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ARC Group nabs $7.2B DoD contract for moving services

An American Roll-on Roll-off Carrier vehicle loading helicopters and boxes of household goods boxes at the Port of Bremerhaven, Germany. ARC was awarded a $7.2 billion contract to move household goods for military personnel Thursday. Photo courtesy of American Roll-on Roll-off Carrier via Twitter
An American Roll-on Roll-off Carrier vehicle loading helicopters and boxes of household goods boxes at the Port of Bremerhaven, Germany. ARC was awarded a $7.2 billion contract to move household goods for military personnel Thursday. Photo courtesy of American Roll-on Roll-off Carrier via Twitter

April 30 (UPI) -- U.S. Transportation Command has awarded a $7.2 billion Global Household Goods Contract to American Roll On Roll Off Carrier Group, the Pentagon announced Thursday.

In January the DoD announced it intended to overhaul the system for moving service members' household goods across the country and around the world.

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That deal marks a consolidating shift in the DoD's strategy, from working with 42 government-managed shipping offices and subcontracting with hundreds of local moving and storage companies -- to instead working with one primary vendor.

American Roll-on Roll-off Carrier operates liner services in the international trades, as well as providing port-to-port and end-to-end transport of heavy vehicles, helicopters and other equipment for various U.S. government agencies.

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The contract announcement does name four principal subcontractors -- Unigroup, Suddath Companies, Atlas World Group and The Pasha Group -- to carry out the moves and ensure a minimum of 40 percent of the total acquisition value of the domestic work performed flows down to small businesses.

"Small businesses are-and will remain-the backbone of this program," said Rick Marsh, director of the Defense Personal Property Program at USTRANSCOM, in a Pentagon news release. "If a company delivers a quality product in today's program, there is room for them in tomorrow's. Their capacity will remain critical as long as DOD moves personnel and their families around the globe."

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The contract award is part of a larger effort to improve the relocation process for military families, officials said.

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A Pentagon Inspector General's report released in January said 41 percent of military members who moved during fiscal 2018 received their household goods shipments late; another 21 percent had their property damaged during a move.

The report also said companies involved in relocating military families rarely face reprimand, let alone steeper consequences, for failing to deliver belongings intact and on time.

"DOD families are our North Star and the reason we are making this change to the Defense Personal Property Program," said U.S. Army Gen. Stephen Lyons, commander, USTRANSCOM. "The contract was written by and for the Military Services, and addresses long-standing pain points DOD families have highlighted for years."

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According to the Pentagon, the government will continue to maintain ordering of services and will implement an accountability program for contractors.

USTRANSCOM and ARC will spend the next nine months integrating IT systems and processes, with the first move under the new contract planned for February 2021, putting ARC in a position to handle 100 percent of shipments in the continental United States during 2021's "peak season."

All shipments scheduled for 2020 will move under the existing program.

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There are likely to be fewer this year due to a stop-movement order issued in March in response to the novel coronavirus -- though last week Defense Secretary Esper announced some scheduled changes of station would go forward as planned.

March's stop-movement order placed some military families in housing limbo, paying rents in two locations, and prompted Lyons to express concern about small moving companies and prompting moving companies to request $187 in government stimulus money -- which they did not get.

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