Our latest report on the on-going saga of the Army’s Family of Medium Tactical Vehicles (FMTV) award indicated the areas of protest—both the areas sustained and those denied by the GAO.  At that time, we predicted, “unless the Army seriously misevaluated the offers, or seriously misled the GAO, we don't think the original award to Oshkosh will be changed.”  Looks like our prediction was spot-on.

On February 12, 2010 the Army announced that it had completed its “re-evaluation” and, as a result—

Oshkosh Corp. has been awarded a competitive, five-year requirements contract for production of up to 12,415 trucks, 10,926 trailers, and associated support and engineering services. The total estimated contract value at award was $3.023 billion.

The official announcement notes that a peer-review of the re-evaluation was performed by the Office of the Secretary of Defense.

This is bad news for BAE Systems, whose Sealy, Texas subsidiary was the FMTV incumbent contractor.  According to this report by the Wall Street Journal—

With confirmation of this decision the group will include in its 2009 accounts an impairment of goodwill and other intangible assets amounting to GBP592 million relating to the Armor Holdings Inc. transaction and specifically the FMTV product line.  [Currency conversion:  US$ 927.2 million.]

Predictably, Texas politicians were unhappy at the outcome.  One “gentleman” from Texas had this to say—

For nearly two decades, Sealy, Texas, has been the manufacturing home of the Army’s FMTV truck. There, thousands of proud Texans have contributed countless hours to the production of world-class vehicles for our troops, who deserve – and have received – nothing less than the best. The Army’s decision to discard this important and valuable asset is ill-informed, and it makes no sense.

Naturally, Oshkosh was “very pleased” by the outcome.  Life is sweet in Wisconsin these days, if a bit chilly.