GAO Decision Affirms Major Army Conclusions Supporting Oshkosh FMTV Award; Denies Challenges to $440 Million Dollars in Savings And Nearly All Other Protestor Complaints
OSHKOSH, Wis. — Dec. 17, 2009 — The U.S. Army’s conclusion that Oshkosh Corporation (NYSE: OSK) proposed the lowest price and has the capability and experience to build the Family of Medium Tactical Vehicles (FMTV) was unchallenged by the Government Accountability Office’s (GAO) decision, released in redacted form today. The decision significantly expands on the GAO’s press release of December 14, 2009, regarding the protests against the U.S. Army’s award decision by BAE Systems and Navistar Defense.
The decision by the GAO upheld only two narrowly-defined aspects of the protests against the U.S. Army by the disappointed bidders, rejecting all of the numerous other protest grounds raised during the three-month protest process which covered virtually every aspect of the evaluation.
The GAO determined that the Army erred in evaluating one element of the broader production capability subfactor. To address this, the GAO recommended that the Army re-evaluate the offerors’ proposals as to this element and also determine whether there was any possible impact on a second element. These elements are just two of seven elements in the production subfactor of the capability evaluation factor, all of which receive less weight than price. The GAO provided no opinion as to whether the re-evaluation of these two elements would in fact change the award decision by the Army.
The Oshkosh proposed price is significantly lower than what the Government is currently paying the incumbent FMTV contractor and was revealed today to be nearly $440 million lower over the life of the contract than that proposed by incumbent BAE. Widely publicized protestor complaints relating to Oshkosh’s price, armored cab design, financial stability and manufacturing prowess all were denied by the GAO. The GAO stated in its decision, “With the exception of two areas, we find that the [Army’s] evaluation was reasonable.” Oshkosh Defense was awarded the contract on August 26, 2009.
“After a thorough acquisition process by the Army that began nearly seven months ago, followed by formal protests that took three months to resolve, we believe the Army will quickly and appropriately address the GAO’s recommendations,” said Robert G. Bohn, Oshkosh Corporation chairman and chief executive officer. “We believe that in its review, the Army will find that Oshkosh Corporation was and continues to be the correct choice for the FMTV contract, providing proven capability and the best value to the Army and the taxpayer.”
As the GAO’s decision reaffirms, Oshkosh was awarded the contract because the company bid the FMTV at a very competitive price while receiving excellent evaluations for meeting vehicle production and delivery requirements, including any possible production surges that might be required by the Army.
The U.S. Army has 60 days from December 14, 2009 to act on the GAO’s recommendations and report its findings.
“Oshkosh plans to build the FMTV and meet all of the Army’s objectives while saving hundreds of millions of taxpayer dollars that the Army can use for other pressing requirements,” Bohn said. “And we will do this without impacting our other existing or proposed military vehicle contract programs.”
Bohn added, “It is important to realize the GAO’s decision did not recommend that the proposals be recompeted or revised, nor did it recommend termination of our contract. We believe that the redacted decision issued today further supports our assessment that Oshkosh is in a strong position to retain the contract when the two narrow issues on which the protests were upheld are reconsidered.”
Oshkosh remains the only current manufacturer of both medium and heavy tactical wheeled vehicles in the U.S. defense industry, having produced more than 70,000 military-class vehicles in its manufacturing facilities. Oshkosh Corporation’s proven production capabilities were recently recognized by the National Center for Advanced Technologies (NCAT), which awarded Oshkosh with a 2009 Defense Manufacturing Excellence Award for its M-ATV launch team, which has exceeded delivery requirements for every month since the contract award on June 30, 2009.
About Oshkosh Defense
Oshkosh Defense, a division of Oshkosh Corporation, is an industry-leading global designer and manufacturer of tactical military trucks and armored wheeled vehicles, delivering a full product line of conventional and hybrid vehicles, advanced armor options, proprietary suspensions and vehicles with payloads that can exceed 70 tons. Oshkosh Defense provides a global service and supply network including full life-cycle support and remanufacturing, and its vehicles are recognized the world over for superior performance, reliability and protection. For more information, visit www.oshkoshdefense.com.
About Oshkosh Corporation
Oshkosh Corporation is a leading designer, manufacturer and marketer of a broad range of specialty access equipment, commercial, fire & emergency and military vehicles and vehicle bodies. Oshkosh Corp. manufactures, distributes and services products under the brands of Oshkosh®, JLG®, Pierce®, McNeilus®, Medtec®, Jerr-Dan®, Oshkosh Specialty Vehicles, Frontline™, SMIT™, CON-E-CO®, London® and IMT®. Oshkosh products are valued worldwide in businesses where high quality, superior performance, rugged reliability and long-term value are paramount. For more information, log on to www.oshkoshcorporation.com.
®, ™ All brand names referred to in this news release are trademarks of Oshkosh Corporation or its subsidiary companies.
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