JA_SPRDL119R0102_Redacted.pdf

J&A SPRDL1-19-R-0102

(Previous J&A SPRDL1-12-R-0295 is available.)

Go in JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

SPRDL1-19-R-0102

1. Contracting Activity: DLA Land, Warren, is the responsible contracting activity for this action.

2. Description of Action: The proposed action is to secure a 5 Year Indefinite Delivery Indefinite Quantity (IDIQ) contract for the manufacturing of new “TURBOSUPERCHARGER, DIESEL ENGINE” commonly referred to as a Turbocharger. Competition will be limited to Borg-Warner (cage code 4W602) and authorized distributors. The type of funds to be used are Army Working Capital Fund (C-AWCF).

3. Description of Supplies/Services: This award is for the procurement of new, turbochargers for use in the M88A1 Recovery Vehicle System utilizing the AVDS-1790-2DR engine. The engine utilizes dual turbo superchargers in a parallel configuration. Turbochargers are mounted on the left and right rear of the engine. Exhaust gases pass from the cylinder head exhaust manifold through the turbine side of the compressor and out the vehicle exhaust system. This exhaust flow drives the compressor wheel via the rotor shaft. Air is drawn into the turbocharger through the air filter and into the compressor cover, it flows to the engine intake at an increased pressure via the pumping done by the compressor wheel. The dense air allows for additional fuel to be added to the combustion cycle resulting in increased engine power output.

For this contract, the deliverables are as follows:

a. NOUN: TURBOSUPERCHARGER, DIESEL ENGINE (A.K.A. Turbocharger)

b. NSN: 2950-01-167-1700

c. Top Drawing Number: 12275893-1

d. Manufacturer’s P/N: 187727

e. Min Quantity: 4

f. Max Quantity: 313

g. Estimated Unit Price:

h. Estimated Min Value:

i. Estimated Max Value:

j. PRON: EH81L421EH

Acquisition Method Code (AMC): 3. Acquire, for the second or subsequent time, directly from the actual manufacturer.

Acquisition Method Suffix Code: (AMSC): B. This part must be acquired from a manufacturing source(s) specified on a source control or selected item drawing as defined by the current version of DoD-STD-100. Suitable technical data, Government data rights, or manufacturing knowledge are not available to permit acquisition from other sources, nor qualification testing of another part, nor use of a second source part in the intended application.

Although, by DoD-STD-100 definition, altered and selected items shall have an adequate technical data package, data review discloses that required data or data rights are not in Government possession and cannot be economically obtained. If one source is available, AMCs 3, 4, or 5 are valid. If at least two sources exist, AMCs 1 or 2 are valid.

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 M88A1 is a recovery vehicle whose primary role is to extricate combat/tactical vehicles that have been damaged, stuck, overturned, or inoperable, as well as the vehicle’s crew. Recovery missions can take place during training exercises or while under fire in a combat zone. The M88A1’s 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 M88A1. The AVDS-1790 2-SERIES Engine is the heart of the M88A1 Recovery Vehicle Platform and makes recovery operations possible. The turbochargers are an integral part of the AVDS-1790-2DR engine used in the M88A1. A turbocharger operates at extremely high RPMs (60,000-270,000 depending on size) to create positive intake pressure. Due to this, the turbocharger is an intricate piece with precision tolerances and balancing to ensure it does not break due to high RPM and resonance.

Being that a turbocharger operates as part of the vehicle induction system, a failed turbocharger has the potential to cause catastrophic damage to the engine as broken parts have the potential to be sucked into the engines internals rendering it inoperable.

Only Borg Warner as the turbocharger OEM has the performance, technical and manufacturing knowledge to provide the turbocharger suited for the AVDS-1790-2DR engine. The Government does not own the data to assemble a complete Technical Data Package (TDP) and the above source is the only qualified supplier based on past history. The existing engineering drawing available for the turbocharger does not provide full build-to-spec data. As such, to develop a TDP to seek competitive bids would require reverse engineering. A prohibitive amount of time and money would be necessary to reverse engineer, procure and test prototypes, and release the design. The estimated cost to develop a competitive package for this item through reverse engineering could run as high as $3.0M and could require an estimated delay of at least 18 months to include fabrication and testing of the prototype hardware and releasing a validated TDP. Due to the aforementioned criticality of the turbocharger, design validation and qualification is required to become an approved source. Qualification would require RAM test of 5,000 miles to verify there are not unforeseen issues with the new part, full load cooling test and a cold test due to the potential impact it could have on the engine being such an integral piece.

Qualification could be obtained at an estimated cost of an additional $3.4M and a delay of more than 24 months. As such, there are currently no plans to qualify additional sources due to lack of funding that would be required to do so.

The Government would not be able to recover, through subsequent competition, the additional costs involved in reverse engineering the item to create a new and competitive turbocharger package. At the current average usage rate of 65 units each year (per the Item Manager), a current unit cost of , and assuming 25% savings achieved through additional competition, the in annual savings would take 95 years to offset the estimated $6.4M cost of reverse engineering the item and qualifying another source.

6. Efforts to Obtain Competition:

a. Effective Competition: Based on the detailed rational provided in Section 5 above, the Government has no plans to obtain additional competition for this proposed contractual action.

Since Borg Warner does not typically sell direct, the part could also be available from multiple distributors which opens up competition amongst vendors. Additional approved vendors will result in minimal additional cost savings in comparison to the additional cost required to qualify additional sources.

b. Subcontracting Competition: FAR clause 52.244-5, Competition in Subcontracting, will be included in the contract to assure that the prime contractor obtains as much competition as possible in its subcontracting.

7. Actions to Increase Competition: As stated in Section 5 above, a complete TDP is unavailable to support a competitive procurement. A TDP and the manufacturability details in theory could be developed, however, due to the costs associated with developing a competitive TDP and methodology that cannot be recovered also stated in Section 5, the US Government is not actively pursuing the development of a competitive TDP for future procurements. The US Government would not be able to recover the $6.4M to reverse engineer and qualify the turbocharger within a justifiable time frame.

This item does not appear on the Advance Procurement Planning List (APPL) dated 31 August 2018 but does appear on Competition Advocate Shopping List (CASL) dated 31 August 2018.

The CASL contains TACOM-Warren’s projected buy list of sole source items for the next three years. It is updated and advertised twice a year in the Fed Biz Opps and is available to interested contractors on the TACOM-Warren Business Opportunities website under the Future and Potential Buys link. 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 07 December 2018 by reviewing vendor catalogs and available product literature published by Garrett and Turbo International to determine if commercial items or non-developmental items are available to directly interchange with this turbocharger. While these sources have the ability to manufacture turbochargers that could theoretically be used as solutions in the M88 AVDS- 1790-2DR diesel, they do not currently have direct replacements for the engine. Since none of these sources have produced this specific item for the M88A1, they have not completed the necessary testing to become a qualified source as described in Section 5. The turbocharger manufacturer Borg-Warner (cage code 4W602) has been confirmed as the current source of this NSN on 04 December 2018. Borg-Warner has also stated that the turbocharger will need to be purchased through a distributor. Borg-Warner has multiple distributors that can supply the part.

The J&A does not include distributors because they are not the manufacturer or engine OEM.

The original manufacturer of the turbocharger was Schwitzer Engine Components (cage code 53591). Borg-Warner (cage code 4W602) acquired Schwitzer Engine Components in 1999 and became the producer of NSN 2950-01-167-1700. After acquiring the company, Borg-Warner moved production from the Schwitzer facility in Indiana to Ashville, North Carolina. Borg- Warner has stated that their part number 187727 is the exact same as that which was supplied by Schwitzer under the same part number for NSN 2950-01-167-1700. This part number is confirmed as available for procurement on 04 December 2018. Upon reaching out to Borg- Warner it was discovered that they do not sell direct and instead sell parts through vendor channels. While this item has been previously purchased from Southeast Power Systems and Octal Corporation these are distributors and are not qualified as new manufacturing sources.

Sources Sought Notice has been submitted to Fed Biz Opps on Aug 24, 2018 Component: TURBO SUPERCHARGER, ENGINE, NON-AIRCRAFT

NSN: 2950-01-167-1700

Part Number: 187727 End Item: M88A1, AVLB

Fed Biz Opps Link:

https://www.fbo.gov/?s=opportunity&mode=form&id=10ea2b3a6956d6d7222009d5ca3baf4b&t ab=core& cview=0

Market Research links:

1. https://www.turbobygarrett.com/

2. https://turbointernational.com/

9. Interested Sources: To date, no other sources have written to express an interest in qualifying as a source of supply. Sources Sought Notice 2018-706 was posted to Fed Biz Opps on 24 August 2018 for the Turbosupercharger, Engine, Non-Aircraft NSN 2950-01-167-1700, Part Number 187727 as required by FAR 5.201. Any responses received will be evaluated by the appropriate office.

10. Other Facts: Discuss any other facts supporting the use of other than full and open competition, such as the following:

a. Procurement history:

Contract: SPRDL113D0018

Award Date: 5/23/2013

Contractor: Southeast Power Systems of Orlando, Inc. (Cage: 3L018)

Value: $3,847,646.42

Competitive Status: Limited Source

Authority Cited: FAR 6.302-1, Only One Responsible Source

Note: No significant changes were made to prior J&A.

J&A_SPRDL112R029

5.pdf

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.

The POC for this action is g

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.