Associated Schools of Construction
Proceedings of the 55th Annual Conference of the Associated Schools of Construction
Design-Bid-Build infrastructure projects with Unit-Price Contracts have a high risk of quantity and price deviations. Those deviations might be the result of contractors' unbalanced bidding. At the same time, contractors' performance was unknown under unbalanced bidding situations. The researchers utilized the First Order Reliability Method and Statistical Analysis to evaluate contractors' bidding performances and engineers' estimating performances with bidding and settlement data of 163 NDDOT projects. Results showed that contractors adopted unbalanced bidding strategies as follows: if quantities were overestimated, then they underrated unit price; if quantities were underestimated, then they overrated unit price to maintain projects' Bid Total Amount slightly less than Estimated Total Cost. Contractors had a 49% probability of failure in unbalanced bidding. Engineers had an 83% probability of failure in quantities overestimated and 15% in quantities underestimated. Among the estimating uncertainties, Design Errors or Changes were the main reasons of engineers' overestimating failure. The researchers recommend the use of cooperating project delivery methods such as design-build to protect owners' interests in infrastructure projects. In addition, engineers should improve their estimating accuracy by reducing design errors or changes. These research findings will help to reduce unbalanced bidding practice in public funded infrastructure projects.
Jiang, Yuhan; Bai, Yong; Han, Sisi; and Lin, Ting, "Probability of Failure in Infrastructure Project Unbalanced Bidding" (2019). Civil and Environmental Engineering Faculty Research and Publications. 272.
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