U.S. defense officials have handed a major contracting victory to Oshkosh Corp., announcing recently that the company will continue to provide the Army’s Family of Medium Tactical Vehicles (FMTV) despite significant protests from more established competitors.
Oshkosh has estimated the work eventually to be worth $3 billion for the production of FMTVs, which are the backbone of the U.S. Army resupply and ground transport fleet. The decision overrules the protest filed by BAE Systems — which had previously produced more than 56,000 FMTV trucks and trailers — and calls for production of up to 12,415 trucks and 10,926 trailers, along with support and engineering services.
Oshkosh originally won the recompete contract for the FMTV in August 2009, but by October, BAE and Navistar Defense had filed protests with contracting referees in the congressional Government Accountability Office, with BAE complaining it was “increasingly convinced the service’s source selection evaluation was flawed and that the Army did not follow its own stated objective to conduct a best-value FMTV competition based on a clear-cut set of criteria.”
In December, GAO managing associate general counsel Michael Golden replied to the protests, writing that his office’s review “led us to conclude that the Army’s evaluation was flawed with regard to the evaluation of Oshkosh’s proposal under the capability evaluation factor, and the evaluation of Navistar’s past performance.” Still, GAO had “denied a number of Navistar’s and BAE’s challenges to the award to Oshkosh, including challenges to the evaluation of Oshkosh’s price.”
In turn, the Pentagon announced late Feb. 12 that from Dec. 21, 2009, to Jan. 22, the Army re-evaluated the proposals in accordance with GAO’s recommendation. “Subsequently, there was an Office of the Secretary of Defense peer review affirming the Army’s re-evaluation process.”
The contract is another huge win for Oshkosh, a company that recently won the lucrative MRAP-All Terrain Vehicle (M-ATV) contract, currently valued at about $4 billion and climbing for 6,600 of the tactical vehicles, and has signed more than $190 million in contracts to retrofit its TAK-4 suspension on thousands of Mine Resistant Ambush Protected (MRAP) variants.
As for BAE, the news may be even less sanguine, especially since it spent $4.53 billion on its acquisition of Armor Holdings, and given its loss of the M-ATV contract and the end of MRAP production, which the company dominated.