Redacted_J&A_Final-_Wheel_Assemblies.pdf

Control No. CAO-19-0345

FOR OFFICIAL USE ONLY

Justification and Approval for Other than Full and Open Competition

1. Contracting Activity: Army Contracting Command – New Jersey

2. Description of Action: Project Manager-Towed Artillery Systems (PM-TAS) requests award of a new Firm Fixed Price Indefinite Delivery, Indefinite Quantity contract. Fiscal Year 2019, Weapons and Tracked Combat Vehicles funds will be used for the minimum ordering quantity.

3. Description of Supplies/Services: The M777A2 Howitzer is a towed 155mm Howitzer that provides increased capability in mobility, survivability, deployability, and sustainability in any expeditionary environment throughout the world. This proposed contract action is to furnish Wheel Assemblies to the Government for the sustainment of M777A2 Howitzers held by both the Army and the Marine Corps. There are two configurations of the Wheel Assembly for the M777A2 Howitzer. The One-Piece Wheel Assembly is the Marine Corps Configuration. The Two-Piece Wheel Assembly is the Army Configuration of the M777A2 Howitzer and includes a run flat tire. The Two-Piece Wheel Assembly is necessary to allow M777A2 Howitzers to keep moving in spite of tire damage or punctures. Hutchinson Industries is the current manufacturer of both the One-Piece and Two-Piece Wheel Assembly for the M777A2 Howitzer Platform.

The period of performance will be five years from the date of award. The maximum quantity of Wheel Assemblies under this effort is 200 One-Piece Wheel Assemblies and 460 Two-Piece Wheel Assemblies. The total estimated value is

4. Authority Cited: Title 10 United States Code (U.S.C.) Section 2304(c)(1) as implemented by Federal Acquisition Regulation (FAR) 6.302-1(a)(2)(ii)(A), Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

5. Reason for Authority Cited:

As described at FAR 6.302-1(a)(2), when the supplies or services required by the agency are available only from 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 agencies requirements, full and open competition need not be provided for. As further stated in FAR 6.302-1(a)(2)(ii)(A), supplies may be deemed to be available only from the original source in the case of a follow-on contract 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 substantial duplication of cost to the Government that is not expected to be recovered through competition,. The proposed contractor is Hutchinson Industries, Inc., 460 Southard Street, Trenton, NJ, 08638.

Hutchinson’s wheel assemblies are used by the majority of U.S. wheeled fighting vehicles – including High Mobility Multipurpose Wheeled Vehicles and Strykers.

Hutchinson Industries has provided wheel assemblies, including its proprietary run-flat technology, to the Army for over 80 years. For the run-flat configuration wheel assemblies, extensive research has indicated that no other run-flat designed wheel exists to meet the M777A2 Howitzer application. The Two-Piece Wheel Assembly is necessary to allow M777A2 Howitzers to keep moving in spite of tire damage or punctures. Standard commercial run-flats have a connection that can break upon ballistic impact.

As detailed herein, Hutchinson Industries is the only entity with the necessary knowledge and experience to produce the required configurations. If other wheel assemblies were to be utilized, extensive retesting will be required to assess mobility characteristics, logistics and maintenance impacts, and ability to meet user requirements. In order to eliminate potential issues with availability of wheel assemblies, which could halt sustainment of M777A2 howitzers, it is imperative that Hutchinson Industries continue with a follow-on effort to supply the Wheel Assemblies to the Government.

A substantial duplication cost of would be incurred if this requirement was competed and awarded to another contractor. Hutchinson is the current developer, manufacturer, and producer of the Wheel Assemblies to support the M777A2 Howitzer.

As the developer and current producer of the M777A2 Wheel Assemblies, Hutchinson Industries owns proprietary rights to the design of the run-flat Two-Piece Wheel Assembly for the M777A2 application. Hutchinson Industries originally produced the wheel assemblies under Government Contract No. W15QKN-05-C-0608, and continued production of those units under Contract No. W15QKN-13-D-0056 to the present day. It is estimated that it would cost approximately for another contractor to gain the experience necessary to conduct qualification testing and produce a qualified wheel assembly that would meet the Government’s requirement. The duplication costs are estimated based upon an engineering estimate from prior program efforts to qualify wheel assemblies to be utilized on the M777A2 Howitzer Platform. The Government would incur substantial duplication costs over an estimated period of for the non-recurring engineering involving Functional Baseline Analysis, Baseline Design, Prototyping, Detail Design, Design Verification & Validation, and Systems Qualification.

The duplication costs are broken out by labor category and rate and listed below:

This duplication cost is not expected to be recovered through competition and, to date, the Government has been unable to locate an alternate supplier for these items. In addition, Hutchinson’s supply chain is currently in place and offers economies of scale based on other programs using similar equipment.

6. Efforts to Obtain Competition:

a) Effective Competition: Since it has been determined that his is a sole source action, effective competition is not applicable. The notices required by FAR 5.201 shall be posted and any bids or proposals received considered.

b) Subcontracting Competition: Subcontracting competition will be achieved by the prime contractor by publicizing subcontracting opportunities, as appropriate, in accordance with FAR 5.206. The contract will include FAR Clause 52.244-5 entitled “Competition in Subcontracting” and FAR 52.219-9 “Small Business Subcontracting Plan”.

7. Actions to Increase Competition: Full and open competition is not practical at this time. In-depth research in the field has demonstrated no other contractors capable to supply the M777A2 Howitzer wheel assemblies. The M777A2 Howitzer Wheel Assemblies being purchased from Hutchinson Industries are commercial items involving proprietary components. The Government contacted Hutchinson on 30 April 2019 and they have no interest in relinquishing its proprietary knowledge of the run-flat technology.

As part of sustainment activities for the M777A2 Howitzer, the Government will review the howitzer for continued supportability and obsolescence, which will include a review of wheel assembly technology.

8. Market Research:

In accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 205.205-71, DFARS 206.302-1(d), and DFARS Procedures, Guidance and Information (PGI) 206.302-1(d), a market survey, W15QKN-19-X-05NZ, was posted to FedBizOpps on 11 March 2019 and closed on 14 March 2019. No official responses of interest were received during this time.

During the last 12 months, from April 2018 to March 2019, members of the PM-TAS Business Office including the Business Manager have canvassed the industrial community, both domestic and foreign, in order to obtain the latest information concerning the availability of similar wheel assemblies that would meet the M777A2 Howitzer requirements for Army run-flat (Two-Piece) Wheel Assemblies. Results of meetings with contractors during the Association of the United States Army Industrial Symposium in March 2019, subsequent telephone conversations, and continuous literature searches, indicate that no similar items currently exist which would meet the M777A2 Howitzer requirements. Specific checks were also made with Accuride and Rodgard, as well as Michelin, Goodyear and Goodrich which resulted with all five contractors indicating they currently do not produce an item which would meet the M777A2 Howitzer requirements for the Army. As a result, it is recommended that this action be solicited as a sole source to Hutchinson Industries because of the substantial duplication cost and schedule delays outlined above.

9. Interested Sources: To date, no other sources have written to express interest in the requirement. If any other source submits interest on this requirement, their capabilities and bids/proposals will be considered.

10. Other Facts:

a. Procurement History

1) Contract number: W15QKN-13-D-0056

2) The competitive status of this action was: Other than Full and Open Competition

3) Authority Cited: FAR 6.302-1, Only One Responsible Source and No Other Supplies or

Services Will Satisfy Agency Requirements.

4) Paragraph 7 of the previous J&A stated that Full and Open Competition was not practical at the time. In-depth research in the field demonstrated that no other contractors were capable of suppling the M777A2 Howitzer wheel assemblies. As part of sustainment activities for the M777A2 Howitzer, the Government would review the howitzer for continued supportability and obsolescence, which would include a review of wheel assembly technology. The platform is continuously analyzed for obsolescence. Based on active wheel production for the India program, it is deemed that the wheel technology provided by Hutchison is not currently a risk for obsolescence.

PM-TAS has canvassed industry, both domestic and foreign and to date no other contractor can provide a viable alternative that would meet the M777A2 Howitzer requirements for Army two-piece wheel assemblies. As a result, full and open competition is not practical at this time.

5) All recent contract actions for this item have been were awarded based on Other than Full and Open Competition.

6) There are no unusual patterns

7) Significant Changes: There have been no significant changes since the previous procurement. Hutchinson is the only source that possesses the requisite level of expertise and experience to provide an M777A2 Howitzer Wheel Assembly that will meet the required delivery schedule without substantial duplication costs incurred.

b. Other facts: There are no other facts

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.

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.

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.

This determination will be made using cost analysis, price analysis, and a comparison to the Independent Government Estimate.

As part of this basis, certified cost or pricing data will not be required per FAR 15.403- 1(b)(3).

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