded A2 configuration FMTV on 7 February 2018. Oshkosh will produce the FMTV A2 utilizing the current A1P2 TDP and A2 Performance Specification, and shall integrate Engineering Change Proposals (ECP) that include higher capacity suspension, wheels and tires; underbody protection;

increase in engine power; higher capacity alternator; data bus upgrade; and safety enhancements. Delivery of first production vehicle is estimated to occur in FY 2022.

The Government will receive a fully competitive A2 TDP as a deliverable under the A2 contract allowing for competition once the competed contract expires.

On 8 July 2019, Navistar Defense LLC filed a Government Accountability Office (GAO) protest related to the June 2019 amendment of the September 2016 FMTV A1P2 J&A.

This resulted in the inability to place any orders for additional validated requirements while the Army awaited a ruling on the protest. Navistar subsequently withdrew its GAO protest on 23 August 2019 and filed two protests with the Court of Federal Claims (COFC) on 26 August 2019. As a result of these protests, the Army was unable to place any orders for the remaining requirements received during the protest period, which lasted beyond the 25 August 2019 FMTV A1P2 contract expiration date. On 13 December 2019, the COFC ruled in favor of the Army on both of Navistar’s protests.

A need exists to continue to equip and provide Army and Air Force customers, as well as FMS countries with survivability-enhanced A1P2 vehicles to meet emerging threats and other potential needs until A2 production begins, currently estimated to begin in FY 2022. This contract action allows the Government to complete the placement of the remaining A1P2 requirements received prior to the expiration of the contract ordering period, and bridge the production gap between the 25 August 2019 A1P2 contract end date and the realization of A2 new production article delivery in FY 2022. This action will extend the ordering authority under the contract for an additional 49 calendar days after execution of the modification to allow for the placement of the final estimated requirements received prior to the expiration of the contract (for example, if executed on 28 Feb 2020, the last date of ordering would be no later than 17 April 2020). This action does not extend the last date of delivery which is currently no later than 25 August 2021.

b. Unacceptable Delay

1) The identified estimated FY 2019 requirement quantities to support Army, Air

Force and FMS customers is 168 vehicles. These customers utilize the FMTV as either its prime mover, a component of their end item or a platform for its system, such as Sentinel, CPI2 and MDTF. A listing of the customers (system/requirements office) and their anticipated requirement quantities is as follows:

SYSTEM/RQMTS OFFICE TOTAL

Army Sentinel 17 Army CPI2 23 Army MDTF 2 Eighth Army 32 Air Force 37 Pseudo FMS Argentina 18 Pseudo FMS Lebanon 33 Pseudo FMS Nigeria 6

TOTAL 168

a) The Navistar protests caused a delay in awarding the remaining estimated FY 2019 requirements on the existing FMTV A1P2 contract prior to the contract expiration date. The inability to award these final requirements on the existing FMTV A1P2 contract will cause an even further delay as the Army would have to order the remaining estimated FY 2019 requirements under the FMTV A2 contract with new deliveries not estimated to begin until FY 2022. Failure to continue to help meet Army and customers’ requirements until A2 production begins in FY 2022 will result in their inability to move goods, equipment and Soldiers around Continental United States (CONUS) and Outside Continental United States (OCONUS), as well as create end systems used to protect the warfighter and the nations it defends. There are currently not enough existing LTAS vehicles to meet the training and mission needs for these customers.

b) If the Army is unable to provide continued support for all Army unit and customers for the remaining FY 2019 requirements, an unacceptable delay will occur resulting in the endangerment of Soldiers who rely on the vehicles to move cargo, equipment and troops in, out and within theater. Delaying the ability to receive vehicles until FY 2022 affects the ability to build systems and fulfill their missions, including replenishment and contingency operations

2) In order to support the Army, Air Force and FMS requirements, the Government requires that the vehicles are available beginning in the September 2020 timeframe in order to adequately protect the Soldier against emerging threats. Timely delivery of new vehicles is required in order to equip the Soldier with survivability-enhanced vehicles to meet emerging threats and potential needs of the Army, Air Force and FMS allies. These vehicles will equip deployed, deploying, or operating units within the Army, Air Force FMS community with armored capable platforms. The goal is to ensure Soldiers receive the right vehicles, with the right capabilities, at the right time.

As detailed below, a competitive effort would result in an unacceptable delay beginning in September 2020 in fulfilling this requirement.

3) According to Product Manager Multi-Mission Protected Vehicle Systems (PdM MPVS) Engineering, it will take approximately 17-19 months for a new vendor to build and provide test support vehicles for the FMTV after contract award. The vehicle testing will take an additional 9-12 months to complete. Government vehicle testing is required to validate the vehicles meet the performance specification. Vehicle testing includes Reliability, Availability, and Maintainability (RAM), Performance, Live Fire Test & Evaluation (LFT&E), and Operational Test & Evaluation (OT&E). Successful completion of testing will allow for materiel release (MR). MR allows full rate production to begin. It takes approximately an additional 12 months for the first production vehicle to come off the production line with initial delivery not expected until October 2024.

Substantial delays to supply vehicles to both CONUS and OCONUS will occur beginning in September 2020 if the Government awards the remaining FY 2019 requirements to a contractor other than Oshkosh. This delay will severely impact the Army’s ability to equip the Soldier with the required armor capable vehicles.

Operations Security Exemption

7. Actions to Increase Competition: The Army competitively awarded a seven year (five base plus two option years) requirements contract to Oshkosh for the upgraded A2 configuration FMTV on 7 February 2018. Oshkosh will produce the FMTV A2 utilizing the current A1P2 TDP and A2 Performance Specification, and shall integrate Engineering Change Proposals (ECP) that include higher capacity suspension, wheels and tires; underbody protection; increase in engine power; higher capacity alternator;

data bus upgrade; and safety enhancements. The Government will receive a fully competitive A2 TDP as a deliverable under the A2 contract allowing for future competition once the current A2 contract expires. This contract action for FMTV A1P2 requirements will utilize the current A1P2 TDP and current A1P2 Performance Specification and will close out A1P2 production. This is the last planned production procurement of the FMTV A1P2 for US Government requirements.

8. Market Research: PdM MPVS conducted market research in January 2020 to identify sources considered viable competitors for the production of FMTVs. On 7 January 2020, ACC-DTA posted a Sources Sought Notice on Beta.SAM.gov for the production of FMTVs. The notice closed on 23 January 2020 and resulted in two responses. See table below. Both respondents were large businesses. The Government considers only one of the businesses capable of producing the FMTV A1P2 requirement. One of the companies has substantial experience producing military trucks and the other has no experience.

Sources Sought Information

Vendor Name Location Capability Oshkosh Defense, LLC

Oshkosh, WI Since 2010, Oshkosh has been the U.S. Army’s Original Equipment Manufacturer (OEM) for the FMTV. In that time, Oshkosh has produced and delivered more than 29,000 FMTVs.

Oshkosh is very capable of meeting the contract requirements and has already delivered the FMTV A1P2 variants cited in this J&A.

Kratos C5ISR Modular Systems

Dallastown, PA Has been a leading designer and manufacturer of tactical shelter systems and specialty enclosures for over 50 years. May be capable of producing the FMTV Shelter that attaches to the FMTV M1087.

Has no experience producing military trucks and is not capable of producing the required FMTVs.

While only two businesses responded to the January 2020 Sources Sought Notice, based on previous market research conducted in August 2015, and revalidated in June 2019,PdM MPVS is aware of other contractor entities that may possess the knowledge and expertise associated with producing the FMTVs. The table below lists additional companies that may be capable of producing FMTVs. However, none except Oshkosh Defense, LLC can produce the needed FMTVs to meet the vehicle requirement and ensure there is no delay in fielding FMTVs.

Vendor Name Location Capability Mack Defense Allentown, PA Produced several truck and tractor variants for

FMS customers.

Navistar Lisle, IL Manufacturer of the MaxxPro Mine Resistant Ambush Protected (MRAP) vehicle. Navistar provides survivability and armor solutions from their high-mobility medium tactical vehicle.

AM General Mishawaka, IN Produced the High Mobility Multipurpose wheeled Vehicle (HMMWV) for over 30 years.

The HMMWV is a light tactical vehicle, a medium tactical vehicle could be conceivably manufactured by AM General.

9. Interested Sources: As indicated above, four known contractors are capable or may be capable of meeting the requirements for the FMTV contract. However, for the reasons stated in paragraph 5(b) above, awarding the remaining FY 2019 requirements competitively creates an unacceptable delay.

The Government will post contract modifications to the FBO website in compliance with the requirements of FAR 5.201.

10. Other Facts:

a) Procurement History: Oshkosh currently produces the FMTV under contract W56HZV-09-D-0159, awarded in August 2009. The contract contains options for corresponding kits and STS efforts. Through 25 August 2019, the Government has awarded 40,563 vehicles, B-Kits and STS efforts with a dollar value of $6.46B under this contract. A full history is provided in a chronological list below, beginning with the most recent action.

1) The Government awarded W56HZV-09-D-0159/P00052 on 30 September 2016, as a sole source action extending the current FMTV base contract expiration date from 30 September 2016 to 25 August 2019. The Government awarded multiple sole source contract actions between 1 October 2016 and 25 August 2019 for FY 2017 through FY 2019 vehicle requirements.

a) The Assistant Secretary of the Army (Acquisition, Logistics and

Technology), approved J&A, CMO Control Number 2016-089, on 19 September 2016.

The J&A was approved utilizing FAR 6.302-1(a)(2)(ii)(A), “Substantial duplication of cost to the Government that is not expected to be recovered through competition” and FAR 6.302-1(a)(2)(ii)(B), “Unacceptable delays in fulfilling the agency’s requirements.” The J&A supports the sole source procurement of FY 2017 – FY 2019 FMTV requirements under contract W56HZV-09-D-0159.

b) Paragraph 7 of the J&A, CMO Control Number 2016-089 stated that the Army will award a competitive contract to produce upgraded A2 configuration vehicles.

At the time of J&A approval, the Government was finalizing the requirements package for a FY 2017 - FY 2023 competitive solicitation and contract award for the upgraded A2 configuration. The Army competitively awarded a seven year (five base plus two option years) requirements contract to Oshkosh for the upgraded A2 configuration FMTV on 7 February 2018.

c) Amendment 0001 to the J&A, CMO Control Number 2016-089, was executed on 20 June 2019 by the Senior Procurement Executive. This amendment 0001 administratively increased the estimated value of the J&A to $895 Million for an estimated contract total of $6.56 Billion. This J&A action does not add new requirements beyond Amendment 0001, but reflects those requirements which were unable to be awarded, as discussed in paragraph 5, above. Differences in the estimated contract total between the J&As are due to actual versus projected obligations.

2) The Government awarded two separate sole source contract actions for FY

2016 FMTV requirements. The Army awarded the first, W56HZV-09-D-0159, Delivery Order 0009, Modification 02, on 23 September 2016. The Army awarded the second, Delivery Order 0009, Modification 03, on 28 September 2016.

a) The Assistant Secretary of the Army (Acquisition, Logistics and

Technology), approved J&A, CMO Control Number 2015-144, on 29 January 2016.

The J&A was approved utilizing FAR 6.302-1(a)(2)(ii)(A), “Substantial duplication of cost to the Government that is not expected to be recovered through competition” and FAR 6.302-1(a)(2)(ii)(B), “Unacceptable delays in fulfilling the agency’s requirements.” The J&A supports the sole source procurement of FY 2016 FMTV requirements under contract W56HZV-09-D-0159.

3) The Government awarded W56HZV-09-D-0159/P00044 on 29 September

2015, as a sole source action extending the current FMTV base contract expiration date to 30 September 2016 and awarding FY16 STS rates. Delivery of STS services extend through March 2018.

a) The U.S. Army TACOM LCMC Competition Advocate, approved the J&A

(Control Number 2015-131) supporting W56HZV-09-D-0159/P00044 on 24 July 2015.

The J&A was approved utilizing FAR 6.302-1(a)(2)(ii)(B), “Unacceptable delays in fulfilling the agency’s requirements.”

4) The Government awarded W56HZV-09-D-0159/P00034 on 29 September 2014, as a sole source action extending the base contract expiration date to 30 September 2015 and awarding FY 2015 vehicle pricing and STS rates.

a) The Commanding General, Army Contracting Command approved J&A, CMO Control Number 2014-145 supporting W56HZV-09-D-0159/P00034 on 8 September 2014. The J&A was approved utilizing FAR 6.302-1(a)(2)(ii)(A), “Substantial duplication of cost to the Government that is not expected to be recovered through competition.” The Government estimated $29.4M of duplicated costs if the contract associated with W56HZV-09-D-0159/P00034 would have been competed full and open.

The $29.4M represented 34.6% of the total cost of the effort.

b) The Assistant Secretary of the Army (Acquisition, Logistics and

Technology), approved J&A, CMO Control Number 2015-061 on 2 June 2015. The J&A was approved utilizing FAR 6.302-1(a)(2)(ii)(A), “Substantial duplication of cost to the Government that is not expected to be recovered through competition” and FAR 6.302- 1(a)(2)(ii)(B), “Unacceptable delays in fulfilling the agency’s requirements.” This J&A supported additional FY 2015 requirements.

5) The Government awarded W56HZV-09-D-0159 on 26 August 2009 under a full and open competition utilizing a TDP that the Government possessed with unlimited rights.

6) The Government awarded W56HZV-08-C-0460 on 30 May 2008 as a sole source bridge contract. The J&A supporting W56HZV-08-C-0460 was approved by the Assistant Secretary of the Army (Acquisition, Logistics and Technology), utilizing FAR 6.302-1(b), “Only one responsible source(s) and no other supplies or services will satisfy agency requirements.”

7) The Government previously awarded FMTV requirements using full and open competition utilizing a TDP which the Government had unlimited rights in its use.

FMTV was identified to transition to sustainment in FY 2015, therefore there were no plans to award a follow on contract. However, in FY 2014 funding was realized to support Data Interchange customer requirements and modernization. Preparations began for a FY 2016 competitive contract. With the added funding, however, came the opportunity to fix some of FMTV’s survivability protection and electrical power requirements issues. In FY 2015, PM MTV began investigating upgrading the current A1P2 design. This resulted in the delay of the FY 2016 competitive contract to FY 2017. In FY 2016, PM MTV received ASARC approval to upgrade the FMTV in the FY 2017 competitive contract. Because of the ASARC approval, the upgraded FMTV (A2) is going to be competed in FY 2017. This contract action will limit sources and close out production of the A1P2.

8) Previous J&As have included duplication of cost as a reason for citing FAR

6.302-1 as the authority permitting other than full and open competition. This J&A does not rely on duplication of cost as a reason for authority cited because it is not a major deciding factor for this action. The duplication of cost through competition is estimated to be $39M. Based on historical data and extensive experience with competitive and sole source actions on similar systems, an ACC-DTA Contract Price/Cost Analyst estimated a 6% cost savings, or approximately $2.99M, by competing this action.

b.) Other facts: N/A

11/12. Technical/Requirements Certification: I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

NAME: Wolfgang Petermann

TITLE: Project Manager Transportation Systems

SIGNATURE:

DATE: ___11 Feb 2020_____________

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost or price to the Government for this contract action will be fair and reasonable. The Government will conduct a review to ensure that all awarded pricing is fair and reasonable in accordance with FAR Part 15. The Government will obtain Certified Cost or Pricing Data.

NAME: Brendon M. Courtade

TITLE: Contracting Officer

DATE: ___11 Feb 2020__

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

NAME: Brendon M. Courtade

TITLE: Contracting Officer

DATE: ___11 Feb 2020__

//S// Wolfgang A. Petermann

//s//Brendon M. Courtade

//s//Brendon M. Courtade