The $30 billion effort to replace the U.S. Army’s Humvee fleet took an unexpected turn on Tuesday.
The Government Accountability Office dismissed a protest by Lockheed Martin, which lost the chance to develop the Joint Light Tactical Vehicle (JLTV) to Wisconsin-based Oshkosh earlier this year when the defense giant caught everyone by surprise and went to court to make its case. Lockheed Martin filed a “Notice of Post-Award Bid Protest” with the U.S. Court of Federal Claims on December 11.
“Our office will not decide a protest where the matter involved is the subject of litigation before a court the U.S. Court of Federal Claims stating its intent to file a protest with the court involving the same subject matter as the protests pending our Office, we are closing our files without further action.”
While filing a protest over such a big-ticket program isn’t unusual – a similar one has been posted for the Air Force’s budget-busting bomber effort -- the timing of Lockheed’s court filing is suspect. The company submitted an initial protest with the GAO back in September, freezing work on the tactical vehicle program until the agency determined if the Army followed government acquisition rules to the letter.
Lockheed also filed two “supplemental protests,” according to the GAO decision, suggesting the company was fired up over losing the initial development contract -- $6.7 billion for around 17,000 vehicles -- to Oshkosh. Indiana-based AM General was also passed over for the JLTV contract but didn’t file a protest.
A GAO decision was expected before the end of this week. That Lockheed went to court suggests the firm suspected it was about to lose and decided to plead its case in federal court, which could prove more costly on a few fronts.
Any company that wants to challenge the award of a federal contract can file a protest with the purchasing agency, the GAO, or the Federal Claims court, according to U.S. code. But only the GAO provides for an automatic stop-work order during the protest period; in court, the judge must be convinced to issue an injunction, according to a source. In addition, GAO is also widely seen as an inexpensive option, while court proceedings can prove more expensive, the source said.
To that end, the agency averages around 2,600 protests per year, documents show. Meanwhile the Claims court averages around 1,000 protests annually, the source estimated.
The Army wants to buy around 49,000 vehicles, with acquisition slated to wrap up in 2040. The Marine Corps hopes to purchase 5,500 trucks and finish production in fiscal 2022. The first wave of JLTVs aren’t expected to hit the field until 2018.
GAO’s decision allowed the Army to lift the stop-work order that had been placed on the program when Lockheed filed its protest.
“We are pleased that the JLTV production contract, awarded to Oshkosh in August, is now moving forward to deliver the world’s most capable light tactical vehicle,” John Urias, Oshkosh Defense’s executive vice president, said in a statement.
“The Army conducted a thorough, methodical procurement including exhaustive testing and evaluation to ensure our troops get the best vehicle,” he added.