DoD Awards $6.1B for Missile Defense R&D to Lockheed Martin, Raising Oversight Concerns
Contract Overview
Contract Amount: $6,100,118,932 ($6.1B)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2000-06-28
End Date: 2014-11-03
Contract Duration: 5,241 days
Daily Burn Rate: $1.2M/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: 200009!2100!001246!SG60 !USA SPACE AND STRATEGIC DEF CDR !DASG6000C0072 !A!*!0 !20000628!20080503!188160782!834951691!834951691!N!23917!LOCKHEED MARTIN CORPORATION !1111 LOCKHEED MARTIN WAY, !SUNNYVALE !CA!94089!77000!085!06!SUNNYVALE !SANTA CLARA !CALIFORNIA!0001!+000077527000!N!N!000000000000!AC23!RDTE/MISSILE AND SPACE SYSTEMS-ADV TECH DEV !A2 !MISSILE AND SPACE SYSTEMS !1CNX!THAAD-THEATER HIGH ALT AIR DEF!8731!1!*!*!*!B!A!*!C !N!R!1!001!N!1B!A!Y!Z!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!
Place of Performance
Location: SUNNYVALE, SANTA CLARA County, CALIFORNIA, 94088
Plain-Language Summary
Department of Defense obligated $6.10 billion to LOCKHEED MARTIN CORP for work described as: 200009!2100!001246!SG60 !USA SPACE AND STRATEGIC DEF CDR !DASG6000C0072 !A!*!0 !20000628!20080503!188160782!834951691!834951691!N!23917!LOCKHEED MARTIN CORPORATION !1111 LOCKHEED MARTIN WAY, !SUNNYVALE !CA!94089!77000!085!06!SUNNYVALE !SAN… Key points: 1. Significant investment in advanced missile defense technology. 2. Sole-source award to Lockheed Martin raises competition questions. 3. Long contract duration and cost-plus structure may increase risk. 4. Sector focus on R&D for strategic defense systems.
Value Assessment
Rating: questionable
The contract value of $6.1 billion is substantial for R&D. Without competitive bidding, it's difficult to benchmark pricing against similar contracts, making value assessment challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This was a sole-source award, meaning no competition was sought. This limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition for a contract of this magnitude could result in suboptimal pricing and reduced taxpayer value.
Public Impact
Impacts national security through advanced defense capabilities. Potential for technological advancements in missile defense. Taxpayer funds allocated to a single contractor for critical R&D.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Long contract duration
- Lack of competition
Positive Signals
- Supports critical defense R&D
- Potential for technological innovation
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on missile and space systems. The spending benchmark for similar advanced R&D contracts can vary widely, but large sole-source awards warrant scrutiny.
Small Business Impact
The contract was not awarded to a small business. There is no indication of subcontracting opportunities for small businesses within the provided data.
Oversight & Accountability
The sole-source nature of this large contract raises questions about the oversight applied to ensure fair pricing and effective execution. Further review of performance metrics and cost controls is recommended.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- Department of Defense Contracting
- Missile Defense Agency Programs
Risk Flags
- Sole-source award lacks competition
- Cost-plus contract type can lead to cost overruns
- Long contract duration increases risk exposure
- Limited transparency on justification for sole-sourcing
- Potential for contractor to prioritize fee over cost efficiency
Tags
research-and-development-in-the-physical, department-of-defense, ca, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $6.10 billion to LOCKHEED MARTIN CORP. 200009!2100!001246!SG60 !USA SPACE AND STRATEGIC DEF CDR !DASG6000C0072 !A!*!0 !20000628!20080503!188160782!834951691!834951691!N!23917!LOCKHEED MARTIN CORPORATION !1111 LOCKHEED MARTIN WAY, !SUNNYVALE !CA!94089!77000!085!06!SUNNYVALE !SANTA CLARA !CALIFORNIA!0001!+000077527000!N!N!000000000000!AC23!RDTE/MISSILE AND SPACE SYSTEMS-ADV TECH DEV !A2 !MISSILE AND SPACE SYSTEMS !1CNX!THAAD-THEATER HIGH ALT AIR DEF!8731!1!*!*!*!B!A!*!C !N!R!
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Missile Defense Agency).
What is the total obligated amount?
The obligated amount is $6.10 billion.
What is the period of performance?
Start: 2000-06-28. End: 2014-11-03.
What specific justification was provided for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without specific documentation, it's difficult to assess if alternative competitive strategies were thoroughly explored. This lack of transparency can hinder accountability and potentially lead to less favorable pricing for the government.
How are cost overruns managed under this Cost Plus Award Fee (CPAF) contract, and what are the incentives for the contractor to control costs?
CPAF contracts allow for reimbursement of costs plus a fee that is based on performance. Incentives for cost control are tied to achieving specific performance targets. However, the 'cost-plus' nature inherently carries a risk of cost growth, and robust oversight is crucial to ensure the contractor is motivated to manage expenses effectively and avoid unnecessary expenditures.
What are the key performance indicators (KPIs) for this R&D contract, and how is the effectiveness of the technological advancements being measured?
Effectiveness in R&D contracts is measured by milestones, prototypes, and successful testing of new technologies. KPIs would likely include meeting technical objectives, adhering to development schedules, and demonstrating the feasibility of advanced missile defense concepts. The government must have clear metrics to assess whether the significant investment is yielding the desired strategic capabilities.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 1111 LOCKHEED MARTIN WAY BLDG 157, SUNNYVALE, CA, 94089
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2000-06-28
Current End Date: 2014-11-03
Potential End Date: 2014-11-03 00:00:00
Last Modified: 2021-07-29
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