DoD awards $50.7M Lockheed Martin contract for aircraft Service Life Extension Program kits

Contract Overview

Contract Amount: $50,715,468 ($50.7M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2025-12-19

End Date: 2035-12-18

Contract Duration: 3,651 days

Daily Burn Rate: $13.9K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SERVICE LIFE EXTENSION PROGRAM (SLEP) TURKIYE, 46 SLEP KITS AND 21 SLEP KITS OPTIONS

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76108

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $50.7 million to LOCKHEED MARTIN CORPORATION for work described as: SERVICE LIFE EXTENSION PROGRAM (SLEP) TURKIYE, 46 SLEP KITS AND 21 SLEP KITS OPTIONS Key points: 1. Contract awarded to a single, large defense contractor, raising questions about competition. 2. Significant contract value for specialized engineering services related to aircraft sustainment. 3. Long contract duration suggests a critical, ongoing need for these services. 4. Fixed-price contract type aims to control costs, but initial award value is substantial. 5. Geographic focus on Texas for contract performance. 6. No indication of small business participation or set-asides.

Value Assessment

Rating: fair

The contract value of $50.7 million for Service Life Extension Program (SLEP) kits is substantial. Benchmarking this against similar contracts is difficult without more specific details on the kits and the scope of work. However, given the specialized nature of SLEP and the sole-source award to a major defense contractor, the pricing warrants scrutiny to ensure it reflects fair market value for the engineering services and kits provided. The fixed-price nature of the contract is a positive cost control measure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. This typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition limits price discovery and may result in higher costs for the government compared to a fully competed contract.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive bidding, as the government did not benefit from multiple offers driving down the price.

Public Impact

The primary beneficiaries are the U.S. Air Force, ensuring the continued operational readiness and lifespan of critical aircraft through SLEP. Services delivered include the provision of SLEP kits and associated engineering support, enhancing aircraft longevity and performance. Contract performance is located in Texas, potentially impacting the local aerospace and defense workforce. This contract supports the sustainment of military aviation assets, a crucial component of national defense.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
High contract value requires diligent oversight to ensure value for money.
Long contract duration increases exposure to potential cost overruns if not managed effectively.

Positive Signals

Fixed-price contract type provides cost certainty.
Award to a known, experienced contractor like Lockheed Martin may reduce performance risk.
Service Life Extension Programs are critical for maintaining aging aircraft fleets.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting the aerospace and defense industry. The market for aircraft sustainment and modernization, including SLEP, is dominated by a few large, established defense contractors. Spending in this area is driven by the need to maintain aging military fleets, extend their service lives, and ensure operational readiness. Comparable spending benchmarks would typically be found within other large sustainment contracts for major weapon systems.

Small Business Impact

The contract data indicates that small business participation is not a stated requirement or set-aside for this award (ss: false, sb: false). This suggests that the primary contractor, Lockheed Martin, will likely fulfill the contract requirements directly or through its own supply chain. There is no explicit provision for subcontracting to small businesses, which could limit opportunities for the small business ecosystem in this specific contract's execution.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of the Air Force, a component of the Department of Defense. Accountability measures are inherent in the fixed-price contract structure, which incentivizes the contractor to manage costs. Transparency may be limited due to the sole-source nature of the award. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Aircraft Sustainment Programs
Defense Logistics Agency Contracts
Air Force Materiel Command Contracts
Aerospace Engineering Services
Military Aircraft Modernization

Risk Flags

Sole-source award
High contract value
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $50.7 million to LOCKHEED MARTIN CORPORATION. SERVICE LIFE EXTENSION PROGRAM (SLEP) TURKIYE, 46 SLEP KITS AND 21 SLEP KITS OPTIONS

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 $50.7 million.

What is the period of performance?

Start: 2025-12-19. End: 2035-12-18.

What is the historical spending pattern for Service Life Extension Programs (SLEP) by the Department of Defense, and how does this award compare?

Historical spending on SLEP programs by the DoD can vary significantly year-to-year, depending on the specific aircraft platforms undergoing extension and the overall defense budget allocation. These programs are often multi-year and involve substantial investment to extend the operational life of aging aircraft fleets, such as the F-16, C-130, or B-52. Awards for SLEP can range from tens of millions to billions of dollars over the program's life. This $50.7 million award for SLEP kits and engineering services for the Turkish Air Force appears to be a specific, albeit significant, component of a broader sustainment strategy. Without knowing the specific aircraft type and the full scope of the Turkish SLEP program, a direct comparison to historical DoD-wide SLEP spending is challenging. However, it represents a notable investment in extending the service life of a specific aircraft asset.

What is Lockheed Martin Corporation's track record with Service Life Extension Programs (SLEP) for military aircraft?

Lockheed Martin Corporation has an extensive and well-established track record with Service Life Extension Programs (SLEP) for various military aircraft platforms. As a prime contractor for numerous fighter jets, transport aircraft, and other military aviation systems, they possess deep expertise in the engineering, manufacturing, and integration required for SLEP. Examples include SLEP work on F-16 fighter jets, C-130 transport aircraft, and potentially other platforms operated by the U.S. Air Force and allied nations. Their long history in defense manufacturing provides them with the necessary technical knowledge, specialized facilities, and supply chain access to execute complex SLEP contracts effectively. This experience suggests a lower performance risk associated with their ability to deliver the required SLEP kits and services.

How does the 'Not Available for Competition' (CT: NOT AVAILABLE FOR COMPETITION) designation impact the value proposition for taxpayers on this $50.7M contract?

The 'Not Available for Competition' designation, often synonymous with sole-source procurement, significantly impacts the value proposition for taxpayers. When a contract is not competed, the government foregoes the benefits of competitive bidding, which typically drives down prices and encourages innovation among multiple bidders. In this case, Lockheed Martin is the sole provider, meaning the government cannot leverage offers from other qualified companies to negotiate a lower price. While the contract is fixed-price, which offers some cost certainty, the absence of competition means taxpayers may be paying a higher price than if multiple vendors had vied for the contract. This necessitates robust government oversight to ensure the awarded price is fair and reasonable, even without competitive benchmarks.

What are the potential risks associated with a long-duration contract (over 10 years) for engineering services and kits?

Long-duration contracts, such as this 10-year agreement, present several potential risks. Firstly, there's the risk of cost escalation over time, even with a fixed-price contract, if unforeseen technical challenges arise or if initial cost estimates were inaccurate. Secondly, technological obsolescence is a concern; the technology or requirements might evolve significantly during the contract period, potentially making the delivered kits or services less relevant or requiring costly modifications. Thirdly, contractor performance risk can increase over extended periods; maintaining consistent quality and responsiveness from the contractor over a decade requires diligent program management. Finally, changes in government priorities or budget constraints could lead to contract modifications, terminations, or reduced scope, impacting the intended benefits of the SLEP program.

What is the significance of the PSC code (if available) and NAICS code (541330) in understanding this contract's scope?

The NAICS code 541330, 'Engineering Services,' indicates that the primary nature of this contract involves professional engineering expertise. This encompasses a wide range of activities, including design, consultation, analysis, and project management related to engineering projects. For this specific contract, it suggests that beyond the physical SLEP kits, significant engineering support, analysis, and potentially design modifications or integration services are being procured. The PSC (Product or Service Code) is not provided in the abbreviated data, but if it were, it would offer more granular detail on the specific type of engineering service or defense-related product being acquired. Together, these codes help categorize the contract within the broader federal procurement landscape, highlighting its focus on specialized technical services within the defense sector.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

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: 1 LOCKHEED BLVD, 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: $50,715,468

Exercised Options: $50,715,468

Current Obligation: $50,715,468

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline