DoD Awards $283M Sole-Source Contract for Aircraft Parts to Lockheed Martin
Contract Overview
Contract Amount: $283,360,297 ($283.4M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2023-07-03
End Date: 2029-09-04
Contract Duration: 2,255 days
Daily Burn Rate: $125.7K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: FY23 SPARES DELIVERY ORDER
Place of Performance
Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22202
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $283.4 million to LOCKHEED MARTIN CORPORATION for work described as: FY23 SPARES DELIVERY ORDER Key points: 1. Significant contract value of $283.4 million. 2. Sole-source award to Lockheed Martin Corporation indicates limited competition. 3. Potential risk associated with single-vendor reliance for critical aircraft parts. 4. Spending falls under the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector.
Value Assessment
Rating: questionable
The contract's value is substantial, but without competitive bidding, it's difficult to assess if the pricing is optimal compared to market alternatives. The firm fixed-price structure provides cost certainty but doesn't inherently guarantee value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, meaning Lockheed Martin was the only source considered. This lack of competition limits price discovery and may result in higher costs for taxpayers.
Taxpayer Impact: The absence of competition for a large contract raises concerns about potential overspending and inefficient use of taxpayer funds.
Public Impact
Ensures continued availability of critical aircraft parts for the Navy. Potential for higher costs due to lack of competitive bidding. Impacts the broader aerospace manufacturing sector by consolidating a large contract.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration (2029)
Positive Signals
- Firm fixed-price contract
- Ensures supply chain continuity
Sector Analysis
This contract falls within the 'Other Aircraft Parts and Auxiliary Equipment Manufacturing' sector, which is crucial for defense readiness. Spending benchmarks for this specific sub-sector are not readily available, but large sole-source awards warrant scrutiny.
Small Business Impact
The awardee is Lockheed Martin Corporation, a large business. There is no indication that small businesses were involved in this specific delivery order, either as prime contractors or subcontractors.
Oversight & Accountability
The sole-source nature of this award suggests a potential gap in competitive sourcing strategies. Further oversight is needed to understand why this contract was not competed and to ensure future procurements maximize competition.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award
- Lack of competition
- Potential for price inflation
- Vendor lock-in
- Long-term dependency on a single supplier
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, va, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $283.4 million to LOCKHEED MARTIN CORPORATION. FY23 SPARES DELIVERY ORDER
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 Navy).
What is the total obligated amount?
The obligated amount is $283.4 million.
What is the period of performance?
Start: 2023-07-03. End: 2029-09-04.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. Without specific documentation, it's presumed the Department of the Navy determined Lockheed Martin was the only viable option for these specific aircraft parts, potentially due to specialized manufacturing processes or existing system integration.
What are the potential risks associated with this sole-source contract for aircraft parts?
The primary risks include inflated pricing due to the lack of competition, potential for vendor lock-in, and reduced incentive for the contractor to innovate or improve efficiency. If Lockheed Martin faces production issues, the Navy's operational readiness could be impacted due to the sole reliance on this single supplier for critical components.
How does this contract contribute to the overall value for taxpayer money?
The value for taxpayer money is questionable given the sole-source nature. While it ensures the supply of necessary parts, the absence of competition makes it difficult to ascertain if the price paid is the best achievable. A competitive process would likely have yielded a lower price or better terms, thus enhancing taxpayer value.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp
Address: 1 LOCKHEED BLVD BLDG 10, FORT WORTH, TX, 76108
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $283,360,297
Exercised Options: $283,360,297
Current Obligation: $283,360,297
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0001921D0001
IDV Type: IDC
Timeline
Start Date: 2023-07-03
Current End Date: 2029-09-04
Potential End Date: 2029-09-04 00:00:00
Last Modified: 2025-03-12
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