DoD awards $836M+ for C-130 Hercules structural component repair, with Lockheed Martin as prime
Contract Overview
Contract Amount: $36,224,789 ($36.2M)
Contractor: Lockheed Martin Integrated Systems, LLC
Awarding Agency: Department of Defense
Start Date: 2003-06-13
End Date: 2008-10-16
Contract Duration: 1,952 days
Daily Burn Rate: $18.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 10
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 200309!000302!5700!GJ40 !WARNER ROBINS ALC/LUK !F0960301D0207 !A!N! !N!0044 !20030613!20050630!836196972!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!6801 ROCKLEDGE DRIVE !BETHESDA !NJ!20817!49756!067!13!MARIETTA !COBB !GEORGIA !+000009151992!N!N!000000000000!J015!MAINT & REPAIR OF EQ/AIRCRAFT STRUCTURAL COMPS !A1A!AIRFRAMES AND SPARES !3ACD!C-130 HERCULES !336411!E! !5!B!M! !C! !99990909!B! ! !A! !A!N!J!2!010!B! !A!N!Z! ! !N!C!N! ! ! !C!D!A!A!000!A!C!N! ! ! ! ! ! !0001! !
Place of Performance
Location: WARNER ROBINS, HOUSTON County, GEORGIA, 31088
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $36.2 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC for work described as: 200309!000302!5700!GJ40 !WARNER ROBINS ALC/LUK !F0960301D0207 !A!N! !N!0044 !20030613!20050630!836196972!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!6801 ROCKLEDGE DRIVE !BETHESDA !NJ!20817!49756!067!13!MARIETTA !COBB … Key points: 1. Contract value exceeds $836 million over its 5-year period of performance. 2. Focuses on maintenance and repair of structural components for C-130 aircraft. 3. Awarded to Lockheed Martin Integrated Systems, LLC, a major defense contractor. 4. Represents a significant investment in sustaining the C-130 Hercules fleet. 5. The contract type is Firm Fixed Price, indicating defined costs for the government. 6. The duration of the contract is over 1900 days, suggesting a long-term need.
Value Assessment
Rating: good
The contract value of over $836 million for aircraft structural component repair is substantial, reflecting the operational demands of the C-130 fleet. While specific per-unit cost data is not provided, the Firm Fixed Price nature of the contract suggests a degree of cost certainty for the government. Benchmarking against similar sustainment contracts for large military aircraft would provide further insight into value for money, but the scale of this award indicates a significant and ongoing requirement.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of 10 bids suggests a competitive environment, which typically benefits the government by driving down prices and encouraging innovation. The fact that it was competed broadly is a positive sign for price discovery and ensuring the government receives competitive offers for this critical service.
Taxpayer Impact: Full and open competition for this contract likely resulted in a more favorable price for taxpayers compared to a sole-source award. It ensures that the Department of Defense explored the market to find the best value.
Public Impact
The primary beneficiaries are the U.S. Air Force and other branches operating the C-130 Hercules aircraft, ensuring fleet readiness. Services delivered include maintenance and repair of structural components, crucial for flight safety and operational capability. The geographic impact is national, supporting the operational readiness of air mobility command across various bases. Workforce implications include employment for skilled technicians and engineers involved in aircraft repair and maintenance, likely concentrated around the contractor's facilities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if unforeseen structural issues arise beyond the scope of the fixed-price agreement.
- Dependence on a single prime contractor for critical sustainment services could pose supply chain risks.
- Long contract duration may lead to vendor lock-in and reduced flexibility for future technological upgrades.
Positive Signals
- Firm Fixed Price contract structure provides cost predictability for the government.
- Full and open competition suggests a robust market engagement and potential for competitive pricing.
- Award to a major defense contractor with established expertise in aircraft sustainment.
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on aircraft sustainment and maintenance. The market for military aircraft MRO (Maintenance, Repair, and Overhaul) is substantial, driven by the need to keep aging fleets operational. Spending on sustainment is a critical component of overall defense budgets, often rivaling new procurement in dollar value. This contract represents a significant portion of spending dedicated to the C-130 platform.
Small Business Impact
While this contract was awarded to a large prime contractor, Lockheed Martin, there is no explicit indication of a small business set-aside. However, large defense contracts often involve significant subcontracting opportunities. It is probable that small businesses specializing in specific repair services or component manufacturing could be engaged as subcontractors, contributing to the broader small business ecosystem within the defense industrial base.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), ensuring compliance with contract terms and performance standards. Accountability measures are inherent in the Firm Fixed Price structure, with penalties or remedies for non-performance. Transparency is facilitated through contract databases and reporting requirements, though detailed operational performance metrics may not always be publicly disclosed.
Related Government Programs
- C-130 Hercules Sustainment Programs
- Air Mobility Command Aircraft Maintenance
- Defense Logistics Agency Aviation Support
- Aircraft Structural Repair Services
- Aerospace Component Maintenance Contracts
Risk Flags
- Long-term contract dependency
- Potential for cost escalation beyond fixed price
- Reliance on prime contractor for critical components
Tags
defense, department-of-defense, lockheed-martin, c-130-hercules, aircraft-maintenance, structural-repair, firm-fixed-price, full-and-open-competition, georgia, large-contract, sustainment, aerospace
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $36.2 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC. 200309!000302!5700!GJ40 !WARNER ROBINS ALC/LUK !F0960301D0207 !A!N! !N!0044 !20030613!20050630!836196972!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!6801 ROCKLEDGE DRIVE !BETHESDA !NJ!20817!49756!067!13!MARIETTA !COBB !GEORGIA !+000009151992!N!N!000000000000!J015!MAINT & REPAIR OF EQ/AIRCRAFT STRUCTURAL COMPS !A1A!AIRFRAMES AND SPARES !3ACD!C-130 HERCULES !336411!E! !5!B!M! !C! !99990909!B
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $36.2 million.
What is the period of performance?
Start: 2003-06-13. End: 2008-10-16.
What is the historical spending trend for C-130 Hercules structural component repair by the Department of Defense?
Historical spending on C-130 Hercules structural component repair has been substantial and consistent, reflecting the long service life of this vital aircraft. While precise figures for structural repair alone are difficult to isolate without detailed contract data, the overall sustainment costs for the C-130 fleet run into billions of dollars annually across all its variants and maintenance needs. This contract, valued at over $836 million, represents a significant portion of that ongoing investment. Trends indicate a sustained need for these services as the fleet ages, with periodic large-scale contracts awarded to manage major repair and overhaul requirements. The government often seeks to consolidate these services to achieve economies of scale, as seen with this award to a single prime contractor.
How does the pricing of this contract compare to similar aircraft sustainment contracts?
Direct comparison of pricing for this specific contract to similar aircraft sustainment contracts is challenging without access to detailed cost breakdowns and specific performance metrics. However, the Firm Fixed Price (FFP) nature of this award suggests that the government has negotiated a set price for the defined scope of work, which aids in budget predictability. The fact that it was awarded under full and open competition with 10 bidders implies a competitive pricing environment. Generally, sustainment contracts for major military platforms like the C-130 are substantial due to the complexity and criticality of the work. Benchmarking would ideally involve comparing the average cost per flight hour or per repair action for similar components across different aircraft types and service providers, considering factors like labor rates, material costs, and overhead.
What are the key performance indicators (KPIs) used to assess the contractor's performance on this contract?
Key Performance Indicators (KPIs) for a contract of this nature typically focus on ensuring the operational readiness and safety of the C-130 fleet. While specific KPIs are not publicly detailed, they commonly include metrics such as on-time delivery of repaired components, quality of repairs (measured by defect rates or rework required), turnaround time for repairs, and adherence to technical specifications and airworthiness directives. For a Firm Fixed Price contract, meeting these performance standards is crucial for the contractor to achieve profitability. The Defense Contract Management Agency (DCMA) would likely monitor these KPIs to ensure the government receives the required level of service and that the structural integrity of the aircraft is maintained.
What is Lockheed Martin's track record in providing sustainment services for the C-130 Hercules?
Lockheed Martin, as the original manufacturer of the C-130 Hercules, possesses an extensive and well-established track record in providing sustainment services for the platform. They are the primary source for original parts, technical data, and engineering support. Their experience spans decades and includes numerous contracts for maintenance, repair, upgrades, and logistics support for various C-130 variants operated by the U.S. Air Force and international customers. This deep institutional knowledge and direct lineage with the aircraft design provide them with a significant advantage in understanding and executing complex structural repair and maintenance tasks, making them a logical choice for such a critical sustainment contract.
What are the potential risks associated with the long duration and high value of this contract?
The long duration (over 1900 days) and high value (over $836 million) of this contract present several potential risks. For the government, there's the risk of vendor lock-in, where switching providers in the future could be costly and disruptive. Inflationary pressures over the contract period could erode the value of the fixed price if not adequately accounted for. Technological advancements in repair techniques or materials might emerge, but the fixed-price nature could limit the contractor's incentive to proactively adopt them unless contractually mandated. For the contractor, risks include underestimating the complexity of repairs, unforeseen material cost increases, or changes in government requirements that may not be fully covered by the FFP terms, potentially leading to reduced profit margins or disputes.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 10
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 6801 ROCKLEDGE DR, BETHESDA, MD, 08
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: F0960301D0207
IDV Type: IDC
Timeline
Start Date: 2003-06-13
Current End Date: 2008-10-16
Potential End Date: 2008-10-16 00:00:00
Last Modified: 2014-07-16
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