ACC1906.pdf

CMO Control Number: 2014-087

MMPV Panther STS

W56HZV-14-R-0046

DEPARTMENT OF THE ARMY

JUSTIFICATION AND APPROVAL FOR OTHER THAN

FULL AND OPEN COMPETITION

1. Contracting Agency: Army Contracting Command – Warren (ACC-WRN)

2. Description of Action: This action will result in a sole source award to BAE

Systems Land & Armaments L.P. (BAE) to provide hardware and one year of System Technical Support (STS) services, with an option for an additional one year of service, in Support of Contract W56HZV-08-D-0041 for the Panther Medium Mine Protected Vehicle (MMPV). The period of performance may also be extended by an additional six months in accordance with FAR 52.217-8: Option to Extend Services. The STS services provided will be in response to field problems to include visits to Government Continental United States (CONUS) and Outside the Continental United States (OCONUS) operational facilities or Contractors, sub-Contractors, or supply chain partners. The contract will be awarded on a Cost Plus Fixed Fee (CPFF) basis with FY12 and FY14 Other Procurement Appropriations (OPA). The contract performance period for this severable service effort, funded with FY12 funds will end 30 September 2014.

3. Description of Services: The purpose of this acquisition is to provide engineering, logistics, field service representative (FSR) support, and hardware for the Panther MMPV systems. The proposed effort will cover the following STS Services:

a. Engineering Support

b. Cold Weather Kits

c. Long Life Reusable Containers

d. Configuration Management

e. Technical Manual Revision Services

f. Production Support

g. Integrated Logistics Support

h. Engineering Service Representatives

i. Field Support Representatives

The estimated total contract value for the base year plus option year is $3,631,584.

This amount includes an estimated 27,450 hours per year with a total estimated labor cost of $2,611,808; this is comprised of labor hours for on-call support consisting of email and telephone correspondence for personnel located at BAE Systems in Sterling Heights, Michigan, to include Program and Engineering Support, Engineering Service Representative and Field Service Representatives. Also included is an estimated amount of $700,000, for material, shipping, etc costs and $319,776 for other direct costs (ODC) and travel.

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4. Authority Cited: The statutory authority permitting Other Than Full and Open

Competition for this action is 10 USC 2304 (c) (1), FAR 6.302-1 (a) (2) (iii) (A) (B), “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.” Specifically, FAR 6.302-1 (a) (2) (iii) (A) (B) states that services may be deemed to be available only from the original source when in follow on contracts competition would result in (A) substantial duplication of cost that would not be recovered through competition or (B) unacceptable delay in fulfilling the government’s requirements.

5. Reason for Authority Cited: Award of this action on a sole-source basis to BAE

Systems to provide System Technical Support (STS) services is justified because BAE Systems owns the technical data; as they are the Original Equipment Manufacturer (OEM) and initial developer of the Panther MMPV system. Through performance on contract W56HZV-08-D-0041, BAE Systems has developed and maintains the only existing collection of technical information on the Panther MMPV systems, including technical analyses, trade-off studies and problem investigation reports. BAE Systems owns the proprietary rights to the MMPV Technical Data Package (TDP), and also maintains responsibility for overall configuration control of the vehicles. Award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and unacceptable delays in fulfilling the agency’s requirements.

a. Unacceptable Delay – Fielding of the Panther MMPV vehicles is scheduled in August 2014. Award of this STS contract beyond the target award date in June 2014, would create unacceptable program delays. Prior to fielding, the Panther MMPV vehicles require: updated capabilities through vehicle engineering changes;

development of Cold Weather Kits that are necessary before the PM can field to Alaska and Ft Drum units; engineering services to Letterkenny Army Depot (LEAD) for the Panther MMPV Recapitalization program; and Field Service Representatives (FSRs) to support the fielding activities beginning in August 2014.

(1) BAE Systems is the only source with the engineering expertise required for the complex vehicle engineering tasks associated with the Panther MMPV system.

BAE Systems is the only contractor that understands the current vehicle engineering needs in relationship to past configurations and future vehicle upgrades to integrate Engineering Change Proposals (ECPs). The engineering staff at BAE Systems uniquely possess the requisite technical knowledge to timely and accurately respond to issues on the mechanical and electrical system and those associated with the total system integration.

(2) Due to the complexity of the Panther MMPV vehicle it would take a new source approximately 24 months before they could begin to perform any of the STS tasks. The 24 months would include: vehicle teardown, documentation and parts identification and 6 months for FSR training. This estimate is based on historical

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Comment [Y7]: OPSEC carlo.a.daleo Highlight carlo.a.daleo Highlight experience of other wheeled vehicle systems (Medium and Heavy Tactical Vehicles) programs where the STS tasks are broken out and awarded to organizations other than the OEM. This timeframe would be unacceptable for the Army to recapitalize and reset the Panther MMPV systems for soldiers to use both CONUS and OCONUS. The inability to operate these vehicles would put soldier’s lives at risk.

b. Duplication of Cost – Based on analysis, the Government has determined that there would be no savings by pursuing a competitive award for this effort. If this services contract was awarded to another source, the total duplication of costs would be $12M to $17M. It is not anticipated that these costs would be recovered through competition given that this is a one-time requirement and no future similar acquisitions are anticipated.

(1) BAE Systems owns the Panther MMPV TDP, and stated in a letter dated 29

June 2010 that it would not sell rights to the Government. Therefore, the Government or another contractor would have no means to develop the technical data without substantially duplicating costs. Based on other Government production contracts for similar wheeled vehicle systems (Medium and Heavy Tactical Vehicles) awarded to independent contractors has taken approximately two years at an estimated cost of $10M to $15M to reverse engineer the technical data needed. The process of reverse engineering would consist of producing blue prints for each system assemblies, components, parts with dimension and specifications outlined on each drawing.

Blueprints would have to be verified in the Production Configuration Audit (PCA) to ensure that assemblies, components, and parts will be able to be assembled into the desired configuration. Development cost would include tearing the vehicle completely down; cataloging all parts; and producing level three drawing for all parts; there are approximately 6,500 line items of parts on the Panther.

(2) In addition to development cost, there would be an additional cost of $2M for training FSR personnel. The FSRs would be used to provide technical support to the Total Fielding Package (TFP) teams during de-processing at the fielding locations. This estimate is based on historical costs for contractor field service on other Army systems similar to the MMPV (i.e., Medium and Heavy Tactical Vehicles).

6. Efforts to Obtain Competition: BAE Systems was awarded a competitive contract to produce the Panther MMPV systems and as the OEM, only BAE Systems can provide the STS support for the Panther MMPV. To date, no other vendor has indicated interest in writing. This effort will be synopsized in FedBizOpps.gov to maximize subcontracting opportunities as required by FAR 5.201. It is intended to solicit only BAE Systems for this acquisition. No other attempt to seek other sources will be made for the reasons stated in paragraph 5 above. All responsible sources may submit a capability statement, proposal or quotation which shall be considered by the agency.

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7. Actions to Increase Competition: This is a one-time requirement and no future similar acquisitions are anticipated. This is a sole source vehicle with no technical data available commercially. There is no way to increase competition within industry without substantial duplication of cost to the Government. Therefore, no actions to increase competition have been taken at this time.

8. Market Research: The Product Manager Assured Mobility Systems (PdM AMS)

Program Office conducted market research IAW FAR 10.002(b)(2) for the Panther

MMPV.

a. Research included reviewing catalogs and product literature of similar items available by other manufacturers in 2013. PdM AMS personnel also attended trade shows but were limited to the Michigan Defense Industrial Base Exposition and Society of Automotive Engineers due to government imposed travel restrictions. In addition searches were performed via https://www.contractdirectory.gov/contractdirectory from January to August of 2013. The results have not revealed other sources with the technical expertise required for this procurement.

b. Further, PdM AMS Panther personnel conduct on-going market research, as late as September 2013, that includes reviewing on-line magazines consisting of Army Technology, Army Magazine, Soldiers Magazine, Army Times, and Army AL&T, and various marketing publications from vehicle manufacturers providing information of their product line and their vehicle capabilities. This research has not identified other sources of supply for this effort.

c. Along with the aforementioned research, PdM AMS’ expertise with similar contracting efforts (logistic contract efforts of the RG-31, Buffalo, and other AMS platforms) and engineering knowledge of the Panther, it was determined that no other contractor besides the OEM has demonstrated the unique knowledge and experience that could provide the necessary engineering, logistics and Field Service Representative expertise. PdM AMS continues to actively seek out and determine if other contractors are readily available and can immediately meet mission requirements.

9. Interested Sources: To date, no other vendors have indicated interest in writing.

This effort will be synopsized via FedBizOpps.gov to maximize subcontracting opportunities as required by FAR 5.201. All responsible sources may submit a capability statement, proposal, or quotation which shall be considered by the agency.

10. Other Factors:

a. Procurement History: BAE Systems was awarded contract W56HZV-08-D-0041 on 19 December 2007 for production of Panther MMPV systems. This was a https://www.contractdirectory.gov/contractdirectory competitive contracting action.

b. Acquisition Data Availability: Technical Data Packages and engineering descriptions suitable for full and open competition are not available to support the services required herein. BAE Systems is the only contractor with the knowledge and experience of design and performance and is the only practical source that can provide the technical knowledge needed for this requirement

c. Unusual and compelling urgency: N/A

d. Subcontracting Competition: To encourage competition at the subcontractor level, the contract will contain the following subcontracting clauses: FAR 52.244-2, “Subcontracts,” and FAR 52.244-5, “Competition in Subcontracting.”

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.”

NAME: Jeffrey J. Kubik SIGNATURE:

TITLE: Assistant Product Manager, Date: Tuesday, 18 March, 2014 Assured Mobility Systems

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.”

NAME: Jeffrey J. Kubik SIGNATURE:

TITLE: Assistant Product Manager, Date: Tuesday, 18 March, 2014 Assured Mobility Systems

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 based on the results of a detailed cost and price analysis by the Army Contracting Center, Warren, MI and the contractor’s submission of certified cost or pricing information as necessary.

NAME: Yvette C. Thompson SIGNATURE:

TITLE: Contracting Officer Date: Tuesday, 18 March, 2014

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

NAME: Yvette C. Thompson SIGNATURE:

TITLE: Contracting Officer Date: Tuesday, 18 March, 2014

APPROVAL

Based on the foregoing justification, I approve the procurement to acquire hardware and one year of System Technical Support (STS) services, in support of the BAE Systems Medium Mine Protected Vehicle (MMPV) Panther systems, on an other than full and open competition. This approval is made pursuant to the authority of 10 USC 2304 (c)(1) as implemented by FAR 6.302-1(a)(2)(ii)(A)(B) at a total estimated amount of $3,631,584. This approval is subject to the availability of funds, and provided that the services and property herein described have otherwise been authorized for acquisition.

Date: _19 Mar 2014_______ SIGNATURE: _//signed//_______________________

LA RUTH SHEPHERD

Competition Advocate

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