Price matters a whole lot in contract wins — even when maybe it shouldn't

A couple months ago we learned about issues involving a vehicle shipping contract, which left thousands of military personnel in the dark about where their cars ended up. Now we learn how the contractor came to win that contract.

Protesting contractor: American Auto Logistics LP, Park Ridge, New Jersey

Contracting agency: United States Transportation Command (USTRANSCOM)

Protest issue: Whether the best value determination made by USTRANSCOM was reasonable.

Decision: Protest denied. January 30, 2014 (released by GAO in December 2014)

Post-mortem: This procurement involves a contract for global transportation of privately owned vehicles for military and civilian employees of the Department of Defense. The work included, among other things, operating multiple vehicle processing centers, preparing vehicles for shipment, ensuring that necessary agricultural and customs clearances are obtained, arranging for and/or providing ocean and ground transportation, providing intransit visibility of shipments, storing vehicles, and resolving loss and/or damage claims.

The USTRANSCOM awarded the contract to International Auto Logistics LLC (IAL) of Brunswick, Georgia in the amount of $919 million. AAL, the incumbent, proposed a price of $957 million over slightly less than five years.

The evaluation criteria established that the agency would select the overall "Best Value" for the government based on the technical acceptability of the proposal and a best value tradeoff decision between past performance and price, which were equally rated. The agency was allowed to pay more for better past performance or accept the lower price if a competitor's past performance was not worth the competitor's higher price.