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  • Question

    Is there historical data or method to support the estimation of T4C cost savings (or loss) as well as approximate schedule this typically takes? Thank you


    Answer

    Based on our experience as DAU faculty members who have worked in the int'l acquisition - FMS area, we have never seen any historical data or methods other than the approaches used for DoD domestic T4C situations like this one.

    The only specific example we are familiar with is an International Cooperative Program (ICP) int'l agreement situation (rather than FMS Letter of Offer and Acceptance) where T4C was being considered by the US and other partner nations.  We set up a group that evaluated the prime contractor's T4C proposal(s) focusing on equipment delivered (or not) and information rights of Information use obtained (or not) vis-a-vis potential cost saving resulting from early termination of the contract.  In that situation, the analysis clearly showed that it would be advantageous to the US and partner nations to fund the contract based on the previously agreed scope of work, deliverables, and cost rather than terminate early.  However, as the lawyers often say, this was a fact pattern dependent situation that may or may not apply to other situations.

    Since FMS operates at no cost to the USG, it would appear that the DoD Program Manager's and Contracting Officer's responsibility in the situation you describe would be limited to conveying the desires of the FMS customer nation to the contractor with regard to reduced procurement quantities and advising the FMS customer of the overall impact(s) and cost savings (if any) based on the FMS prime contractor's T4C proposal response(s).   

    Finally, you may wish to consult with your DoD Component Int'l Program Organization -- in this case Deputy Asst Sec Army/Defense Exports & Cooperation -- to see if they have any advice or insights regarding this situation.

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