DoD awards $45M to Lockheed Martin for Sniper Advanced Targeting Pods, a sole-source procurement

Contract Overview

Contract Amount: $45,018,486 ($45.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2012-12-04

End Date: 2019-12-31

Contract Duration: 2,583 days

Daily Burn Rate: $17.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: PROCUREMENT OF SNIPER ADVANCED TARGETING PODS (ATP)

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $45.0 million to LOCKHEED MARTIN CORPORATION for work described as: PROCUREMENT OF SNIPER ADVANCED TARGETING PODS (ATP) Key points: 1. The contract value of $45 million for advanced targeting pods represents a significant investment in defense capabilities. 2. Sole-source procurement raises questions about potential price inflation and lack of competitive pressure. 3. The duration of the contract (2,583 days) suggests a long-term need for these critical systems. 4. The procurement falls under the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' NAICS code, indicating a specialized technology area. 5. The firm fixed-price contract type aims to provide cost certainty for the government. 6. The absence of small business set-aside indicates this is likely a large-scale, specialized acquisition.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without comparable sole-source procurements for the Sniper ATP. However, the firm fixed-price structure provides some cost control. The long duration suggests a sustained need, and the value should be assessed against the operational benefits and technological advancements these pods offer to the Department of Defense. Without competitive bids, it's difficult to definitively state if the price represents optimal value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This typically occurs when a specific contractor possesses unique capabilities or intellectual property essential for the requirement, or in situations where competition is deemed impractical or not in the best interest of the government. The lack of competition means there was no direct price comparison from multiple vendors, potentially leading to a higher price than if it had been competed.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. Without competing the requirement, there is less assurance that the government secured the most cost-effective solution available in the market.

Public Impact

The primary beneficiaries are the U.S. Air Force and other branches of the Department of Defense, enhancing their aerial surveillance and targeting capabilities. The services delivered include the provision of advanced targeting pods, crucial for modern military operations, enabling precision strikes and intelligence gathering. The geographic impact is national, supporting defense readiness across various theaters of operation. Workforce implications are likely concentrated within Lockheed Martin's advanced manufacturing and engineering sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially increasing costs for taxpayers.
Lack of competition may reduce incentives for the contractor to innovate or reduce costs over time.
Long contract duration could lead to price increases if not managed carefully through contract modifications.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Procurement of advanced targeting pods enhances critical military capabilities.
Lockheed Martin is a well-established defense contractor with a track record in this technology area.

Sector Analysis

The Sniper Advanced Targeting Pod (ATP) market is a specialized segment within the aerospace and defense industry, focusing on sophisticated electro-optical/infrared (EO/IR) targeting systems for military aircraft. This sector is characterized by high technological barriers to entry, significant R&D investment, and a primary customer base of government defense agencies. Competitors in this space often include major defense contractors with established expertise in sensor technology and avionics. Spending in this area is driven by the need for enhanced precision strike capabilities and intelligence, surveillance, and reconnaissance (ISR) assets.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Given the specialized nature of advanced targeting pods and the sole-source award to a large prime contractor like Lockheed Martin, it is unlikely that significant subcontracting opportunities for small businesses are mandated within this specific contract. However, Lockheed Martin may engage small businesses for components or services as part of its broader supply chain, but this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contract management agencies, such as the Defense Contract Management Agency (DCMA). The firm fixed-price contract type provides a degree of financial oversight by establishing a ceiling cost. 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 to the contract.

Related Government Programs

Advanced Targeting Pods
Aerospace and Defense Procurement
Military Avionics
Department of Defense Contracts
Sole-Source Procurements

Risk Flags

Sole-source procurement
Lack of competitive bidding
Potential for price inflation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $45.0 million to LOCKHEED MARTIN CORPORATION. PROCUREMENT OF SNIPER ADVANCED TARGETING PODS (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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $45.0 million.

What is the period of performance?

Start: 2012-12-04. End: 2019-12-31.

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

Analyzing historical spending on Sniper Advanced Targeting Pods (ATP) requires access to detailed contract databases beyond the single award provided. However, the provided data indicates a significant sole-source award of $45,018,485.74 to Lockheed Martin Corporation for these pods, with a contract period from December 4, 2012, to December 31, 2019. This suggests a sustained investment in this technology over several years. To understand the broader trend, one would need to aggregate all contracts awarded for Sniper ATPs, including any previous sole-source awards, competitive procurements (if any), sustainment contracts, and upgrade programs. This would reveal the total lifecycle cost and the evolution of spending patterns as the technology matured and operational requirements changed. Without this broader dataset, it's difficult to establish a definitive trend beyond this specific contract's value and duration.

How does the unit cost of the Sniper ATP compare to similar targeting pods from other manufacturers?

Directly comparing the unit cost of the Sniper ATP is challenging without knowing the exact quantity of pods procured under this $45 million contract and the specific configuration. Furthermore, this was a sole-source award, meaning there was no competitive bidding to establish a market-driven price. However, advanced targeting pods are complex systems with unit costs often ranging from several hundred thousand to over a million dollars, depending on features and integration. Competitors like Raytheon produce similar systems (e.g., Paveway, LITENING). A comprehensive benchmark would require analyzing publicly available data on unit costs for comparable pods procured competitively by the DoD or allied nations, factoring in differences in technology, capabilities, and contract terms. The lack of competition here makes a precise value-for-money assessment difficult.

What are the key performance metrics or operational benefits associated with the Sniper ATP?

The Sniper Advanced Targeting Pod (ATP) is designed to provide military aircraft with high-resolution imagery and precise targeting capabilities, significantly enhancing situational awareness and the effectiveness of precision-guided munitions. Key performance benefits include its ability to detect, identify, and track targets at extended ranges, even in adverse weather conditions, thanks to its advanced sensor suite (including infrared and laser designation). It supports network-centric warfare by relaying real-time intelligence, surveillance, and reconnaissance (ISR) data. Operationally, this translates to improved first-target-hit probability, reduced collateral damage, and enhanced survivability for aircrews by enabling them to engage threats from safer distances. The DoD procures these pods to maintain a technological edge in air-to-ground warfare.

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

Lockheed Martin Corporation is a major defense contractor with extensive experience in sole-source procurements, particularly for highly specialized and technologically advanced systems where they hold unique capabilities or intellectual property. The provided data shows a $45 million sole-source contract for Sniper ATPs, awarded in 2012 with a long performance period. This is relatively modest in the context of Lockheed Martin's overall portfolio, which includes multi-billion dollar sole-source programs like the F-35 Joint Strike Fighter. Their track record with such contracts is generally characterized by a history of delivering complex systems, though like any large contractor, they have faced scrutiny regarding pricing and program execution on various sole-source awards. The DoD's reliance on Lockheed Martin for specific platforms often necessitates sole-source arrangements due to the integrated nature of the technology and extensive prior investment.

Are there any known risks or concerns associated with the Sniper ATP system itself or its procurement?

The primary risk associated with this specific procurement is its sole-source nature. This limits competitive pressure, potentially leading to higher costs for taxpayers and reduced incentive for the contractor to optimize pricing or accelerate innovation. Beyond the procurement method, risks associated with advanced targeting pods can include technological obsolescence, integration challenges with evolving aircraft platforms, and sustainment costs over the system's lifecycle. While the Sniper ATP is a mature and widely deployed system, continuous upgrades are necessary to maintain its effectiveness against emerging threats. Specific performance issues or reliability concerns would typically be documented in program office reports or Government Accountability Office (GAO) reviews, which are not detailed in the provided data. However, the long duration of the contract (over 7 years) implies a sustained operational need, suggesting the system is performing adequately to meet requirements.

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

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: $45,018,486

Exercised Options: $45,018,486

Current Obligation: $45,018,486

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline