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![handle is hein.gao/gaobaaxdn0001 and id is 1 raw text is:
DCCOMNT RESUME
05786 - o81025976]
fDefense Subcontract for Machine Tools to Mitsubishi
Corporation]. PSAD-78-91; B-191079. April 5, 1973. Released
April 12, 1978. 2 pp.
Report to Rep. Bill Gradison; by Richard W. Gutmann, Director,
Procurement and Systems Acquisition Div.
Issue Area: Federal Procurement of Goods and Setvices (1900).
Contact: Procurement an Systems Acquisition 1iv.
Budqet Function: National Defense: Department of Defende -
Procurement 6 Contracts (058).
Orqaniz ,ion Concerned: Department of Defense; Department of the
Army; Android Corp.; Mitsubishi Inteihatina1 Corp.; Carlton
Machine Tool Co.; Chrysler Corp.
Conqressional Relevance: Rep. Bill Gradison.
Authority: Buy American Act. A.S.P.R. 3-805.3.
The Chrysler Corporation, uader a contract with the
Department of the Army, awarded a sutcontract for a tank turret
machininq systow to the Android Corpczation and a Japanese firm,
Mitsubishi Internatiunal Corporation. Carlton machine Tvol
Company's bid was approximately $200,000 more than the
Android/Mitsubishi bid after adjustments in accordance with the
Buy American Act. The contracting practices and procedures used
by prime contractors of the Government are geneL.lly not subject
to the statutory and regulatory requirements which goveQT direct
procurement by a Federal agency. However, a basic principle
prohibits the exposure of the lowest price to competing cfferors
in order to provide them with the opiortunity to match the lower
bid. Therefore, it would not have been proper for Chrysler to
have permitted Carlton to lower its bid in crder to obtain the
subcontract. Regarding questions about Android's financing,
Chrysler is responsible to the Army for the performamce of the
prime contract and for the perfcrmance of the subcontractors it
selected. Although Chrysler may own 151 of Mitsubishi, there is
no regqulation or contract provision Fiohibiting the award of a
subcontract to a company partially owned by the prime contractor
as lonq as adequate price competition is maintained. (RRS)](ViewImageLocal?handle=hein.gao/gaobaaxdn0001&div=1&collection=&method=preview&ext=.png&size=3)