Lockheed Martin's $29.1M Sniper Targeting Pod contract awarded by the Air Force shows limited competition

Contract Overview

Contract Amount: $29,173,893 ($29.2M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2009-07-31

End Date: 2017-10-21

Contract Duration: 3,004 days

Daily Burn Rate: $9.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SNIPER TARGETING POD

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $29.2 million to LOCKHEED MARTIN CORPORATION for work described as: SNIPER TARGETING POD Key points: 1. The contract was awarded as 'NOT AVAILABLE FOR COMPETITION', indicating a lack of competitive bidding. 2. The firm-fixed-price contract type suggests predictable costs for the government. 3. The duration of the contract (3004 days) is substantial, implying a long-term need for the service. 4. The award was made to a single bidder, raising questions about potential price overruns. 5. The contract falls under the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' NAICS code. 6. The contract was awarded to Lockheed Martin Corporation, a major defense contractor. 7. The contract was awarded to the Department of the Air Force, a branch of the Department of Defense. 8. The contract was awarded in Florida, indicating a specific geographic focus for delivery or performance.

Value Assessment

Rating: questionable

Benchmarking the value of this specific contract is challenging due to the limited competition and lack of publicly available comparable contract data. The firm-fixed-price structure is generally favorable for cost control. However, without competitive bids, it's difficult to ascertain if the pricing reflects true market value or if taxpayers received the best possible price. The substantial duration suggests a long-term commitment, making initial pricing assessment critical.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a 'NOT AVAILABLE FOR COMPETITION' designation, meaning it was not openly competed. This typically occurs when a specific technology or capability is only available from a single source, or in cases of urgent need where competition is impractical. The lack of multiple bidders means there was no direct price comparison or negotiation leverage derived from a competitive process.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as the government may not benefit from the price reductions typically achieved through competitive bidding. This limits the government's ability to ensure it is obtaining the most cost-effective solution.

Public Impact

The primary beneficiaries are the U.S. Air Force personnel who will utilize the sniper targeting pods for enhanced situational awareness and precision targeting. The services delivered include the provision of advanced targeting systems essential for modern air combat and reconnaissance missions. The contract's performance is geographically focused in Florida, suggesting potential implications for local defense industry employment and infrastructure. The contract supports the defense industrial base, particularly within the aerospace and defense manufacturing sector, potentially sustaining specialized jobs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in higher costs for taxpayers.
Sole-source award raises concerns about the government securing the best possible price.
Long contract duration could lead to cost escalation if not managed effectively.
Limited transparency due to non-competitive nature makes independent value assessment difficult.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to a major defense contractor like Lockheed Martin suggests access to established technology and expertise.
The contract addresses a critical capability for the Air Force's operational effectiveness.

Sector Analysis

The defense electronics and avionics sector is characterized by high research and development costs, long product lifecycles, and significant government procurement. Contracts for advanced targeting systems like the Sniper Pod are crucial for maintaining air superiority. The market is dominated by a few large prime contractors, with specialized components often sourced from a complex supply chain. Spending in this area is driven by evolving military requirements and technological advancements.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business subcontracting) is also false. This suggests that small businesses are unlikely to be directly involved as prime contractors or through mandatory subcontracting requirements on this specific award. The primary contractor, Lockheed Martin, would typically manage its own supply chain, which may or may not include small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and procurement regulations, managed by the Department of the Air Force. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to deliver the specified goods or services for an agreed-upon price. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Advanced Targeting Pods
Air Force Avionics Systems
Defense Procurement
Lockheed Martin Defense Contracts
Precision Guided Munitions Support Systems

Risk Flags

Sole-source award limits price competition.
Lack of transparency in pricing due to non-competitive nature.
Potential for cost overruns in long-term, non-competed contracts.
Dependence on a single contractor for critical technology.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.2 million to LOCKHEED MARTIN CORPORATION. SNIPER TARGETING POD

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 $29.2 million.

What is the period of performance?

Start: 2009-07-31. End: 2017-10-21.

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

Analyzing the historical spending trend for Sniper Targeting Pods requires accessing detailed procurement data over multiple fiscal years. While this specific contract award is for approximately $29.17 million and spans from 2009 to 2017, it represents a single award. To understand the broader trend, one would need to aggregate all awards for this system, including any modifications, sustainment contracts, or procurements by different branches of the military. Generally, advanced targeting systems see consistent investment due to their critical role in modern warfare. However, the 'NOT AVAILABLE FOR COMPETITION' status for this particular award suggests that competitive procurements might be infrequent or that this represents a specific, non-competitive acquisition phase. A comprehensive trend analysis would reveal if spending has increased, decreased, or remained stable, and whether competition levels have varied over time.

How does the cost per unit of the Sniper Targeting Pod compare to similar systems from other manufacturers?

Directly comparing the cost per unit for the Sniper Targeting Pod is difficult without specific unit pricing data from this contract and comparable data from other systems. The total award amount of $29.17 million over a period of approximately 8 years (3004 days) does not easily translate to a per-unit cost without knowing the number of units procured. Furthermore, 'NOT AVAILABLE FOR COMPETITION' awards often lack the transparent pricing benchmarks found in competitive bids. To perform a robust comparison, one would need to identify the number of pods acquired under this contract and then research the unit costs of similar targeting pods (e.g., from Raytheon or BAE Systems) procured through competitive means by the U.S. military or allied nations. Factors like technological sophistication, sensor capabilities, and integration complexity significantly influence unit pricing, making direct apples-to-apples comparisons challenging.

What are the key performance indicators (KPIs) used to evaluate the effectiveness of the Sniper Targeting Pod?

The effectiveness of the Sniper Targeting Pod is typically evaluated through a combination of technical performance metrics and operational mission outcomes. Key performance indicators (KPIs) would likely include metrics related to the pod's targeting accuracy (e.g., circular error probable - CEP), range, sensor resolution (day and night), image stability, data link reliability, and system uptime. Operationally, KPIs might assess its contribution to mission success rates, reduction in collateral damage, time-on-target, and pilot workload reduction. The Air Force, as the procuring agency, would establish these KPIs in the contract's performance work statement (PWS). While specific KPIs for this contract are not detailed in the provided data, the system's overall success is often measured by its ability to provide precise targeting information in complex environments, thereby enhancing the effectiveness and safety of air operations.

What is Lockheed Martin's track record with sole-source defense contracts of this magnitude?

Lockheed Martin Corporation, as one of the largest defense contractors globally, has a significant history of receiving sole-source contracts, particularly for advanced and specialized defense systems where they may hold proprietary technology or be the sole qualified provider. Contracts of this magnitude (approximately $29 million) are common within their portfolio, especially for complex systems like targeting pods, aircraft components, or missile systems. Their track record generally involves extensive experience in navigating the defense procurement process, including justifications for sole-source awards. While sole-source awards can raise concerns about price competitiveness, they are often deemed necessary for critical capabilities or when competition is not feasible. Evaluating Lockheed Martin's specific track record on similar sole-source contracts would involve analyzing past performance reviews, contract modifications, and any associated cost overruns or efficiencies.

Are there any known risks associated with the Sniper Targeting Pod system that could impact future spending or performance?

Potential risks associated with advanced defense systems like the Sniper Targeting Pod can include technological obsolescence, integration challenges with evolving aircraft platforms, cybersecurity vulnerabilities, and sustainment costs. While the system has been operational for a considerable period (contract awarded in 2009), continuous upgrades and maintenance are necessary to keep pace with technological advancements and evolving threats. Risks could also arise from supply chain disruptions for critical components or geopolitical factors affecting international sales or partnerships. For this specific contract, the 'NOT AVAILABLE FOR COMPETITION' status might suggest that the system is highly specialized, potentially increasing reliance on a single supplier and associated risks. Future spending could be impacted by the need for upgrades, replacements, or the development of next-generation targeting systems.

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: COMM/DETECT/COHERENT RADIATION

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 (UEI: 834951691)

Address: 5600 W SAND LAKE RD MP125, ORLANDO, FL, 32819

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

Financial Breakdown

Contract Ceiling: $29,173,893

Exercised Options: $29,173,893

Current Obligation: $29,173,893

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline