DoD's $175M TSSP Support contract awarded to Lockheed Martin for Aircraft Manufacturing

Contract Overview

Contract Amount: $175,153,818 ($175.2M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2006-10-01

End Date: 2007-09-30

Contract Duration: 364 days

Daily Burn Rate: $481.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS INCENTIVE

Sector: Defense

Official Description: FY07 CLIN 0001 TSSP SUPPORT

Place of Performance

Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93599

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $175.2 million to LOCKHEED MARTIN CORPORATION for work described as: FY07 CLIN 0001 TSSP SUPPORT Key points: 1. Contract value of $175M for TSSP Support services. 2. Awarded to Lockheed Martin Corporation, a major defense contractor. 3. Contract type is Cost Plus Incentive, suggesting performance-based incentives. 4. Full and Open Competition after Exclusion of Sources indicates a specific procurement approach. 5. Contract duration of 364 days aligns with typical annual support contracts. 6. The contract falls under the Aircraft Manufacturing NAICS code. 7. Award was made by the Department of the Air Force. 8. The contract was awarded as 'Other' (ST: CA), potentially indicating a unique service category.

Value Assessment

Rating: fair

The contract value of $175 million for TSSP Support is substantial. Without specific performance metrics or comparable contracts for TSSP, a precise value-for-money assessment is difficult. The Cost Plus Incentive fee structure suggests an attempt to align contractor incentives with government objectives, which can be a positive indicator if well-structured. However, cost-plus contracts can sometimes lead to higher costs than fixed-price arrangements if not closely managed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This specific procurement method implies that while the competition was intended to be broad, certain sources were excluded for defined reasons. The number of bidders is not specified, but this approach suggests a deliberate effort to ensure a competitive environment while addressing specific program requirements that might limit the pool of eligible offerors.

Taxpayer Impact: This competition type aims to achieve fair pricing by allowing multiple qualified vendors to bid, while also ensuring that only those capable of meeting specific, potentially unique, requirements participate. This can lead to better value for taxpayers by fostering innovation and efficiency among eligible bidders.

Public Impact

The primary beneficiaries are the Department of Defense and the U.S. Air Force, receiving critical TSSP Support services. The services delivered are related to Aircraft Manufacturing, likely encompassing maintenance, repair, overhaul, or specialized support for aircraft. The geographic impact is primarily within the United States, given the Department of the Air Force's operational bases. Workforce implications include employment opportunities for skilled labor within Lockheed Martin and its subcontractors in the aerospace and defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus contract types can carry a risk of cost overruns if not meticulously monitored.
The 'Exclusion of Sources' in the competition, while justified, might limit the full spectrum of competitive pricing.
Lack of detailed performance metrics makes it challenging to fully assess the 'incentive' aspect of the contract.

Positive Signals

Award to a large, established defense contractor like Lockheed Martin suggests a high likelihood of technical capability and experience.
The 'Full and Open Competition' aspect, even with exclusions, indicates an effort to achieve a competitive outcome.
The Cost Plus Incentive fee structure, if managed effectively, can drive performance improvements.

Sector Analysis

The aerospace and defense sector is characterized by large, complex contracts often involving advanced technology and long production cycles. This $175 million contract for TSSP Support, falling under Aircraft Manufacturing, is typical of the spending within this sector. Comparable spending benchmarks would involve looking at other major support contracts for military aircraft fleets, which often run into hundreds of millions of dollars annually, reflecting the high cost of maintaining advanced military assets.

Small Business Impact

The data indicates this contract was not set aside for small businesses (SS: false, SB: false). Lockheed Martin Corporation is a large prime contractor. While there is no direct information on subcontracting plans for small businesses within this specific data point, large defense contracts typically involve significant subcontracting opportunities. The extent to which small businesses will benefit depends on Lockheed Martin's subcontracting strategy and the specific requirements of the TSSP Support services.

Oversight & Accountability

Oversight for this Department of Defense contract would typically be managed by the contracting officer and program management office within the Department of the Air Force. Accountability measures are embedded in the Cost Plus Incentive fee structure, which links contractor profit to performance. Transparency is generally maintained through contract awards databases, though specific performance details and cost breakdowns may be subject to proprietary or national security restrictions. Inspector General jurisdiction would apply for investigations into fraud, waste, or abuse.

Related Government Programs

Aircraft Maintenance and Repair Services
Aerospace Defense Contracts
Military Aircraft Support Programs
Department of Defense Procurement
Cost Plus Incentive Fee Contracts

Risk Flags

Cost-Plus Contract Risk
Competition Limitations
Undefined Acronym
Lack of Performance Metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $175.2 million to LOCKHEED MARTIN CORPORATION. FY07 CLIN 0001 TSSP SUPPORT

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 $175.2 million.

What is the period of performance?

Start: 2006-10-01. End: 2007-09-30.

What is the historical spending trend for TSSP Support contracts awarded to Lockheed Martin Corporation?

Analyzing historical spending requires access to a broader dataset of past contracts. However, given Lockheed Martin's significant role in defense manufacturing and support, it is probable that they have held numerous similar contracts over the years. To assess trends, one would need to aggregate data for TSSP Support or related aircraft support services awarded to Lockheed Martin across multiple fiscal years. This would reveal whether spending has been consistent, increasing, or decreasing, and identify any patterns in contract types (e.g., cost-plus vs. fixed-price) and durations. Without this historical context, it's difficult to determine if the current $175 million award represents a typical investment or a significant deviation.

How does the per-unit cost of TSSP Support under this contract compare to industry benchmarks?

Determining a 'per-unit cost' for TSSP Support is challenging without knowing the specific units of service being procured (e.g., hours of labor, number of aircraft serviced, specific maintenance tasks). The contract type (Cost Plus Incentive) also complicates direct per-unit cost comparisons, as the final cost is variable and dependent on performance. To benchmark, one would need to identify the key performance metrics and associated costs from the contract's CLINs (Contract Line Item Numbers) and compare these to similar services provided by other defense contractors or commercial entities for comparable aircraft types. Industry reports on aerospace support services could provide average rates, but direct, apples-to-apples comparisons are often difficult due to the specialized nature of military contracts and varying service scopes.

What are the key performance indicators (KPIs) tied to the incentive fee in this Cost Plus Incentive contract?

The provided data does not specify the Key Performance Indicators (KPIs) linked to the incentive fee. In a Cost Plus Incentive (CPIF) contract, these KPIs are crucial for understanding how the government aims to motivate the contractor. Typically, KPIs might relate to factors such as on-time delivery of services, adherence to quality standards, cost savings achieved below target, or specific performance metrics related to aircraft readiness or maintenance turnaround times. The effectiveness of the incentive fee hinges on the clarity, measurability, and attainability of these KPIs, as well as the magnitude of the potential incentive or disincentive. Without knowing these specific metrics, the true value-driving potential of the incentive structure remains unclear.

What specific 'TSSP Support' services are being procured under this contract?

The acronym 'TSSP' is not universally defined within the provided data, and its specific meaning would likely be defined within the contract's Statement of Work (SOW). Based on the context of 'Aircraft Manufacturing' and the awarding agency (Department of the Air Force), TSSP Support could potentially refer to a range of services. Possibilities include Technical Support Services Program, Training Systems Support Program, or a specific platform's Total Systems Support Program. These services could encompass areas like logistics support, maintenance planning, technical data management, system upgrades, training development, or field service representative support for aircraft systems. A detailed review of the contract's SOW is necessary to ascertain the precise nature of the TSSP Support.

What does 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' mean in practice for this contract?

This procurement method signifies that the contract was initially intended for full and open competition, meaning all responsible sources were permitted to submit offers. However, specific sources were subsequently excluded based on documented justifications. These exclusions could be due to factors like proprietary data rights, unique capabilities required that only certain companies possess, or specific security requirements. While the competition was broad among eligible sources, the exclusion means not every potential vendor in the market was considered. This approach aims to balance competitive principles with the need to procure specialized services or technologies where a limited number of sources can realistically meet the requirements, potentially impacting the final price and innovation landscape.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

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, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $175,153,818

Exercised Options: $175,153,818

Current Obligation: $175,153,818

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA862706D2160

IDV Type: IDC

Timeline