No, they just talk to each other and take turns being the lowest one.
I mean how many military equipment companies can you sustain with a country the size of California? Whatever your answer, above a certain pay grade, all employees come from a single engineering school anyways.
If you’ve ever looked into military procurement, there are a number of MIL standards and a specific list of requirements. If the product meets specifications and testing results, picking anyone but the lowest bidder accounting for other “soft” commercial aspects such as company stability, leadership, and book health; would be foolish and irresponsible.
I’ve seen several comments here that “military” grade means lowest bidder. That’s optimal.
Look at it this way - consumer market is completely unregulated, no specifications and lots misleading terminology. Any Military would crucify you for fraud.
Is it perfect? No. Is it close to perfection? Yes. Also look into medical grade things such as scissors.
Sometimes the lowest bidder is the lowest because they purposely underbid knowing they will have cost/schedule overruns later and the customer would rather throw good money after bad than start the process over with nothing to show. I like the second lowest bidder process mentioned elsewhere.
I’ve worked in procurement and let me tell you - there is a lot more than looking at a ranked list of bidders and going “oh look, lowest bidder. Job done, let’s go with these folks.” The caricature on HN is so incredibly misleading. Supplier selection is quite involved.