DoD Awards $1.31B Lockheed Martin Contract for Advanced Systems (MSPA) with No Competition

Contract Overview

Contract Amount: $13,121,558 ($13.1M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2024-03-01

End Date: 2027-02-28

Contract Duration: 1,094 days

Daily Burn Rate: $12.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ADVANCED SYSTEMS - MSPA

Place of Performance

Location: WASHINGTON NAVY YARD, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20374

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $13.1 million to LOCKHEED MARTIN CORPORATION for work described as: ADVANCED SYSTEMS - MSPA Key points: 1. Significant contract value of $1.31 billion awarded to a single large defense contractor. 2. Lack of competition raises concerns about potential overpricing and limited innovation. 3. The contract is for engineering services, a critical but often complex area for cost assessment. 4. Focus on 'Advanced Systems' suggests a need for specialized expertise, potentially justifying limited competition.

Value Assessment

Rating: questionable

The contract type is Cost Plus Fixed Fee (CPFF), which can lead to cost overruns if not closely monitored. Without competitive benchmarks, assessing the fairness of the fixed fee and overall pricing is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating no competitive bidding process. This significantly limits price discovery and may result in higher costs for the government compared to a competitive procurement.

Taxpayer Impact: The absence of competition means taxpayers may be paying a premium for these advanced engineering services, as the government lacks leverage to negotiate the lowest possible price.

Public Impact

Taxpayers may be footing a higher bill due to the lack of competitive pressure. The Department of the Navy is relying on a single provider for critical advanced systems engineering. Potential for reduced innovation if alternative solutions are not explored through competition. Long-term implications for defense readiness if costs escalate significantly.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Positive Signals

Sector Analysis

The defense sector, particularly for advanced systems, often involves complex engineering and specialized knowledge. While high contract values are common, the lack of competition in this $1.31 billion award warrants scrutiny against industry benchmarks for similar sole-source engineering services.

Small Business Impact

This contract was awarded to Lockheed Martin Corporation, a large prime contractor, and there is no indication of small business participation. The sole-source nature further limits opportunities for small businesses to compete for these services.

Oversight & Accountability

The sole-source award requires robust oversight from the Department of Defense to ensure costs are reasonable and performance meets expectations. Clear performance metrics and regular audits are crucial for accountability on this CPFF contract.

Related Government Programs

Risk Flags

Tags

engineering-services, department-of-defense, dc, definitive-contract, 10m-plus

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.1 million to LOCKHEED MARTIN CORPORATION. ADVANCED SYSTEMS - MSPA

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 $13.1 million.

What is the period of performance?

Start: 2024-03-01. End: 2027-02-28.

What specific justification was provided for the sole-source award, and were alternative acquisition strategies considered to foster competition?

The justification for a sole-source award typically centers on unique capabilities, proprietary technology, or urgent needs that only one source can fulfill. However, without detailed documentation, it's difficult to assess if alternative strategies, such as phased competitions or market research for potential competitors, were adequately explored to ensure the best value for the government.

How will the Department of Defense ensure cost control and prevent potential overruns under this Cost Plus Fixed Fee contract without competitive pressure?

Effective cost control will rely heavily on stringent government oversight, detailed cost tracking, and rigorous auditing of Lockheed Martin's expenditures. The fixed fee component needs careful negotiation and monitoring to ensure it reflects a fair profit margin for the work performed, rather than incentivizing cost escalation.

What are the key performance indicators (KPIs) for this contract, and how will their achievement be measured to ensure the effectiveness of the advanced systems developed?

Key performance indicators should be clearly defined and measurable, focusing on technical performance, schedule adherence, and system reliability. The government must establish robust testing and validation processes to independently verify that the advanced systems meet all specified requirements and deliver the intended operational capabilities effectively.

Industry Classification

NAICS: Professional, Scientific, and Technical ServicesArchitectural, Engineering, and Related ServicesEngineering Services

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS.TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0003024R2006

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1102 JOHN GLENN BLVD, TITUSVILLE, FL, 32780

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: $19,455,522

Exercised Options: $13,121,558

Current Obligation: $13,121,558

Subaward Activity

Number of Subawards: 8

Total Subaward Amount: $2,070,909

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline

Start Date: 2024-03-01

Current End Date: 2027-02-28

Potential End Date: 2027-02-28 00:00:00

Last Modified: 2026-03-10

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