Md. firm alleged to offer Navy $544 part worth $10

March 30, 1994|By Gilbert A. Lewthwaite | Gilbert A. Lewthwaite,Washington Bureau of The Sun

WASHINGTON -- A Maryland defense contractor has been accused by a member of Congress of seeking to charge the Pentagon $544 for a spark-plug connector that was available from an auto-parts shop for $10.

The contractor, PioneerUAV Inc. (PUI) of Hunt Valley, was one of three companies -- two from Maryland -- cited by Rep. Norman Sisisky, the Virginia Democrat who chairs the House Armed Services Committee's investigations subcommittee, as seeking "excessive prices for commonly available spare parts."

The $544 spark-plug connector was offered as a spare part for the Pioneer drone, a pilotless aerial surveillance plane made in Maryland, according to a statement from Mr. Sisisky that was first carried in the current edition of Defense Week.

Mr. Sisisky cited the spark-plug connector as one of several "egregious examples" of overpricing in the Pioneer program. Mr. Sisisky was given one of the connectors by a supply officer in the Navy's unmanned aerial division, which oversees the Pioneer program.

A congressional staff member phoned the manufacturer, Robert Bosch GMBH of Stuttgart, Germany, and was given the address of the Washington-area supplier, an auto-parts shop. The staff member then bought the connector there for $10.77.

Warren Nelson, the director of oversight investigation for Mr. Sisisky's subcommittee, said the shop-bought plug connector was identical to the $544 connector offered by PioneerUAV.

"It is exactly the same product," Mr. Nelson said. "It has the same particular part number stamped on the side. What we are saying is, this part was identical to the part bought at the local auto supplier."

Jim McCune, president of PUI, confirmed that his company offered the spark-plug connector at $544.

But he said the Navy did not buy it. The quoted price, Mr. McCune said, was based on its being ordered from Germany to fit Navy specifications.

"I don't know whether you can buy it for $10 or not," Mr. McCune said. "That's what they [Mr. Sisisky's staff] say, but not the way they [the Navy] ordered it from us. Where they [the Sisisky staff] got their part from and where we received our quotes from were two different places. How we bid [the contract] was totally in line with regulation and procedure."

Mr. McCune said his company is cooperating with a Navy investigation of Mr. Sisisky's allegations. The investigation is being conducted by the unmanned aerial vehicle division.

Ray Colemon, a spokesman for the division, declined to respond to questions about overpricing.

The congressman also named another Maryland defense contractor, Aircraft Armament Inc. (AAI) of Hunt Valley, and Israeli Aircraft Industries Inc. (IAI) of Israel as participating in overpricing practices.

IAI and AAI formed PioneerUAV Inc. as a joint venture to service the contract for Pioneer drones, designed in Israel, refined here and used for battlefield surveillance in the Persian Gulf war.

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