The Government Accountability Office sustained a protest by General Dynamics [GD] on the Navy’s surface electronic warfare improvement program (SEWIP) Block 1B3 full rate production requirement, throwing Lockheed Martin’s [LMT] award into question.
GD alleged that the government conducted erroneous cost realism analysis that assumed that the company met requirements only by not compensating overtime, and then made and “incorrect and unreasonable” increases to GD’s cost proposal. Because the contract was awarded to the “lowest cost technically acceptable” bidder, GD lost to Lockheed Martin, whose offering was estimated to be more $10,000 less expensive, according to GAO.
The office recommended that the Navy conduct a “reasonable cost realism evaluation” of GD’s proposal as well as new analysis of its detailed cost breakdown. “Under the terms of the RFP, the agency may also elect to conduct discussions with the offerors concerning their cost/price proposals, request revised cost proposals, and conduct a new cost realism analysis,” the GAO stated in its decision.