McGregor Manufacturing Corporation, B-285341, August 18, 2000

B-285341 Aug 18, 2000 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights A large number of the parts were back-ordered. A number of helicopters for which the part were ordered were not able to perform their missions. The protester had experienced many performance delays and had not successfully produced even one usable item for the agency by the time the urgent buy was initiated. A deswirl duct is a component of the Hover Infra Red Suppressor System. Which is deployed on the UH-60 Blackhawk helicopter. Destroy the helicopter while it is hovering. The only approved sources for deswirl ducts were GE (the original equipment manufacturer) and Sikorsky Aircraft Corporation (the prime contractor for the UH-60 helicopter). All of the Army's purchases of deswirl ducts were either from Sikorsky. View Decision Matter of: McGregor Manufacturing Corporation File: B-285341 Date: August 18, 2000 DIGEST Attorneys DECISION McGregor Manufacturing Corporation (McGregor) protests the United States Army Aviation & Missile Command's (AMCOM) issuance of a delivery order to General Electric Company (GE) for deswirl ducts. /1/ The protester contends that the Army unreasonably determined that it had an urgent need for deswirl ducts and, therefore, improperly acquired them from GE on a sole-source basis without allowing McGregor to compete for the contract. We deny the protest. A deswirl duct is a component of the Hover Infra Red Suppressor System, which is deployed on the UH-60 Blackhawk helicopter. The system recirculates hot exhaust gases, mixing them with cooler ambient air, before releasing the exhaust gases into the atmosphere at a cooler temperature. The system reduces the ability of heat-seeking missiles to lock on, track, and destroy the helicopter while it is hovering. Contracting Officer's Statement at 1 n.1. Before 1996, the only approved sources for deswirl ducts were GE (the original equipment manufacturer) and Sikorsky Aircraft Corporation (the prime contractor for the UH-60 helicopter), and all of the Army's purchases of deswirl ducts were either from Sikorsky, with GE as a subcontractor, or from GE directly. However, there never was any real competition to supply the Army with deswirl ducts because Sikorsky never competed with GE. Contracting Officer's Statement at 2. In 1996, McGregor submitted a source approval package for this part to the Army and became an approved source. The Army explained that, shortly thereafter, believing that the technical data package (TDP) was adequate to allow McGregor to produce deswirl ducts, the Army conducted its first competitive procurement for deswirl ducts. Hearing Transcript (Tr.) at 51-53. /2/ Sikorsky declined to compete, and only GE and McGregor submitted proposals. Although GE's price was lower than McGregor's, GE's proposal was nonresponsive to the required delivery schedule. Agency Report, Tab 10, Price Negotiation Memorandum, at 1-2. Thus, in August 1996, the Army awarded its first contract to McGregor (contract No. DAAJ09-96-C-0319, hereinafter referred to as contract 0319) for 343 deswirl ducts. Contracting Officer's Statement at 1-2. McGregor and the Army experienced numerous delays under contract 0319 that prevented McGregor from manufacturing acceptable deswirl ducts in accord with the original contract schedule. See generally Contracting Officer's Statement at 2-10; Protester's Comments at 5-22. We briefly describe below several instances that are both significant and illustrative of the numerous delays incurred. Some of the delay resulted from alleged deficiencies in the TDP that McGregor informed AMCOM it had discovered shortly after contract award and which McGregor asserted required resolution before McGregor could begin to manufacture the first article unit. For example, the TDP was missing a "mylar" template--a full-scale plastic template, similar to a sewing pattern, used to manufacture deswirl ducts. Contracting Officer's Statement at 2-3; Agency Additional Statement, June 28, 2000, at 1. Since AMCOM did not have the mylar template and Army engineers were unable to obtain it from Sikorsky, the Army gave McGregor a sample of the part for which the mylar template was used, and McGregor used reverse-engineering to create the mylar template. Contracting Officer's Statement at 3. Yet another delay arose out of a dispute regarding McGregor's decision to use an automated welding process to manufacture the deswirl ducts. Apparently, the Defense Contract Management Command's quality assurance representative insisted that McGregor had to weld the production units manually, because McGregor's first article had been manually welded. After much discussion and considerable delay, the agency agreed to automated welding, contingent upon McGregor's first production unit using automated welding passing a second fit verification test; several additional months passed before the fit test was successfully completed.