The US Department of Defense has cancelled its Global Household Goods contract (GHC), citing concerns about provider HomeSafe Alliance (HSA)’s ability to deliver services.
The contract – which is believed to have been worth up to US$20 billion over its maximum potential nine-year duration – had been beset by issues, including legal challenges and delays. Domestic moves under the agreement were reported to have begun in nine states in September 2024.
An official statement issued on June 18 said the contract with HSA had been cancelled ‘due to HSA’s demonstrated inability to fulfil their obligations and deliver high-quality movers to service members.’ It said the Secretary of Defense has named Army Maj Gen Lance Curtis as the new head of the Permanent Change of Station (PCS) Joint Task Force (JTF), which will have ‘the authority to decisively act and make immediate improvements to the DoD Personal Property Program’.
Commenting on the news, FIDI’s Secretary General, Jesse van Sas, said: ‘Though the US military contract would not have impacted the vast majority of FIDI Affiliates directly, the repercussions of the implementation did – and would continue to – cause major disruption in the international removals marketplace, with lots of moving businesses repositioning themselves.
‘I think we all acknowledge that we live in a globalised market, but concentrating such an immense volume of moves into the hands of one entity entails enormous risks, both operationally and financially. And the question remains: how does it serve the end customer? Why would the customer be better off being served by a huge move-management business managing an enormous supply chain? Where is the benefit to them?’
He added that despite the negative result of the GHC exercise, he believed there may be attempts to revive the contract. ‘The total US military market value is just too tempting,’ he said.
President of IAM Brian Limperopulos said the announcement was ‘massive news for the moving industry… perhaps the biggest story of the year’.
He added: ‘IAM members and other moving providers have served military families faithfully throughout the intended transition, and we hope this faith is repaid with greater collaboration and collective problem-solving on the challenges facing military moving as we move into the future.’
Anthony Shipp, CEO of Hawaii-based M Dyer Global, who has previously spoken out about the viability of the GHC, said the news is ‘one the most consequential reversals in the history of US government contracting in our industry’, adding that he believed HSA – a joint venture between KBR and TierOne Relocation – would now collapse.
‘While the parent companies will continue to operate independently, HomeSafe itself is effectively defunct,’ he said. ‘Whether they enter bankruptcy or simply wind down is still unclear, but there is no functional pathway for recovery under the current circumstances.’
Shipp said he believed the restart of bidding and adoption of HomeSafe as a provider was a ‘highly speculative long shot’.
‘For the rest of us, though, this is a definitive and hard-fought win,’ he said. ‘The advocacy effort – fuelled by companies who believed in fair competition and transparent oversight – prevailed. We fought to preserve the integrity of our sector, and in doing so, we defended the principles of a free market against an imposed monopoly. That matters.’