ABS ESC JA Redacted (1)_Redacted (as of 7 Sep 23).pdf

CMO Control Number: 2022-065

Justification Review Document for Other than Full and Open Competition

Program/Equipment: HIGH MOBILITY MULTI-PURPOSE WHEELED VEHICLE

(HMMWV) ANTI-LOCK BRAKE WITH ELECTRONIC STABILITY CONTROL

(ABS/ESC) RETROFIT KITS

Authority: 10 U.S.C. 2304(c)(1), repealed, transferred, and renumbered as 10 U.S.C.

3204(a)(1), FAR 6.302-1(a)(2)(ii), “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.”

AMOUNT: OPSEC

An award to a source other than Ricardo Defense would result in an unacceptable delay in meeting the Army requirement. If the proposed action for HMMWV ABS/ESC solution were competed under full and open competition, a minimum delay of 28-42 months would occur. The schedule impacts of an award to another contractor are described below and includes competitive contract award, design and development, testing, and logistics product development:

Capabilities Time Reference Competitive Contract – Source Selection 4-6 months 5b(i) Design and Development – Engineering, Test & Evaluation, and Logistics Products

24-36 months 5b(ii)

TOTAL 28-42 months

i. Competitive Contract Source Selection (4-6 months): Based on PD LTVs previous experience with competitive source selections (Light Engineering Utility Trailer and M200A1), it will take a total of 4 to 6 additional months to conduct a competitive procurement over a sole source procurement. This additional time includes the Source Selection Plan and evaluation criteria development, evaluation of offers utilizing a Source Selection Evaluation Board, discussions, and award.

ii. Design and Development (24-36 months). The Government would have to conduct extensive design, testing, and evaluation, similar to what was done on the Ricardo system as detailed above, to obtain a safety confirmation to validate a new system for fielding. There would also be a requirement to develop and validate new logistics support products. Based on recent experience with developing the Ricardo Defense ABS/ESC solution, testing the solution, and development of technical data and logistics products PD LTV estimates the subject effort would take approximately 24 months to complete from contract award if a contractor already has a system developed and 36 months if a new system is being developed.

Based on the factors above, an award to a contractor other than Ricardo Defense would result in an unacceptable delay. The need to acquire the ABS/ESC system quickly to support HMMWV safety is imperative, evidenced by the significant Congressional Add the program received in FY22. It is vital that the HMMWV fleet is retrofitted with this critical safety solution to help mitigate rollover accidents, potentially leading to injury and loss of life. A delay of this magnitude will ultimately compromise the safety of our soldiers and civilians who may encounter HMMWVs on public transportation roads and highways.

Therefore, Ricardo Defense is the only source that can meet the requirements without unacceptable delay as it possesses the approved safety certified solution and level of expertise for production, with associated logistics products necessary to sustain the system.

6. Efforts to Obtain Competition:

a. Effective Competition: The Government intends to solicit only to Ricardo Defense for this acquisition, based on the rationale provided in paragraph 5. The notices required by FAR 5.201 will be published, and any proposals received will be considered.

b. Subcontracting Competition: At the subcontracting level, emphasis will be placed on the contractor’s obligation to continue competitive placement of purchase orders and contracts to maximize competition of components and parts. FAR 52.244-5, Competition in Subcontracting, is in the contract to maximize competition in subcontracting efforts and enforce Government rights for future procurements. Ricardo Defense has had a small business subcontracting plan in place since the start of contract W56HZV-21-D-0008. The subcontracting plan was reviewed and approved by the Office of Small Business Programs and Small Business Administration Procurement Center Representative and is incorporated by reference into the contract. An amendment to the existing subcontracting plan is required as the intended modification is over the $750k threshold.

7. Actions to Increase Competition: Ricardo Defense owns the proprietary rights to the technical data and program software for the ABS/ESC system. The Government asked Ricardo Defense if they are willing to sell their technical data and or ABS/ESC Retrofit Kits for the HMMWV Family of Vehicles (FoV) to private companies for the purpose of Government initiated HMMWV retrofit, reset, and recap efforts. On 21 November 2019, a response was received that Ricardo Defense is not willing to sell the ABS/ESC retrofit kit Technical Data to private companies for the purpose of Government initiated HMMWV Retrofit, Reset, and Recap efforts and is not willing to sell the physical ABS/ESC Retrofit Kits for the HMMWV family of vehicles (FOV) to private companies for the purpose of Government initiated HMMWV Retrofit, Reset, and Recap efforts. Ricardo also stated that they are not willing to sell their data to the Government. On 28 March 2022 the Government asked Ricardo Defense if they are willing to enter negotiations regarding Specifically Negotiated License for HMMWV ABS/ESC Retrofit Kits. Ricardo Defense replied on 30 March 2022 stating it does not have an interest in entering negotiations to offer a license for ABS/ESC Retrofit Kits Technical Data Package. As a result, it is not possible to compete the current acquisition.

8. Market Research: PD LTV issued a Sources Sought Notice (SSN) on SAM.GOV website on 9 May 2022 and it closed on 20 May 2022. The intent of the SSN was to seek additional providers of the required Retrofit Kit. The SSN identified the requirement described herein and stated that all responsible sources may submit a capability statement which will be considered by the agency.

Responses: Two companies responded to the sources sought: (1) D Gillette Industrial Services, Inc. (DGI) and (2) Ricardo Defense Inc. A technical review was performed and it was determined that of the respondents, only Ricardo Defense showed the requisite capability to provide material that has been tested to satisfy the requirement due to the development and ownership of the technical data. In addition, since of the main functional components are source controlled to Ricardo Defense, other companies will be required to acquire hardware from Ricardo Defense.

The Government conducted market research on 28 March 2022 to determine if Ricardo Defense is willing to enter negotiations regarding Specifically Negotiated License for HMMWV ABS/ESC Retrofit Kits. Ricardo Defense replied on 30 March 2022 stating it does not have an interest in entering into negotiations to offer a license for ABS/ESC Retrofit Kits Technical Data Package.

9. Interested Sources: As identified in section 8, a sources sought notice was issued in May 2022 and results determined only Ricardo Defense showed the requisite capability to satisfy the requirement.

AM General submitted a Value Engineering Change Proposal (VECP) in October 2018, and a revised VECP in June 2019. To date, the program office has not accepted their solution due to the gaps in compliance to the requirements, supporting test data, and logistics products. Should AM General submit a new or updated VECP, PD LTV will evaluate the submission accordingly.

10. Other Facts:

a. Procurement History: The current ABS/ESC Retrofit Kit contract W56HZV-21-D- 0008 is a Firm-Fixed-Price, 3 year IDIQ contract, awarded to Ricardo Defense on 16 March 2021 on a sole source basis justified in accordance with FAR 6.302- 1(a)(2), “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements” and is the only ABS/ESC Retrofit Kit contract to date.

However, the same Ricardo ABS/ESC system has been supplied and installed (as a subcontract arrangement with AM General) on the following HMMWV production contracts:

i. AM General HMMWV Production Contract number W56HZV-15-D-0102, awarded on a sole source basis in accordance with 6.302-1(a)(2)(ii)(A) and (B), “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements” and incorporated the ABS/ESC ECP into HMMWV production in July 2018. Under this action, 114 Ricardo Defense ABS/ESC systems were installed in a new production environment.

OPSEC