DoD Awards $31.4M for Stinger Warhead Bodies to Lockheed Martin, No Competition
Contract Overview
Contract Amount: $31,410,556 ($31.4M)
Contractor: Lockheed Martin Sippican, Inc.
Awarding Agency: Department of Defense
Start Date: 2014-07-31
End Date: 2022-12-31
Contract Duration: 3,075 days
Daily Burn Rate: $10.2K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: THIS DELIVERY ORDER IS FOR THE MATERIALFOR THE FUTURE PRODUCTION OF STINGER LEGACY WARHEAD BODY ASSEMBLIES
Place of Performance
Location: LIVERPOOL, ONONDAGA County, NEW YORK, 13088
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $31.4 million to LOCKHEED MARTIN SIPPICAN, INC. for work described as: THIS DELIVERY ORDER IS FOR THE MATERIALFOR THE FUTURE PRODUCTION OF STINGER LEGACY WARHEAD BODY ASSEMBLIES Key points: 1. Significant award for critical defense component. 2. Sole-source award raises questions about price discovery. 3. Long contract duration (2014-2022) suggests sustained need. 4. Ammunition manufacturing sector is vital for national security.
Value Assessment
Rating: questionable
The $31.4 million award for Stinger warhead bodies lacks a competitive benchmark. Without competition, it's difficult to assess if the price is optimal compared to potential alternatives or market rates for similar components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Lockheed Martin Sippican, Inc. This limits price discovery and may result in higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition for this significant defense contract could lead to inflated prices, impacting taxpayer value for money.
Public Impact
Ensures continued production of a key missile component. Supports a major defense contractor's operations. Potential for higher costs due to lack of competition.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- Long contract duration
Positive Signals
- Critical defense capability
- Established contractor
Sector Analysis
This award falls within the Ammunition (except Small Arms) Manufacturing sector, a critical component of the defense industrial base. Spending in this area is directly tied to national security needs and geopolitical factors.
Small Business Impact
The data indicates this contract was not awarded to small businesses (ss: false, sb: false). Therefore, there is no direct benefit to small businesses from this specific award.
Oversight & Accountability
The award was managed by the Defense Contract Management Agency (DCMA), suggesting a level of oversight. However, the sole-source nature warrants scrutiny regarding cost reasonableness and effective price negotiation.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
- Limited transparency on price justification
- Long contract duration without re-evaluation
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, ny, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $31.4 million to LOCKHEED MARTIN SIPPICAN, INC.. THIS DELIVERY ORDER IS FOR THE MATERIALFOR THE FUTURE PRODUCTION OF STINGER LEGACY WARHEAD BODY ASSEMBLIES
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN SIPPICAN, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $31.4 million.
What is the period of performance?
Start: 2014-07-31. End: 2022-12-31.
What is the justification for the sole-source award, and was a market research conducted to confirm no other capable sources existed?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. A thorough market research should have been conducted to validate the absence of other viable suppliers and to ensure the government obtained the best possible value under the circumstances.
How was the price determined to be fair and reasonable in the absence of competitive bids?
In sole-source procurements, price reasonableness is often determined through cost analysis, technical analysis, and comparison with historical pricing data for similar items or services. The contracting officer would have likely reviewed the contractor's proposed costs, profit margins, and potentially used data from previous contracts or industry benchmarks to establish a fair and reasonable price.
What is the long-term strategy for ensuring competitive sourcing for future Stinger warhead body needs?
The long-term strategy should involve proactive market research to identify potential new sources or encourage existing ones to develop capabilities. If the technology remains specialized, exploring options for technology transfer or developing alternative warhead designs that allow for broader competition could be considered to mitigate future sole-source risks.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
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 Corporation
Address: 7 BARNABAS RD, MARION, MA, 02738
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: $31,410,556
Exercised Options: $31,410,556
Current Obligation: $31,410,556
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W15QKN14D0082
IDV Type: IDC
Timeline
Start Date: 2014-07-31
Current End Date: 2022-12-31
Potential End Date: 2022-12-31 00:00:00
Last Modified: 2024-04-19
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