GM to build Chevy Colorado ZR2-based Infantry Squad Vehicles for U.S. Army

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Hi, we’re GM, we turn a ZR2 into a Jeep with a couple extra seats as a $145k option.
So I think there's some confusion w/ how the DoD does Systems procurement. It's not as if they go to the dealership and purchase vehicles for 'X' amount (ie. Firm Fixed Price). Note - I don't really support system or program procurement but I do work for 'in house' General Counsel for Information Technology Gov. procurement. For instance, when my agency buys computers, we set forth minimum acceptable standards and performance; while we may buy a computer for more than you could at Best Buy these contracts include: upgrades, tech, support, extended warranties and so forth. Actually, our current setup was a lease agreement w/ later buyout.

As for buying American, w/ National Defense Procurement they're actually mandated by law to buy items from allies, and or domestic suppliers. You can certainly understand the rationale behind that. For instance, why we don't buy night vision equipment from China or export F16s to North Korea (the limitations apply to exports as well).

For a systems procurement it involves lifetime maintenance, often manufacturer support, w/ modern weapons systems software licensing and upgrades & so forth. So don't think that they are actually simply buying a ZR2 for 200k; it's more like their buying a vehicle with a LIFETIME cost of 200k, which when you factor in usage and age, it works out pretty well.

Again, I'm not an expert on system procurement nor do I work for DoD, but the price is not really what you guys are thinking.

And I'm not anywhere involved w/ this contract but that price may even include signal jammers like the DUKE which prevent command detonated IEDs (I honestly don't know what's in this procurement) but you don't even want to know how much those things cost. Then sometimes there's, depending on the item/procurement, security restrictions on the employees actually building the item, these types of costs are ALL factored into a contract typically. There's ALL kinds of goodies that that 200k price more than likely includes; it adds up.



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Here's a MICRO, MICRO example of a procurement.

This is an article about the US Gov Skillcraft pen (my personal fav!). Look at the technical requirements......for a pen.

"There are 16 pages worth of requirements, to be precise. The pens must be able to write a continuous line 1 mile (1.6 kilometers) long and keep the ink flowing despite extreme temperatures — from 40 degrees below zero to 160 degrees (4 to 71 degrees Celsius). "

Skillcraft Pen Article

Now imagine that w/ a vehicle 😲 and multiple suppliers/distributors. Now imagine distribution, training, maintenance and repair for this complicated system.....
Hell, just imagine getting all the trucks and parts to ALL of the different locations and users, just think of the shipping costs to send say 2 or 3 extra alternators to motor-pools all over the world. That's how we hit 200k on a vehicle.
 

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So I think there's some confusion w/ how the DoD does Systems procurement. It's not as if they go to the dealership and purchase vehicles for 'X' amount (ie. Firm Fixed Price).

Again, I'm not an expert on system procurement nor do I work for DoD, but the price is not really what you guys are thinking.

And I'm not anywhere involved w/ this contract but that price may even include signal jammers like the DUKE which prevent command detonated IEDs (I honestly don't know what's in this procurement) but you don't even want to know how much those things cost. Then sometimes there's, depending on the item/procurement security restrictions on the employees actually building the item, these types of costs are ALL factored into a contract typically. There's ALL kinds of goodies that that 200k price more than likely includes; it adds up.
Having worked on DOD programs, bid projects and defended the price estimate to them, you have to understand how DOD programs work.

They say we want feature x and function y. You bid the job at 10,000 Engineering hours for all the concept, prototype, design and test hours required for that. Then they say why so much? You review all their systems requirements with them and say is this what you really want? They say yes to 90%, modify their requirements a little and your new bid is for only 9,500 Engineering hours, just for feature x and function y, this is repeated over all of their requirements. No, very few DOD programs are truly off the shelf regardless of their favorite buzz words, COTS (commercial off the shelf) and Open-Architecture.
 
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Having worked on DOD programs, bid projects and defended the price estimate to them, you have to understand how DOD programs work.

They say we want feature x and function y. You bid the job at 10,000 Engineering hours for all the concept, prototype, design and test hours required for that. Then they say why so much? You review all their systems requirements with them and say is this what you really want? They say yes to 90%, modify their requirements a little and your new bid is for only 9,500 Engineering hours, just for feature x and function y, this is repeated over all of their requirements. No, very few DOD programs are truly off the shelf regardless of their favorite buzz words, COTS (commercial off the shelf) and Open-Architecture.
Agreed, program procurements are almost impossible to be COTS. The only real COTS (at least in my realm) is software and even then as you're aware nothing like a Gov IT security to jackup COTS software, so then we need a bridge or patch, etc....

Oh and licensing agreements, good times, I have a very, very senior attorney who primarily deals w/ licensing agreements and 9 x out of 10 it's just an issue of verbiage.

I can't imagine a program procurement that takes thousands of hrs like you're describing! The closest we get is when we build a site or IT system.
 

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So I think there's some confusion w/ how the DoD does Systems procurement. It's not as if they go to the dealership and purchase vehicles for 'X' amount (ie. Firm Fixed Price). Note - I don't really support system or program procurement but I do work for 'in house' General Counsel for Information Technology Gov. procurement. For instance, when my agency buys computers, we set forth minimum acceptable standards and performance; while we may buy a computer for more than you could at Best Buy these contracts include: upgrades, tech, support, extended warranties and so forth. Actually, our current setup was a lease agreement w/ later buyout.

As for buying American, w/ National Defense Procurement they're actually mandated by law to buy items from allies, and or domestic suppliers. You can certainly understand the rationale behind that. For instance, why we don't buy night vision equipment from China or export F16s to North Korea (the limitations apply to exports as well).

For a systems procurement it involves lifetime maintenance, often manufacturer support, w/ modern weapons systems software licensing and upgrades & so forth. So don't think that they are actually simply buying a ZR2 for 200k; it's more like their buying a vehicle with a LIFETIME cost of 200k, which when you factor in usage and age, it works out pretty well.

Again, I'm not an expert on system procurement nor do I work for DoD, but the price is not really what you guys are thinking.

And I'm not anywhere involved w/ this contract but that price may even include signal jammers like the DUKE which prevent command detonated IEDs (I honestly don't know what's in this procurement) but you don't even want to know how much those things cost. Then sometimes there's, depending on the item/procurement, security restrictions on the employees actually building the item, these types of costs are ALL factored into a contract typically. There's ALL kinds of goodies that that 200k price more than likely includes; it adds up.
Thanks for the information. That actually makes more sense, I didn’t realize that price included lifetime maintenance.
 
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Thanks for the information. That actually makes more sense, I didn’t realize that price included lifetime maintenance.
It may, I'm not 100% it would be w/ this vehicle; I don't know any specifics about this program. That price can include all kinds of stuff: testing, maintenance, upgrades, etc. But typically cost per vehicle is cost spread out over several years & like North said the development and testing was also factored in. If you apply the cost per vehicle like you and I would buy at the dealership then yeah, it can be mind-blowing (y)
 

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I can't imagine a program procurement that takes thousands of hrs like you're describing! The closest we get is when we build a site or IT system.
Any large DOD program, aircraft, satellites, munitions and many smaller ones.
 
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Any large DOD program, aircraft, satellites, munitions and many smaller ones.
You misunderstood me, I was agreeing w/ you and stating that I don't deal w/ programs like that and that I couldn't imagine what it would be like to work on one like that (i.e. thanking my lucky stars)

I completely understand that any large system would be crazy man hours.
 

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