JA_Air_Conditioner_Kit_Redacted.pdf

DEFENSE LOGISTICS AGENCY J&A: SPRDL1-19-R-0146

(Previous J&A from Contract SPRDL1-17-C-0159 is available)

Defense Logistics Agency

Justification and Approval for Other than Full and Open Competition

1. Contracting Activity: The Defense Logistics Agency Land – Warren (DLA Land – Warren) is the responsible contracting activity for this action.

2. Description of Action: The proposed action is to award a new hardware contract on a sole source basis to Honeywell International Inc., Cage Code 70210, (formerly Allied Signal Aerospace) for the procurement of an air conditioner parts kit. The type of funds to be used are Army Working Capital Fund (AWCF). The type of contract is Firm Fixed Price.

3. Description of Supplies/Services: This award is for the procurement of new air conditioner part kits for the continued support of the Abrams vehicle. This component is part of the Abrams vehicle air conditioning heat exchanger to provide effective cooling of the air supplied to the Nuclear, Biological and Chemical (NBC) cabin air filtration system. The total estimated value for this contract is for up to 100 air conditioner parts kits. For this contract, the deliverables are as follows:

NOUN: PARTS KIT, AIR CONDITIONER

a. NSN: 4130-01-381-6907

b. P/N: 5705515

c. Quantity: 50

d. Option Quantity: 50

e. Estimated Unit Price: $

f. Estimated Value: $

g. Estimated Option Value:

h. Estimated Total Value:

i. PRON: EH9C0061EH

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

Acquisition Method Suffix Code: (AMSC): C This part requires engineering source approval by the design control activity in order to maintain the quality of the part. Existing unique design capability, engineering skills, and manufacturing knowledge by the qualified source(s) require acquisition of the part from the approved source(s). The approved source(s) retain data rights, manufacturing knowledge, or technical data that are not economically available to the Government, and the data or knowledge is essential to maintaining the quality of the part. An alternate source must qualify in accordance with the design control activity's procedures, as approved by the cognizant Government engineering activity. The qualification procedures must be approved by the Government engineering activity having jurisdiction over the part in the intended application.

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 main component of this repair kit (5705515) is the air cooler unit/heat exchanger (P/N 12336771) which is more than 50% of the cost of the kit. This heat exchanger is an integral part of the climate control/NBC system for the vehicle. Air that is bled off the turbine engine is cooled through the air cycle machine before passing through the Nuclear, Biological and Chemical (NBC) filter. This heat exchanger is a major component of the air cycle machine as it is the portion that does all the cooling. An improper or failed heat exchanger under battlefield conditions would cause a loss of temperature control to the crew and could cause overheating resulting in heat stress and inability to complete the mission. Further, it could potentially damage the vehicle’s NBC system. Because the heat exchanger is integrated into the overall system envelope there are not off the shelf components available that could work within the system.

The USG does not own the build to print Technical Data Package (TDP) for this item. While the USG owns a performance specification for the heat exchanger, it does not own the manufacturing data for it. Honeywell is the sole owner of their manufacturing technical data and the drawing is source controlled to them. Only the vendor “Honeywell International Inc.”

has the requisite technical and engineering expertise to perform all efforts required to provide the item identified in this J&A. The current supplier has qualified in accordance with all the necessary test requirements and performance parameters shown on the drawing SC12336771 (Critical Item Production Function Specification for Heat Exchanger P/N 12336771). The approved source identified above has demonstrated the ability to establish and maintain the processing required to produce this item. An award to any other source would cause a substantial duplication of costs to the Government not expected to be recovered through competition. The air temperature control valve is critical to both Abrams vehicle readiness and warfighter safety.

In order to be competitive, any other source of supply is still required to produce, test and receive Government approval of their proposed part prior to acquisition. There are also no current plans to acquire a competitive “build to print” TDP because funds are not available to acquire the data necessary to support a competitive acquisition. A significant amount of time and money would be necessary to reverse engineer, procure and test prototypes before releasing the design. This delay would severely impact the availability of the repair kit in the field and Anniston Army Depot's rebuild program. This kit is critical to Abrams vehicle readiness. Through previous experience, it can be estimated that the cost to develop a competitive package for the heat exchanger through reverse engineering could run as high as

$300K and could create an estimated delay in procurement of at least 12 months due to fabrication and testing of the prototype and releasing a validated TDP. Testing for basic shock, durability, humidity, temperature, endurance, sand and dust, and vibration are all standard testing requirements on a component of this type. This testing would take approximately 9 months at a cost of $200K. Qualification and durability testing at Yuma Proving Grounds would also be required. This type of testing requires an additional 12 month, 6,000 mile test utilizing 3 prototypes at an estimated cost of $300K each.

At the current average usage rate of 36 units per year (per the Item Manager), a current cost of , and assuming savings achieved through additional competition, the annual savings would take 33.5 years to offset the estimated to qualify another source. The Government would not be able to recover, through subsequent competition, the additional costs associated with reverse engineering the item to create a new and competitive heat exchanger.

6. Efforts to Obtain Competition:

a. Effective Competition: Per section 7, potential vendors can submit requests to become a source through the Source Approval Process at any time. Per section 9, a Sources Sought notice was posted. Based on the detailed rational provided in paragraph 5 above, the Government has no plans to obtain additional competition for this proposed contractual action. Approving additional vendors will result in minimal additional cost savings in comparison to the additional cost required to qualify those 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 and manufacturing knowledge are 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 Government is not actively pursuing the development of a competitive TDP for future procurements. The Government would not be able to recover the money to reverse engineer and qualify the item within a justifiable time frame.

Contractors interested in becoming a source of supply need to meet the requirements of the Source Approval Program including vehicle level qualification testing, at their own expense.

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, there has not been any expressed interest by any known vendor(s) to become qualified source(s) to produce this item.

8. Market Research: Market research was completed by TARDEC Engineering on 27 November 2018 by reviewing the available products and capabilities of vendors with expertise in the field of heat exchangers. Review of the following companies was performed: Toshiba, Griffin Radiators and Modine. Upon review it was determined that while the aforementioned vendors all have the capability to manufacture heat exchangers like P/N 12336771, they don’t have the exact component needed due to envelope constraints. New vendors would require extensive analysis, prototyping, and vehicle testing as described in section 5 above to ensure that the heat exchanger will properly integrate into the Abrams M1 and meet performance specifications. The cost of such analysis, prototyping and testing would far exceed any cost savings realized by adding another source. Further, the Government does not own build to print technical data to source an additional manufacturer without extensive development and qualification testing. TARDEC Engineering also contacted the current source controlled vendor, Honeywell International Inc. and verified they still produce the heat exchanger.

Sources Sought Synopsis posted to Fed Biz Opps on 11-15-2018 Component: Parts Kit, Air Conditioner

NSN: 4130-01-381-6907

Part Number: 5705515 End Item: Abrams M1

Sources Sought Notice 2019-088.pdf https://www.fbo.gov/notices/fc613378503d5b54c20270df7af12309

9. Interested Sources: To date, no other sources have written to express an interest in qualifying as a source of supply. Sources Sought Notice 2019-088 was posted to Fed Biz Opps for the Valve Repair Kit, NSN 4130-01-381-6907, Part Number 5705515 on 15 November 2018. Any responses received will be evaluated by the appropriate office.

10. Other Facts:

a. Procurement history: Contract SPRDL1-17-C-0159 was awarded 05 MAY 2017 for this same item. The previous J&A provided support for this item being restricted to Honeywell International (70210). Previous J&A is available.

https://www.fbo.gov/notices/fc613378503d5b54c20270df7af12309

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

Name:

Title:

Signature:

Date: 22 February 2019 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.

Typed Name:

Title:

Signature:

Date: 26 Feb 2019

Name:

Title:

Signature:

Date: 26 February 2019 Email:

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. Due to the estimated dollar value, certified cost and pricing data will be not be required in accordance with FAR 15.403. However, other than certified cost and pricing data may be required in order to establish price reasonableness

Typed Name: Morris Belleville Date: 03/06/2019 Title: Contracting Officer Signature: Morris A. Belleville /S/

4. Contracting Officer Certification:

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

Typed Name: Morris Belleville Date: 03/06/2019 Title: Contracting Officer Signature: Morris A. Belleville /S/

15. Legal Review:

Concur:

Date 03/11/2019