DoD Awards $619M for Aircraft Fixed Wing Components to Lockheed Martin
Contract Overview
Contract Amount: $224,971,941 ($225.0M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2005-10-03
End Date: 2006-09-30
Contract Duration: 362 days
Daily Burn Rate: $621.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE
Sector: Defense
Official Description: 200605!000005!5700!FA8627!ASC/YNK !F3365798D0117 !A!N! !N!0050 ! !20051003!20060930!619434590!619434590!834951691!N!LOCKHEED MARTIN CORPORATION !1011 LOCKHEED WAY !PALMDALE !CA!93599!55156!037!06!PALMDALE !LOS ANGELES !CALIFORNIA!+000093125177!N!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !000 !NOT DISCERNABLE !336411!E! !5!A!S! ! ! !99990909!B! ! !A! !D!N!V!1!001!N!1A!A!Y!Z! ! !N!C!N! ! ! !Z!Z!A!A!000!A!C!N! ! ! !Y! ! !0001! !
Place of Performance
Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93599
Plain-Language Summary
Department of Defense obligated $225.0 million to LOCKHEED MARTIN CORPORATION for work described as: 200605!000005!5700!FA8627!ASC/YNK !F3365798D0117 !A!N! !N!0050 ! !20051003!20060930!619434590!619434590!834951691!N!LOCKHEED MARTIN CORPORATION !1011 LOCKHEED WAY !PALMDALE !CA!93599!55156!037!06!PALMDALE !LOS … Key points: 1. Significant contract value of $619.4M awarded to a single, large defense contractor. 2. The contract is for aircraft fixed wing components, a critical part of defense aviation. 3. Awarded on a sole-source basis, raising questions about price discovery and competition. 4. The sector is dominated by a few large players, limiting competitive opportunities.
Value Assessment
Rating: questionable
The contract value of $619.4M for aircraft fixed wing components is substantial. Without specific unit cost data or benchmarks for similar components, it's difficult to definitively assess pricing. However, the sole-source nature raises concerns about potential overpricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating a lack of competition. This method limits the government's ability to explore alternative pricing and potentially secure better value through a competitive bidding process.
Taxpayer Impact: The absence of competition in this sole-source award may lead to higher costs for taxpayers compared to what might be achieved through a competitive procurement.
Public Impact
Taxpayers may be paying a premium due to the lack of competitive bidding. The contract supports critical defense aviation infrastructure, ensuring operational readiness. This award reinforces the market position of a major defense contractor. Potential for future sole-source awards in this specialized sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition
- Lack of transparency in pricing
- Potential for cost overruns without competitive pressure
Positive Signals
- Supports critical defense needs
- Award to established contractor with proven capabilities
Sector Analysis
This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft components. Spending in this sector is often characterized by high R&D costs, long production cycles, and significant government reliance on a few prime contractors.
Small Business Impact
This contract was awarded to Lockheed Martin Corporation, a large prime contractor. There is no indication of subcontracting opportunities for small businesses within the provided data, suggesting limited direct impact on the small business sector for this specific award.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential waste. Robust auditing and performance monitoring are crucial to hold the contractor accountable for delivering value.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award
- Lack of competitive bidding
- Potential for inflated pricing
- Limited transparency on cost breakdown
- Cost-plus contract type can lead to price variability
Tags
search-detection-navigation-guidance-aer, department-of-defense, ca, do, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $225.0 million to LOCKHEED MARTIN CORPORATION. 200605!000005!5700!FA8627!ASC/YNK !F3365798D0117 !A!N! !N!0050 ! !20051003!20060930!619434590!619434590!834951691!N!LOCKHEED MARTIN CORPORATION !1011 LOCKHEED WAY !PALMDALE !CA!93599!55156!037!06!PALMDALE !LOS ANGELES !CALIFORNIA!+000093125177!N!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !000 !NOT DISCERNABLE !336411!E! !5!A!S! ! ! !999
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $225.0 million.
What is the period of performance?
Start: 2005-10-03. End: 2006-09-30.
What is the specific breakdown of components being procured and their individual cost drivers?
The provided data identifies the product as 'AIRCRAFT FIXED WING AIRFRAMES AND SPARES' but lacks a granular breakdown of specific components or their associated costs. Understanding the cost drivers for individual parts would be essential for a thorough value assessment and to identify potential areas for cost savings or negotiation in future procurements.
What justification was provided for the sole-source award, and were alternatives considered?
The data indicates the contract was 'NOT COMPETED'. A formal justification for this sole-source determination, such as unique capabilities or urgent need, would typically be required. Understanding the rationale behind bypassing full and open competition is crucial for assessing the necessity and potential risks associated with this procurement approach.
How does the contract's cost-plus incentive structure impact final pricing and contractor performance?
The contract type is 'COST PLUS INCENTIVE' (pt). This structure aims to incentivize the contractor to control costs while meeting performance targets. However, it also means the final price can fluctuate based on actual costs incurred and the achievement of specific incentives, requiring careful monitoring to ensure cost efficiency and taxpayer value.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 1011 LOCKHEED WAY, PALMDALE, CA, 27
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: F3365798D0117
IDV Type: IDC
Timeline
Start Date: 2005-10-03
Current End Date: 2006-09-30
Potential End Date: 2006-09-30 00:00:00
Last Modified: 2014-12-01
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