DoD awards $15.8M contract to Lockheed Martin for aircraft parts, raising competition concerns

Contract Overview

Contract Amount: $15,795,853 ($15.8M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2006-01-03

End Date: 2014-10-03

Contract Duration: 3,195 days

Daily Burn Rate: $4.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200605!000086!5700!FA8212!OO-ALC/PKGF/LGKF !FA821206C0012 !A!N! !N! !PM0001!20060103!20070315!008016958!008016958!834951691!N!LOCKHEED MARTIN CORPORATION !LOCKHEED BLVD !FORT WORTH !TX!76108!27000!439!48!FORT WORTH !TARRANT !TEXAS !+000000352100!Y!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !000 !NOT DISCERNABLE !336413!E! !3! ! !C! ! !99990909!B! ! !N!Z!D!N!J!1!001!N!1G!A!N!A! ! !N!C!N! ! ! !A!A!A!A!000!A!D!N! ! ! !Y! ! !0001! !

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76108

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $15.8 million to LOCKHEED MARTIN CORPORATION for work described as: 200605!000086!5700!FA8212!OO-ALC/PKGF/LGKF !FA821206C0012 !A!N! !N! !PM0001!20060103!20070315!008016958!008016958!834951691!N!LOCKHEED MARTIN CORPORATION !LOCKHEED BLVD !FORT WORTH !TX!76108!27000!439!48!FORT WORTH !TARR… Key points: 1. The contract value is $15,795,853.23. 2. Awarded to Lockheed Martin Corporation, a major defense contractor. 3. The contract was 'NOT COMPETED', indicating a lack of competitive bidding. 4. The product service code is '336413' for Aircraft Fixed Wing manufacturing. 5. The contract duration is 3195 days.

Value Assessment

Rating: questionable

The contract value of $15.8 million for aircraft parts is substantial. Without comparable contract data for similar parts or services, it's difficult to definitively assess if this price is competitive. The lack of competition raises concerns about potential overpricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT COMPETED' basis, implying a sole-source or limited competition scenario. This significantly limits price discovery and potentially leads to higher costs for the government compared to a fully competitive process.

Taxpayer Impact: The lack of competition in this $15.8 million award may result in taxpayers paying more than necessary for aircraft parts.

Public Impact

Significant taxpayer funds allocated to a single contractor without competitive bidding. Potential for inflated costs due to lack of market competition. Impact on the broader aerospace parts manufacturing sector by limiting opportunities for other suppliers. Raises questions about the justification for not seeking competitive proposals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for cost overruns
Long contract duration
Sole-source award

Positive Signals

Award to established contractor
Specific product/service identified

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically for aircraft parts. Spending in this sector is often characterized by high R&D costs, complex supply chains, and significant government oversight due to national security implications. Benchmarks for similar sole-source aircraft parts contracts are difficult to ascertain without more specific data.

Small Business Impact

The award to Lockheed Martin Corporation, a large prime contractor, suggests that small businesses were likely not directly involved as prime recipients of this contract. Subcontracting opportunities for small businesses may exist, but are not detailed in this award notice.

Oversight & Accountability

The 'NOT COMPETED' status warrants further investigation into the justification for bypassing the standard competitive procurement process. Oversight should focus on ensuring the necessity of a sole-source award and verifying the reasonableness of the price.

Related Government Programs

Other Aircraft Parts and Auxiliary Equipment Manufacturing
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Lack of competitive bidding raises concerns about price fairness.
Potential for cost overruns due to sole-source nature.
Long contract duration (over 8 years) increases risk exposure.
Limited transparency into the justification for sole-source award.
Potential impact on small business participation as prime contractors.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.8 million to LOCKHEED MARTIN CORPORATION. 200605!000086!5700!FA8212!OO-ALC/PKGF/LGKF !FA821206C0012 !A!N! !N! !PM0001!20060103!20070315!008016958!008016958!834951691!N!LOCKHEED MARTIN CORPORATION !LOCKHEED BLVD !FORT WORTH !TX!76108!27000!439!48!FORT WORTH !TARRANT !TEXAS !+000000352100!Y!N!000000000000!1510!AIRCRAFT FIXED WING !A1A!AIRFRAMES AND SPARES !000 !NOT DISCERNABLE !336413!E! !3! ! !C! ! !999

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 $15.8 million.

What is the period of performance?

Start: 2006-01-03. End: 2014-10-03.

What was the specific justification for awarding this contract on a sole-source basis instead of seeking competitive bids?

The justification for a sole-source award typically involves factors such as unique capabilities, urgent needs, or the unavailability of alternative sources. Without access to the specific justification documentation for this contract (FA821206C0012), it is impossible to determine the precise reasons. However, such justifications are usually reviewed by contracting officers to ensure they align with federal acquisition regulations.

How does the $15.8 million price compare to market rates for similar aircraft parts, considering the lack of competition?

Directly comparing the $15.8 million price to market rates is challenging due to the 'NOT COMPETED' nature of the award. Sole-source contracts often lack the price transparency and downward pressure found in competitive bidding. To assess value, a detailed cost analysis by the government would be necessary, comparing the contractor's proposed costs against independent government estimates or historical pricing for comparable items, if available.

What measures are in place to ensure the effectiveness and quality of the aircraft parts provided under this long-term, sole-source contract?

Effectiveness and quality are typically ensured through stringent contract terms, including detailed specifications, quality assurance clauses, and performance metrics. The Department of Defense would likely have inspection and acceptance procedures at various stages of production and delivery. For a sole-source contract, robust government oversight and acceptance testing are crucial to mitigate risks associated with the absence of competitive quality benchmarking.

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

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: LOCKHEED BLVD, FORT WORTH, TX, 76108

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline