20220708_Distro-A-JLTV-FoV_RFP_QAs.pdf

DISTRIBUTION STATEMENT A: Approved for public release; distribution unlimited.

Solicitation W56HZV-20-R-0072, Questions & Answers

ID Subject/RFP Reference

Question Government Response

H.3.10

In Amendment 4, section H.3.10, the solicitation states " the maximum increase to any particular vehicle unit price shall be 10% of the original contract unit price for that vehicle."

Starting at the current index value and applying a year-over-year inflation rate of 4% or greater, the Economic Price Adjustment (EPA) exceeds the maximum and loses its effect during Option Year 1 (program year 6).

An offeror at Order Year 1 target price, who assumes 4% inflation or greater, would exceed the Government’s affordability limit before the conclusion of the option periods and therefore, the offeror’s proposal would fail to meet affordability requirements (M.3.2.1 Affordability) and would render an offeror ineligible for award.

Given the current economic conditions, would the government consider removing the 10% maximum price increase in order to: 1) ensure that inflation uncertainty does not limit competition by excluding offerors and 2) ensure the government receives the most competitive prices? This would be supported by instructions within DFARS 216.203-4 Fixed Price Contract with Economic Price Adjustment.

The Government does not intend to amend the RFP solicitation and deviate from DFARS 52.216-4 ((4) The aggregate of the increases in any contract unit price made under this clause shall not exceed 10 percent of the original unit price. There is no percentage limitation on the amount of decreases that may be made under this clause.). However, it should be noted that if a scenario arose during a period that is covered under the EPA clause, the PCO can request a waiver and make a contract price adjustment that is equitable.

153 H.3.1

Section H.3.1 states the EPA clause only applies to vehicle CLINS. It does not cover trailers or kits despite the fact that there are parts on the vehicle that are identical to those on the trailers. For example, the tires are the same on the vehicle and trailer.

Therefore, the current EPA is applicable to the tires on the vehicle but not the trailers. Additionally, inflation experienced on the trailers and kits normally

The Government intends to update Section H.3.1 to add JLTV-T under the same index. The Government does not intend to add kits.

DISTRIBUTION STATEMENT A: Approved for public release; distribution unlimited.

Solicitation W56HZV-20-R-0072, Questions & Answers mirrors that seen in the vehicle, even where parts are not identical.

Would the government consider expanding the applicability of the EPA to include the trailer and kit CLINS?

H.3.6

Section H.3.6 states the EPA is applied to 70% of the vehicle price, which approximates the percentage of material content in the vehicle cost. In the current inflationary environment, labor, freight and overhead cost have also seen significant inflationary pressure.

Would the government consider applying the EPA to a larger percentage of the vehicle – 90% or 100%?

The Government will adjust the percentage of the EPA clause (due the addition of the trailer) to 75%, which is the approximate value tied to vehicles and trailers on this 10 year contract.