DoD Awards $34.6M for U-2 Programmed Depot Maintenance and Sustainment to Lockheed Martin

Contract Overview

Contract Amount: $34,558,689 ($34.6M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2019-09-23

End Date: 2026-02-19

Contract Duration: 2,341 days

Daily Burn Rate: $14.8K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: U-2 PROGRAMMED DEPOT MAINTENANCE AND SUSTAINMENT

Place of Performance

Location: PALMDALE, LOS ANGELES County, CALIFORNIA, 93599

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $34.6 million to LOCKHEED MARTIN CORPORATION for work described as: U-2 PROGRAMMED DEPOT MAINTENANCE AND SUSTAINMENT Key points: 1. Significant contract value for specialized aircraft sustainment. 2. Sole-source award to incumbent prime contractor raises competition concerns. 3. Long-term sustainment contract indicates ongoing operational reliance on the U-2. 4. Focus on depot maintenance suggests potential for cost efficiencies through specialized expertise.

Value Assessment

Rating: fair

The contract value of $34.6 million over several years for programmed depot maintenance and sustainment appears reasonable given the specialized nature of the U-2 aircraft. However, without specific per-unit cost data or detailed breakdowns of maintenance tasks, a precise value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded sole-source to Lockheed Martin Corporation, the original equipment manufacturer. This lack of competition limits price discovery and may result in higher costs than a competitively bid contract. The justification for sole-source is likely based on proprietary data and specialized knowledge required for U-2 sustainment.

Taxpayer Impact: The sole-source nature of this award means taxpayers may not be receiving the best possible price due to the absence of competitive pressure.

Public Impact

Ensures continued operational readiness of the U-2 reconnaissance aircraft. Supports specialized jobs in aircraft maintenance and engineering. Maintains critical intelligence, surveillance, and reconnaissance (ISR) capabilities for the Air Force.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition.
Potential for cost overruns in cost-plus contract type.
Long contract duration may not reflect evolving needs.

Positive Signals

Ensures sustainment of a critical ISR platform.
Leverages incumbent contractor's specialized knowledge.
Provides long-term planning for depot maintenance.

Sector Analysis

The aerospace and defense sector relies heavily on long-term sustainment contracts for aging platforms. Spending benchmarks for depot maintenance vary widely based on aircraft type, complexity, and service life. This contract falls within the typical range for specialized aircraft sustainment programs.

Small Business Impact

This contract was awarded directly to Lockheed Martin Corporation and does not indicate any subcontracting opportunities for small businesses in the provided data. Further analysis would be needed to determine if small businesses are involved in the supply chain or lower-tier support.

Oversight & Accountability

The Department of the Air Force is responsible for overseeing this contract. Given the sole-source nature and cost-plus contract type, robust oversight is crucial to ensure cost control and performance. Regular reviews and audits would be necessary to maintain accountability.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Lack of competition may lead to inflated costs.
Cost-plus contract type offers less incentive for contractor cost control.
Long-term sustainment of an aging platform may not be the most cost-effective strategy.
Dependency on a single contractor for critical sustainment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.6 million to LOCKHEED MARTIN CORPORATION. U-2 PROGRAMMED DEPOT MAINTENANCE AND SUSTAINMENT

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 $34.6 million.

What is the period of performance?

Start: 2019-09-23. End: 2026-02-19.

What is the projected cost per maintenance event or per flight hour for the U-2 under this contract, and how does it compare to industry benchmarks for similar aircraft?

The provided data does not include specific cost per maintenance event or per flight hour. Benchmarking is difficult without this granular information. However, for complex, aging aircraft like the U-2, sustainment costs can be significantly higher than for newer platforms. A detailed cost-benefit analysis comparing this to potential alternatives or upgrades would be valuable.

What specific technical challenges or proprietary knowledge justify the sole-source award to Lockheed Martin, and have alternative solutions been thoroughly explored?

The justification for a sole-source award typically stems from unique technical requirements, proprietary data, or specialized tooling and expertise held exclusively by the original equipment manufacturer. For the U-2, Lockheed Martin's deep historical knowledge and access to sensitive design information likely necessitate their involvement. However, a thorough review should confirm that no other entity could realistically provide the required sustainment services without prohibitive cost or time delays.

What are the key performance indicators (KPIs) for this contract, and how will the Air Force measure the effectiveness of the programmed depot maintenance and sustainment services provided by Lockheed

Key performance indicators likely include aircraft availability rates, turnaround times for maintenance, quality of repairs, and adherence to schedule. The effectiveness will be measured by the U-2 fleet's ability to meet operational readiness requirements and mission demands. Regular performance reviews and milestone tracking against the contract's statement of work are essential for ensuring the contractor meets its obligations.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: FA852819R0015

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 1011 LOCKHEED WAY, PALMDALE, CA, 93599

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: $43,169,261

Exercised Options: $43,169,261

Current Obligation: $34,558,689

Actual Outlays: $3,029,685

Subaward Activity

Number of Subawards: 22

Total Subaward Amount: $2,609,315

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA852819D0015

IDV Type: IDC

Timeline