Stryker Class JA Redacted.pdf

CMO Control Number: 2023-088

CUI

JUSTIFICATION REVIEW DOCUMENT

FOR OTHER THAN FULL AND OPEN COMPETITION

Program/Equipment: Program Executive Office-Ground Combat Systems (PEO-GCS) Stryker Family of Vehicles (FoV) Fiscal Year (FY) 2024-2029 Logistics Support (LS) Wholesale Supply, and FY 2024-2028 Retrofit, Weld Readiness Repair Program (WRRP) and Reset/Refurbishment Services, and System Technical Support (STS) Requirements.

Authority: 10 United States Code (U.S.C.) 3204(a)(1) as implemented by Federal Acquisition Regulation (FAR) 6.302-1(a)(2)(iii)(A) and (B)

Amount: $5.308B

Prepared by:

Contracting Officer:

Technical Representative:

Program Manager (PM, for PM-managed items)

Clifton J. Boyd Project Manager

Requirements Representative:

Program Manager (PM, for PM-managed items)

Clifton J. Boyd Project Manager

DEPARTMENT OF THE ARMY

CLASS JUSTIFICATION AND APPROVAL FOR OTHER

THAN FULL AND OPEN COMPETITION

1. Contracting Activity: Army Contracting Command-Detroit Arsenal (ACC-DTA), Detroit Arsenal, MI 48397 is the contracting activity.

2. Description of Action: This Class Justification and Approval (J&A) requests approval to award three new long-term contracts to General Dynamics Land Systems (GDLS) in Sterling Heights, MI in support of the Stryker Family of Vehicles (FoV). The following contracts will be established to execute the Stryker requirements described herein:

a. Logistical Support (LS) Wholesale Supply. A new six-year requirements contract will be established to acquire LS Wholesale Supply services. The contract will primarily be funded using Army Working Capital Funds (AWCF) and will be a Performance Based Logistics (PBL) contract issued on a Cost- Plus-Incentive-Fee (CPIF) basis. A CPIF contract type is appropriate because it balances the strong incentive to control costs without allowing for decreased performance. In addition to the CPIF arrangement, the action will also incorporate an annual adjustment and CPIF model which provides a mechanism to adjust the target cost based on the most current vehicle densities and material credits for parts capitalized to AWCF. Requirements supporting Infantry Carrier Vehicle-Dragoon (ICV-D) will be funded with Operations and Maintenance, Army (OMA) funds and Obsolescence Management will be funded using Weapons and Tracked Combat Vehicles (WTCV) funds. Task orders will be issued to execute the PBL, which will include supply related performance metrics that are tied to incentive arrangements.

All other contract requirements will be ordered on a Cost-Plus-Fixed-Fee (CPFF) basis to include Authorized Stockage List (ASL) and Pipeline Spares funded with WTCV appropriations; Long Life Reusable Containers (LLRC) funded with Procurement, Army (PA) appropriations; and Depot Program Material and Forward Repair Distribution Center (FRDC) funded with OMA appropriations.

b. Retrofit, Weld Readiness and Repair (WRRP), and Reset/Refurbishment

Services. A new five-year requirements contract will be established to acquire retrofit, WRRP, and reset/refurbishment services. A CPFF contract type is appropriate under this contract as the Project Management Office Stryker Brigade Combat Team (PM-SBCT) does not have definitive requirements to sufficiently allow for Firm-Fixed-Price (FFP) orders. Multiple uncertainties exist with these requirements including locations, level of repair, required labor,

4. Authority Cited: The statutory authority permitting Other Than Full and Open Competition for this effort is 10 U.S.C. 3204(a)(1) as implemented by FAR 6.302-1(a)(2) which states, “When supplies or services required by the agency are available from only one responsible source, or, for DoD, NASA, and the Coast Guard, from only one or a limited number of responsible sources, and no other type of supplies or services will satisfy agency requirements, full and open competition need not be provided for.”

Specifically, FAR 6.302-1(a)(2)(iii) states, “For DoD, NASA, and the Coast Guard, services may be deemed to be available only from the original source in the case of follow-on contracts for the continued provision of highly specialized services when it is likely that award to any other source would result in – (A) Substantial duplication of cost to the Government that is not expected to be recovered through competition; or (B) Unacceptable delays in fulfilling the agency’s requirements.”

5. Reason for Authority Cited: The initial acquisition strategy, for what is known as the Stryker FoV today, did not include a provision to acquire the TDP. The Stryker FoV TDP is defined as a TDP for the baseline Infantry Carrier Vehicle (ICV) and 26 individual vehicle variant TDPs. Each vehicle variant TDP is based upon the ICV and includes a significant number of common parts, specific functionality, and technical complexities. The Stryker FoV TDP in sufficient detail for competative procurement of the Stryker FoV would be required to compete each of the contract actions.

The Government has taken delivery of some, but not all, of the Stryker FoV TDP.

GDLS is currently under contract to deliver additional portions of the Stryker FoV TDP.

However, even including those additional portions, the Government still will not have a complete Stryker FoV TDP sufficient for competitive procurement of any of the actions.

For example, GDLS is not slated to deliver detailed technical data for certain key components of the Stryker FoV.

In the portions of the Stryker FoV TDP that have been previously delivered, the Government has a mixture of associated license rights. For the many legacy components developed exclusively at GDLS’s expense, the Government has only limited rights in that technical data. For some components that were developed with Government funding, the Government has better rights. Similarly, in the still-to-be-delivered portions of the Stryker FoV TDP, the Government is also expecting limited rights in various technical data. Limited rights are insufficient for competitive procurement.

In addition to the TDP, the Government does not have the necessary computer software package (CSP), nor the intellectual property (IP) data rights for the CSP sufficient for competition, to the Stryker FoV.

Additionally, all attempts to obtain the necessary intellectual property to compete these services have been denied by GDLS. The Government issued a letter to GDLS on 31 May 2023 to procure a specifically negotiated license that would allow the Government to compete each of these services. GDLS declined the Government’s request on 6 June 2023.

As a result, the Government does not possess the pertinent technical data and computer software, nor the necessary intellectual property data rights, to enable a competitive procurement of any of the actions, as explained further below. If the Government were to pursue a competitive acquisition for these services to support the Stryker FOV, it would result in a unacceptable delay and duplication of cost resulting in reduced warfighter readiness.

The following paragraphs provide further support for the need for the Stryker FoV TDP and CSP to compete each group of services.

a. LS Wholesale Supply: Since the Government does not have the Stryker FoV TDP, GDLS has maintained control of configuration management and sustaining engineering functions for all Stryker variants. The Stryker FoV TDP undergoes frequent Engineering Change Proposals (ECPs) to vehicle configurations that also require engineering work to update the components, higher-level assemblies, and vehicle technical data to ensure the most up-date parts and assemblies are incorporated into Stryker vehicles. Therefore, the LS Wholesale Supply requirement cannot be competed unless the Government obtains the Stryker FoV TDP to implement processes to manage the configuration control functions to organically sustain the engineering and configuration changes. Additionally, for another contractor to perform this work, the Government would need data rights for and have access to the complete product definition data to include TDPs, detailed specifications, models, and computer software for all product level vehicle configurations to ensure ECPs and drawing changes for specific parts are accounted for and tracked.

b. Retrofit, WRRP, and Reset/Refurbishment Services: The Stryker FoV TDP is required to support retrofit, WRRP, reset/refurbishment services. These services involve changing, upgrading, or repairing the Stryker vehicle to the latest configuration and applying mission unique hardware and software in order to prepare the vehicles for deployments. While Government personnel have the capability to perform portions of the repairs in accordance with Interactive Electronic Technical Manuals (IETM), technical assistance and guidance from GDLS is required when troubleshooting issues related to repair procedures, welding specifications, diagnosing failures, and for issues with parts and material compatibility. In addition, certain retrofit and repair tasks also require a welding aspect to be completed. The Government

The Government estimates the total cost for a contractor other than GDLS to perform the requirements of the LS Wholesale Supply, Retrofit, WRRP, and Reset/Refurbishment Services, and STS contracts to be $1.47B. This cost encompasses TDP and Log Product development, Prototype Build, and Testing. If the Government were to compete this requirement, it is highly unlikely that the Government would achieve a cost savings through competition.

6. Efforts to Obtain Competition:

a. Effective Competition: The Government intends to solicit only GDLS for these acquisitions based on the rationale provided in Section 5 above. The Government will post all notices required by FAR 5.201, Pulicizing Contract Actions, and any responses received from responsible sources will be considered.

b. Subcontracting Competition: To ensure the contractor competitively awards subcontracts to the maximum extent possible, these contracts will contain FAR Clauses 52.244-5 "Competition in Subcontracting," 52.244-2 "Subcontracts," and 52.219-8 "Utilization of Small Business Concerns."

GDLS, as a large business, will also be required to submit a subcontracting plan for review and approval in accordance with FAR 52.219-9 "Small Business Subcontracting Plan."

7. Actions to Increase Competition: The Government will continue to make attempts to acquire technical data, computer software, and data rights sufficient for competition from GDLS; however, it does not plan to pursue a specific reverse engineering at this time based on the rationale provided in paragraph 5. The Government frequently sends letters to GDLS requesting specifically negotiated license rights for the Stryker FoV.

The Government will continue to acquire and take delivery of Level III drawings and software resulting from performance under the STS contract for select Stryker unique items and vehicle kits. The Government is continuously conducting market research to provide for future competition and will continue to emphasize the Agency small business subcontracting goals.

8. Market Research: PM-SBCT continuously conducts market research in accordance with FAR 10.002(b)(2) to determine whether other capabilities of industry can be used to fulfill its life cycle requirements and to ensure its acquisition methods obtain the best value for the Government. The following actions are examples of how PM-SBCT acquired market information in preparation for this acquisition:

a. ACC-DTA and PM-SBCT issued separate Requests for Information (RFI) for LS Wholesale Supply, Retrofit, WRRP and Reset/Refurbishment Services and STS between September 2022 and June 2023. The RFls were issued to assess industry capabilities and readiness of potential qualified contractors and to determine if commercial equivalents for the requirements discussed in this justification exist. A summary of the responses are below:

i. The RFI for the LS Wholesale Supply contract was published to

SAM.gov on 30 September 2022 through 07 October 2022. No responses were received for this RFI.

The RFI for retrofit services was posted on SAM.gov between the dates of 07 October 2022 and 28 October 2022. The RFI resulted in a single response from Yulista Integrated Solutions, LLC. Upon review of the RFI response, PM-SBCT determined the vendor would not be suitable to perform the requirement. The vendor stated a stable or “red line” TDP would be required, in which PM-SBCT does not have available due to GDLS owning the proprietary information.

The RFI for refurbishment was posted on SAM.gov between 24 May 2023 and 08 June 2023. The RFI resulted in two responses from UNICOR and RV Global Solutions Inc. Upon review of the UNICOR RFI response, PM-SBCT determined that the vendor only submitted a response on portions of the refurbishment services and not the full-service requirement. Due to the vendor’s inability to complete the entire requirement, UNICOR was deemed unqualified. Upon review of the RV Global Solutions Inc. RFI response, PM-SBCT determined the vendor did not understand the requirement, as the vendor provides services related to IT, management consulting solutions, infrastructure, and engineering logistics. RV Global Solutions Inc. was deemed unqualified.

ii. The RFI for welding repair services was posted on SAM.gov between the dates of 06 June 2023 and 13 June 2023. No responses were received.

iii. The RFI for STS services was published to SAM.gov on 25 May 2023 to 7 June 2023 for a period of 10 days. GDLS responded stating it can perform these services as they have successfully been performing these services under current and past contracts with the Government.

b. In addition, the Government coordinated with other Government resources such as ANAD as possible alternatives for the Retrofit, WRRP, and Reset/Refurbishment requirements discussed in this justification. The Retrofit, WRRP, and Reset/Refurbishment efforts all require intensive GDLS technical support since the vehicles are repaired to a GDLS-owned Stryker FoV TDP.

previous justification was non-competitive in nature.

b. Other facts. GDLS was competitively selected for the vehicle production contract utilizing best value Source Selection techniques in November 2000. The initial PM-SBCT requirement can be found in the Interim Armored Vehicle (now Stryker) Operational Requirements Document dated 6 April 2000. While an integrated Analysis of Alternatives was not developed for the initial Stryker FoV acquisition, several analyses were conducted to develop and refine the PM- SBCT Organizational and Operational Concept that was to establish Stryker operational requirements and compare alternatives to meeting those requirements. Because the TDP was not licensed when this contract was awarded, the follow-on actions to procure services for the sustainment of the Stryker FoV were awarded to GDLS pursuant to approved J&As.