Lockheed Martin awarded $47.7M for Sniper Targeting Pods, a sole-source contract with a 4-year duration

Contract Overview

Contract Amount: $47,708,607 ($47.7M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2009-02-27

End Date: 2013-06-20

Contract Duration: 1,574 days

Daily Burn Rate: $30.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SNIPER TARGETING PODS

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $47.7 million to LOCKHEED MARTIN CORPORATION for work described as: SNIPER TARGETING PODS Key points: 1. The contract value of $47.7 million for Sniper Targeting Pods represents a significant investment in advanced military optics. 2. Competition dynamics are absent due to a sole-source award, potentially impacting price negotiation. 3. Risk indicators include reliance on a single supplier and the long duration of the contract. 4. Performance context is tied to the Air Force's operational needs for precision targeting capabilities. 5. Sector positioning places this contract within the defense manufacturing industry, specifically targeting systems.

Value Assessment

Rating: fair

Benchmarking the value of this sole-source contract is challenging without competitive bids. The $47.7 million award over approximately four years suggests a substantial per-unit cost, but direct comparisons to similar systems procured competitively are not readily available. The absence of competition limits the ability to assess if the pricing reflects optimal value for taxpayers. Further analysis would require access to internal cost data or comparable sole-source procurements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Lockheed Martin Corporation, was considered. This approach bypasses the standard competitive bidding process. While sole-source awards can be justified for unique capabilities or urgent needs, they limit price discovery and potentially lead to higher costs compared to a fully competed contract. The lack of multiple bidders means there was no direct pressure to offer the most competitive price.

Taxpayer Impact: For taxpayers, a sole-source award means less assurance of obtaining the best possible price. Without competition, there's a reduced incentive for the contractor to minimize costs, potentially leading to a higher expenditure of public funds for the same capability.

Public Impact

The primary beneficiaries are the U.S. Air Force and its operational units requiring advanced targeting capabilities. The services delivered include the provision and potential sustainment of Sniper Targeting Pods, enhancing aircraft lethality and intelligence gathering. The geographic impact is primarily within military operational theaters where these pods are deployed. Workforce implications are concentrated within Lockheed Martin's defense manufacturing facilities, supporting specialized engineering and production roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential cost savings.
Long contract duration may not adapt to rapidly evolving technological needs.
Reliance on a single supplier creates potential supply chain vulnerabilities.

Positive Signals

Sniper Targeting Pods are a proven, advanced technology for precision strikes.
Lockheed Martin is a well-established defense contractor with extensive experience.
The contract supports critical national defense capabilities.

Sector Analysis

This contract falls within the defense electronics and aerospace manufacturing sector, a significant segment of the U.S. industrial base. The market for advanced targeting pods is characterized by high technological barriers to entry and a limited number of specialized suppliers. Spending in this area is driven by military modernization efforts and the demand for enhanced situational awareness and precision strike capabilities. Comparable spending benchmarks would involve other advanced sensor and targeting systems procured by the Department of Defense.

Small Business Impact

This contract does not appear to involve a small business set-aside. As a sole-source award to a large prime contractor, the direct impact on small businesses is likely limited to subcontracting opportunities. The extent to which Lockheed Martin will engage small businesses as subcontractors for this specific contract is not detailed in the provided data, but it is a common practice in defense contracting.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management offices. Accountability measures are inherent in the contract terms, including delivery schedules and performance specifications. Transparency is limited due to the sole-source nature, but contract awards are generally reported. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse.

Related Government Programs

Advanced Targeting Pods
Defense Electronics Manufacturing
Air Force Procurement
Lockheed Martin Defense Contracts

Risk Flags

Sole-source award may limit cost-effectiveness.
Potential for long-term sustainment costs and obsolescence.
Reliance on a single supplier for critical technology.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $47.7 million to LOCKHEED MARTIN CORPORATION. SNIPER TARGETING PODS

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 $47.7 million.

What is the period of performance?

Start: 2009-02-27. End: 2013-06-20.

What is the historical spending trend for Sniper Targeting Pods or similar systems by the Department of Defense?

Analyzing historical spending for Sniper Targeting Pods or comparable systems reveals a consistent investment by the Department of Defense in advanced targeting technology. While specific figures for this sole-source contract are provided, broader trends indicate that the DoD prioritizes such capabilities to maintain air superiority and precision strike effectiveness. Over the past decade, there has been a sustained demand for systems that offer enhanced resolution, longer standoff ranges, and improved target identification. This demand is driven by evolving threat landscapes and the need for multi-role aircraft to perform diverse missions. The procurement of targeting pods is often part of larger platform modernization programs or specific operational requirements, leading to fluctuating but generally significant annual expenditures in this category. Without access to detailed historical contract databases for this specific system, it's difficult to provide exact year-over-year figures, but the overall trend points to ongoing investment in this critical defense technology.

How does the per-unit cost of these Sniper Targeting Pods compare to other similar systems procured competitively?

Directly comparing the per-unit cost of these Sniper Targeting Pods to competitively procured systems is challenging due to the sole-source nature of this award and the proprietary nature of cost data. However, general industry knowledge suggests that sole-source contracts often result in higher per-unit costs compared to those awarded through full and open competition. Competitive bidding incentivizes contractors to optimize their pricing to win the contract, leading to potential cost savings for the government. For targeting pods, factors influencing cost include sensor technology, integration complexity, software development, and sustainment packages. If comparable systems were procured competitively, one might expect a price variance of 10-30% or more, depending on the specific technologies and market conditions. Without specific data points for comparable competitive contracts, this remains an estimation based on procurement best practices.

What are the key performance metrics and success criteria for the Sniper Targeting Pod system under this contract?

The key performance metrics and success criteria for the Sniper Targeting Pod system under this contract are primarily centered around its ability to accurately detect, identify, and track targets at extended ranges, day or night, and in various weather conditions. Specific criteria likely include target resolution capabilities, accuracy in weapon delivery guidance, reliability and mean time between failures (MTBF), and the system's ability to integrate seamlessly with various Air Force platforms. The contract would stipulate requirements for operational availability and the successful execution of missions requiring precision engagement. Success is measured by the system's contribution to mission accomplishment, minimizing collateral damage, and providing crucial intelligence, surveillance, and reconnaissance (ISR) data. The contractor's adherence to delivery schedules and technical specifications also forms a critical part of the success evaluation.

What is Lockheed Martin's track record with producing and delivering advanced targeting pods?

Lockheed Martin has a well-established and extensive track record in the development, production, and sustainment of advanced targeting pods. The Sniper Advanced Targeting Pod itself is a testament to their capabilities, having been deployed successfully on numerous U.S. Air Force and allied aircraft for many years. The company has consistently delivered sophisticated electro-optical/infrared (EO/IR) sensor systems that meet stringent military requirements for performance, reliability, and integration. Their experience spans multiple generations of targeting technology, including advancements in sensor resolution, data linking, and multi-target tracking. Lockheed Martin's long history in defense contracting, particularly in avionics and sensor systems, positions them as a leading provider in this specialized field. Their ability to secure and execute contracts like this one underscores their proven performance and technological expertise in delivering critical defense capabilities.

Are there any known risks associated with the long-term sustainment or obsolescence of the Sniper Targeting Pod system?

Yes, there are potential risks associated with the long-term sustainment and obsolescence of the Sniper Targeting Pod system, as with any advanced technology operating over extended periods. Key risks include the availability of spare parts and specialized maintenance expertise as components age or become obsolete. The rapid pace of technological advancement in sensor technology could also render the current system less effective against future threats or make upgrades prohibitively expensive. Furthermore, reliance on a sole-source provider for sustainment can lead to increased costs and potential vulnerabilities if the contractor's business strategy or capabilities change. Proactive obsolescence management, including technology refresh plans and robust sustainment strategies, is crucial to mitigate these risks and ensure the system remains viable and effective throughout its intended lifecycle.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

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 (UEI: 834951691)

Address: 5600 W SAND LAKE RD MP125, ORLANDO, FL, 90

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

Financial Breakdown

Contract Ceiling: $47,708,607

Exercised Options: $47,708,607

Current Obligation: $47,708,607

Contract Characteristics

Cost or Pricing Data: YES

Timeline