DoD's $2.3B SNIPER ATP contract awarded to Lockheed Martin for advanced targeting systems

Contract Overview

Contract Amount: $23,090,000 ($23.1M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2012-04-26

End Date: 2017-04-25

Contract Duration: 1,825 days

Daily Burn Rate: $12.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SNIPER ATP

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $23.1 million to LOCKHEED MARTIN CORPORATION for work described as: SNIPER ATP Key points: 1. Contract awarded for advanced targeting pods, enhancing aircraft capabilities. 2. Significant investment in precision strike technology for the Air Force. 3. Long-term contract duration suggests sustained need for these systems. 4. Sole-source award raises questions about competition and potential cost savings. 5. Focus on a single contractor may limit innovation and market responsiveness. 6. Geographic concentration of performance in Florida noted.

Value Assessment

Rating: fair

The total award amount of $2.3 billion over a five-year period represents a substantial investment in advanced targeting technology. Without specific performance metrics or cost breakdowns per pod, a direct value-for-money assessment is challenging. Benchmarking against similar advanced targeting pod contracts is difficult due to the specialized nature of the SNIPER ATP and its sole-source award. The fixed-price nature of the contract provides some cost certainty, but the lack of competition limits the government's ability to negotiate the best possible price.

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 is typically used when a unique capability is required, or when only one source can provide the necessary goods or services. The lack of competition means the government did not benefit from a bidding process that could have driven down prices or spurred innovation from multiple vendors.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. Without alternative proposals, it's harder to ensure the price reflects the lowest achievable cost for this critical defense system.

Public Impact

Enhances the precision strike capabilities of U.S. Air Force aircraft. Provides pilots with advanced targeting information for improved situational awareness and mission success. Supports the warfighter by delivering state-of-the-art sensor and targeting technology. Contributes to the defense industrial base, particularly in Florida where performance is concentrated.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Long-term contract duration may reduce flexibility to adopt newer technologies.
Concentration of a critical defense capability with a single provider.

Positive Signals

Provides a critical, proven capability (SNIPER ATP) to the Air Force.
Fixed-price contract offers cost predictability.
Sustained investment in advanced defense technology.

Sector Analysis

The SNIPER ATP falls within the aerospace and defense sector, specifically in the manufacturing of advanced sensor and targeting systems. This market is characterized by high R&D costs, long product development cycles, and significant government procurement. The market for targeting pods is relatively concentrated, with a few key players dominating. This contract represents a significant portion of spending within this niche, reflecting the importance of precision-guided munitions and advanced electro-optical/infrared systems in modern warfare.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there information indicating significant subcontracting opportunities for small businesses. The award to a large prime contractor like Lockheed Martin suggests that the primary focus is on the prime's capabilities. Further analysis would be needed to determine the extent of small business involvement in the supply chain for this specific contract.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management structures. The Air Force is responsible for managing the contract's performance and ensuring compliance with its terms. Transparency is generally maintained through contract award databases and reporting requirements, though specific details on performance metrics and cost breakdowns may be limited for proprietary or security reasons. Inspector General investigations could be initiated if performance issues or fraud are suspected.

Related Government Programs

Advanced Targeting Pods
Air Force Weapon Systems
Precision Strike Capabilities
Aerospace Manufacturing
Defense Electronics

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns
Limited innovation incentive

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.1 million to LOCKHEED MARTIN CORPORATION. SNIPER ATP

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 $23.1 million.

What is the period of performance?

Start: 2012-04-26. End: 2017-04-25.

What is the historical spending trend for SNIPER ATP or similar targeting pod systems by the Department of Defense?

Historical spending on SNIPER ATP and comparable targeting pod systems by the Department of Defense has been substantial, reflecting the critical role these technologies play in modern air combat. While specific figures for SNIPER ATP prior to this award are not detailed here, the system has been in development and deployment for over a decade. The total award of $2.3 billion over five years indicates a consistent and significant demand. Broader spending on electro-optical/infrared (EO/IR) targeting systems across the DoD often runs into billions annually, encompassing various platforms and upgrade programs. This contract represents a major, albeit sole-source, commitment to a specific, advanced capability within that larger spending picture.

How does the unit cost of the SNIPER ATP compare to other advanced targeting pods in the market?

Directly comparing the unit cost of the SNIPER ATP is challenging without specific per-unit pricing data from this contract and detailed specifications of comparable systems. However, advanced targeting pods are complex, high-technology systems with significant research, development, and manufacturing costs. Market analysis suggests that such systems can range from hundreds of thousands to over a million dollars per unit, depending on their capabilities, sensor resolution, and integration requirements. Given the SNIPER ATP's advanced features and its sole-source award to Lockheed Martin, its unit cost is likely at the higher end of this spectrum. Without competitive bidding, it's difficult to ascertain if this represents optimal value compared to what a competitive market might yield.

What are the key performance metrics used to evaluate the success of the SNIPER ATP program?

Key performance metrics for the SNIPER ATP program typically revolve around its ability to accurately detect, identify, and track targets in various conditions, as well as its reliability and maintainability. Specific metrics often include target detection range, accuracy in weapon delivery guidance, image clarity and resolution, system uptime, mean time between failures (MTBF), and ease of integration with different aircraft platforms. The program's success is also measured by its contribution to mission effectiveness, such as increased first-shot success rates and reduced collateral damage. While this contract award doesn't detail these metrics, ongoing performance evaluations by the Air Force would assess the system against these benchmarks.

What is Lockheed Martin's track record with delivering advanced targeting systems to the DoD?

Lockheed Martin Corporation has a long and extensive track record of delivering advanced targeting systems and other sophisticated defense technologies to the Department of Defense. They are a major defense contractor with significant expertise in areas such as electro-optical/infrared (EO/IR) sensors, guidance systems, and integrated weapon platforms. The SNIPER ATP itself is a testament to their capabilities in this domain. Historically, Lockheed Martin has been a key supplier for numerous critical DoD programs, often demonstrating strong technical performance, though like many large contractors, they have also faced scrutiny regarding cost and schedule on various projects. Their established position in the defense industry suggests a high likelihood of meeting the technical requirements for the SNIPER ATP.

What are the potential risks associated with a sole-source award for a critical defense system like SNIPER ATP?

The primary risk associated with a sole-source award for a critical defense system like the SNIPER ATP is the potential for inflated costs due to a lack of competition. Without competing bids, the government has less leverage to negotiate favorable pricing. Another risk is reduced innovation, as the sole contractor may have less incentive to invest in significant improvements or cost-saving measures when there is no competitive threat. Furthermore, reliance on a single supplier can create supply chain vulnerabilities and reduce flexibility if the contractor faces production issues or decides to discontinue the product line. This can also lead to vendor lock-in, making it difficult and costly to switch to alternative solutions in the future.

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 # MP-265, ORLANDO, FL, 32819

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: $23,090,000

Exercised Options: $23,090,000

Current Obligation: $23,090,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline